Unlock the Secrets of Accounting Principles: A Technical Guide from GST Prospective
Our Discussion will be based on following Points :
- Revenue Recognition : This term Include all type of Income which is received by that Individual/firm. GST will be charged on all type of income excluding financial Interest and financial credit Note. If individual has taken the GSTN then GST will be charged on his personal income as well. On the sales part IGST/CGST/SGST Should be charged based on type of supply i.e. intra state or Interstate.
Special : Revenue Recognition in case of government construction work : In this situation the amount received from government should be treated as inclusive of GST so we need to maintain accounting accordingly.
- Expenses Recognition : Expenses Recognition should be completely based on invoicing. Special care should be taken care while booking the expenditure on which reverse charge related liability is applicable.
- Role of Closing Stock : Closing Stock plays a very important role in Accounting from GST Perspective. We need to maintain our stock according to our sales and purchase during the year.
- Input tax Credit and Reconciliation with GSTR – 2B : Reconciliation of GSTR – 2B with Books is very crucial task. we need be very much careful while maintaining the books of accounts. We also need to maintain one extra ledger i.e. Unclaimed GST to know the status of reconciliation of Input Tax Credit.
- Reconciliation of ITC Closing Balance with GSTN Portal Closing Balance : While maintaining the Books of Accounts, we need to ensure that the ITC Closing balance Books is reconciled with GSTN Portal so that we can ensure the compliances.
- Recognition of Fixed Assets : While booking the purchase of Fixed Assets, we just need to confirm that Depreciation should not be claimed on ITC Part. In case of sales of Fixed Assets, we just need to ensure that GST has been charged on sales of Fixed Assets.
- Applicability of GST on Bank Charges : On receipt of bank invoices, we need to book that GST Figure as well. But in certain situation we are not receiving the Invoices from Banks, in that case we can book the expenses and input tax credit through GSTR – 2B.
- Special Care for Creditors : While maintaining the books of accounts we need to be very much careful about the creditors. No creditor should be outstanding more then 180 days. If there is any creditor outstanding for then 180 days in that case we need to reverse the partial input tax credit on the basis of outstanding Balance.
- Items on which GST is Not Applicable :
- Salary and Wages
- Water
- Electricity
- 5 Petroleum Products
- Special Accounting Principal will be applicable in certain specific Industries :
- Petroleum Pump
- Construction
- Services sector Industry
- Manufacturing Industry
- Advances Received in case of Service Sector Industries : In case of Service sector Industry GST will be charged on Advances hence we need to ensure the Accounting Accordingly.
