Consider the following situation:
● The service provider charges service tax on the services provided, and
● It is not possible for the service receiver to ascertain the amount on which service tax is charged.
In such a case, service receiver will account only the service tax paid amount as Input Credit, to adjust towards the service tax payable.
On 16-11-2015, D-Day Events received advertising services worth ₹ 2,00,000 from AtoZ Company on which service tax is charged at @ 12.36%. The service tax paid was ₹ 24,720.
To record a journal voucher for availing input credit
1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
3. Select Service Tax in the field Type of duty/tax.
4. Select Availing Input Credit in the field Nature of Adjustment.
The Stat Adjustment screen appears as shown below:
5. Debit service tax ledger.
6. Enter 24720 in the field Amount.
7. Enter the service tax breakup details in the Tax Payment Details screen.
8. Credit AtoZ Company. The amount will be automatically filled.
9. Select the Bill-wise Details.
10. Enter Narration, if required.
11. Press Enter to save.
The journal voucher appears as shown below:
12. Press Enter to save.
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