There are scenarios where the Service Provider charges the Service Tax on the services provided but it is not possible for the Service Receiver to ascertain the service amount on which the Service Tax is charged.
In this case Service Receiver will account only the Service Tax paid amount as Input Credit to adjust towards the Service Tax Payable.
Examples: Bank charges Service Tax during Currency Conversion (Exchange). Service Provider renders service free of cost by collecting only the Service Tax amount.
Facility to avail Input Credit on the services received without specifying the Service Amount is provided in Tally.ERP 9 Release 3.3. To account Input Credit a new flag - Avail Input Credit is provided in Journal Voucher.
Example: On 15-10-2012, ABC Company received a Bank Statement with information about service tax charged on Conversion of Currency.
The Service Tax charged on the services rendered is
* Service Tax - Rs. 2400
* Education Cess - Rs. 48
* Secondary Education Cess - Rs. 24
Step 1: Alter the Bank Ledger
If the banks are providing/receiving Taxable Service, to mark Bank Ledgers as service providers a new option - Is Service Provider/Receiver is provided to enter the details of Service tax Registration Number and Date of Registration.
Alter the Bank Ledger to enable the options - Is Service Provider/Receiver and Set/Alter Service Tax Details
Enter the Service Tax Details as shown:
Step 2: Record the Transaction in Journal Voucher
To record the transaction,
Go to Gateway of Tally > Accounting Vouchers > F7: Journal
In Change Voucher Type screen, in Class field select Service Credit Adjustment from Voucher Class list
Press F2 and change the date to 15-10-2012
In Used for field select Availing Input Credit from the list of Service Tax Adjustments
In Debit field select Service Tax @ 12% Ledger
In Service Tax Details screen,
In Type of Ref field select New Ref
In Name field accept the default reference number - Jrnl/4-1 or specify the required reference number
In Category field select the appropriate service Category towards which the service tax is paid. e.g. Banking and Financial
In Amount field enter the Service Tax amount paid which you are claiming as input Credit. e.g. 2500
The Service Tax amount entered in Service Tax Details screen will be displayed automatically in Amount field
In Debit field select Education Cess @ 2% Ledger. In Service Tax Details screen enter the details as shown:
In Debit field select Secondary Education Cess @ 1% Ledger to account the Secondary Education Cess amount
In Credit field select the Bank Ledger e.g. Canara Bank to whom the Service Tax is paid
In Amount field the Total of Service Amount paid will be displayed automatically
In Bank Allocation screen enter the transaction details
The completed Availing Input Credit Journal Voucher is displayed as shown:
Press Enter to save and Accept.