1. Accounting of GST Transactions ?

Accounting for GST involves recording input tax (GST paid on purchases) and output tax (GST
collected on sales) in appropriate accounts.
Key GST Accounts
 Input CGST/SGST/IGST Account: Records the GST paid on purchases.
 Output CGST/SGST/IGST Account: Records the GST collected on sales.
 GST Payable Account: Tracks the net GST liability (output GST - input GST).
 GST Input Tax Credit Account: Tracks the available input credit to offset against output
tax.

Steps in GST Accounting

A. On Purchases
 Record the value of goods or services purchased.
 Record GST paid on the purchase as input tax (split into CGST/SGST for intrastate or IGST
for interstate purchases).
Example:
Purchased goods worth ₹1,00,000 from an interstate supplier, GST @18%.
 IGST = ₹1,00,000 × 18% = ₹18,000
Journal Entry:
Purchases A/c Dr ₹1,00,000
Input IGST A/c Dr ₹18,000
To Supplier A/c ₹1,18,000
B. On Sales
 Record the value of goods or services sold.
 Record GST collected on the sale as output tax (split into CGST/SGST for intrastate or
IGST for interstate sales).
Example:
Sold goods worth ₹2,00,000 to a customer within the state, GST @18%.
 CGST = ₹2,00,000 × 9% = ₹18,000
 SGST = ₹2,00,000 × 9% = ₹18,000
Journal Entry:
Customer A/c Dr ₹2,36,000
To Sales A/c ₹2,00,000
To Output CGST A/c ₹18,000
To Output SGST A/c ₹18,000
C. At the Time of GST Payment
  Offset input tax against output tax to calculate net GST liability.
 Pay the net GST liability to the government.
Example:
 Output CGST = ₹18,000
 Output SGST = ₹18,000
 Input IGST = ₹18,000
 Net CGST = ₹18,000
 Net SGST = ₹18,000
Journal Entry:
Output CGST A/c Dr ₹18,000
Output SGST A/c Dr ₹18,000
To Input IGST A/c ₹18,000
To GST Payable A/c ₹18,000
D. Payment to the Government
After determining the GST payable:
Journal Entry:
GST Payable A/c Dr ₹18,000
To Bank A/c ₹18,000 .

2. SEZ Sales under GST? And types of SEZ sales?

SEZ Sales refer to transactions involving the supply of goods or services to or by a Special
Economic Zone (SEZ) unit or developer. SEZs are designated areas that enjoy tax benefits to
promote exports. Under GST, SEZ sales are treated differently to support this goal.

Types of SEZ Sales:

Supply to SEZ (Zero-rated Supply):
Supplies made to SEZ units or developers are treated as zero-rated supplies under GST. This
means the supplier does not have to charge GST on these supplies but can claim refunds for input
taxes paid.
 Example:
A manufacturer in Delhi supplies goods worth ₹1,00,000 to an SEZ unit in Chennai. GST is
not charged on the invoice, but the manufacturer can claim a refund of input GST used in
manufacturing those goods.

Supply by SEZ (Exempt Supply):

Supplies made from SEZ units to domestic tariff areas (DTA) are generally taxable, and the
buyer is required to pay applicable GST under a reverse charge mechanism (RCM) or as per
GST norms.
 Example:
An SEZ unit in Bengaluru sells goods worth ₹50,000 to a regular business in Hyderabad.
The Hyderabad business must pay GST on this purchase under RCM, and the SEZ unit
does not collect GST.

3.Applicability of GST on Advance Receipts and Payments? Procedure for Accounting

Advance Receipts and Sales Invoice in the Same Month?
Under GST, tax liability arises at the time of supply. For advances received or paid, GST
becomes applicable as soon as the advance is received (for the supplier) or paid (for the
recipient), even if the actual goods or services are delivered later.
Advance Receipt for Supply of Goods or Services:
 GST must be calculated and paid on the advance amount received by the supplier.
 The tax is adjusted against the final invoice when the supply is completed.
Example:
A service provider receives an advance of ₹50,000 on January 1 for a service to be rendered in
February. GST at 18% is charged on the advance:
 Advance Amount: ₹50,000
 GST: ₹50,000 × 18% = ₹9,000
 Total: ₹59,000
The service provider pays ₹9,000 GST in January and adjusts it when issuing the final invoice.
Advance Payment for Purchase of Goods or Services:
 The recipient can claim input tax credit (ITC) on GST paid on the advance if the supply is
linked to taxable goods or services.
Example:
A business pays ₹30,000 as an advance for purchasing goods worth ₹1,00,000. The supplier
charges GST at 12% on the advance:
 Advance Amount: ₹30,000
 GST: ₹30,000 × 12% = ₹3,600
 Total Advance Paid: ₹33,600
The business can claim an ITC of ₹3,600 after receiving the tax invoice for the advance.
 For goods, advance GST has been removed since 2018, but it remains applicable for
services.
Procedure for Accounting Advance Receipts and Sales Invoice in the Same Month
Advance Receipt from Customer:
o Record the advance amount received along with GST.
 o Example: Advance received ₹50,000, GST @18% = ₹9,000.
o Bank A/c Dr ₹59,000
o To Advance from Customer A/c ₹50,000
o To Output GST A/c ₹9,000
Generate Final Sales Invoice:
o Record the total sales value, including GST.
o Example: Total invoice ₹1,00,000, GST @18% = ₹18,000.
o Debtor A/c Dr ₹1,18,000
o To Sales A/c ₹1,00,000
o To Output GST A/c ₹18,000
Adjust Advance against Final Invoice:
o Offset the advance already received.
o Advance from Customer A/c Dr ₹59,000
o To Debtor A/c ₹59,000
Remaining Balance Receipt:
o Record the remaining amount received from the customer.
o Example: Remaining balance ₹59,000.
o Bank A/c Dr ₹59,000
o To Debtor A/c ₹59,000.

4. Mixed and Composite Supply under GST?

Composite Supply:
A supply of two or more goods or services that are naturally bundled and provided together. One
item is the principal supply, and GST is charged based on its tax rate.
 Example:
A business sells a laptop with a charger. The laptop is the principal supply, and GST is
charged at the rate applicable to laptops.
Mixed Supply:
A supply of two or more goods or services that are not naturally bundled and can be sold
separately. GST is charged based on the item with the highest tax rate.
 Example:
A gift hamper containing chocolates (5% GST) and a bottle of perfume (18% GST). Since
this is a mixed supply, GST is charged at 18%, the highest rate among the items.
5. Time limit and modes of payment of gst?
Time Limit for Payment of GST:
 GST payment is due by the 20th of the following month for regular taxpayers.
  For taxpayers under the Composition Scheme, GST must be paid quarterly by the 18th
of the month following the quarter.
 Payment must be made before filing the respective GST return.
Modes of Payment of GST:
Online Payment (Through GST Portal):
o Net Banking
o Debit/Credit Card
o UPI
Offline Payment:
o Generate a challan on the GST portal and pay at an authorized bank via:
 Cash
 Cheque
 Demand Draft
Utilization of Input Tax Credit (ITC):
o ITC can be used to offset GST liabilities, except for specific cases like interest and
penalty.
NEFT/RTGS:
o Payments can also be made through NEFT/RTGS using the unique transaction
reference number (UTR).

6.Composite Dealer under GST? Features? Recording of purchases?

A Composite Dealer is a taxpayer registered under the Composition Scheme, which allows
small businesses to pay GST at a fixed rate on turnover without claiming Input Tax Credit (ITC).
Features of a Composite Dealer:
Lower Tax Rates: Fixed rates based on business type (e.g., 1% for traders, 5% for
restaurants).
Turnover Limit: Restricted to businesses with turnover up to ₹1.5 crore (₹75 lakh in some
states).
No ITC Claim: Cannot claim ITC on purchases.
Limited Transactions: Cannot engage in interstate supply (only intrastate).
Tax Included in Price: Cannot collect GST separately on invoices.
Recording Purchases Made from a Composition Dealer:
When buying from a composition dealer, no GST is charged in the invoice, as composition dealers
are not allowed to collect GST from buyers. The buyer records the purchase as a regular expense.
Example:
A business purchases goods worth ₹50,000 from a composition dealer.
Journal Entry:
Purchases A/c Dr ₹50,000
To Bank/Cash A/c ₹50,000
 No Input GST is recorded since the composition dealer's invoice does not include GST.
7.Unregistered Dealer under GST? Features? Recording of purchases?
An Unregistered Dealer is a person or entity not registered under GST, either because their
turnover is below the threshold limit or they deal in exempt goods/services.
Features of an Unregistered Dealer:
No GST Collection: Cannot charge or collect GST on sales.
No Input Tax Credit (ITC): Buyers cannot claim ITC on purchases made from unregistered
dealers.
Reverse Charge Mechanism (RCM): In specific cases, the buyer (registered dealer) must
pay GST under RCM.
No GST Compliance: Not required to file GST returns or comply with GST provisions.
Recording Purchases Made from an Unregistered Dealer:
If the buyer is required to pay GST under RCM, they record the GST liability while accounting for
the purchase. If no RCM applies, it is recorded as a regular purchase.
Example 1 (RCM Applicable):
A registered dealer purchases goods worth ₹10,000 from an unregistered dealer, and GST @18%
is payable under RCM.
Journal Entry:
Purchases A/c Dr ₹10,000
Input GST (RCM) A/c Dr ₹1,800
To Bank/Cash A/c ₹10,000
To GST Payable (RCM) A/c ₹1,800
Example 2 (No RCM):
A registered dealer purchases goods worth ₹10,000 from an unregistered dealer where RCM does
not apply.
Journal Entry:
Purchases A/c Dr ₹10,000
To Bank/Cash A/c ₹10,000
8.Exports under GST? Imports ?
Exports refer to the supply of goods or services from India to a location outside India. Exports are
classified as Zero-rated supplies, meaning GST is not charged, and exporters can claim refunds
of ITC or taxes paid.
Types of Exports under GST:
 Export with Payment of GST:
o Exporter pays GST on the goods/services and later claims a refund of the tax paid.
o Example: An exporter sells goods worth ₹1,00,000 and charges 18% GST. After
exporting, the ₹18,000 paid is refunded.
Export without Payment of GST (Under LUT/Bond):
o No GST is charged on exports if a Letter of Undertaking (LUT) or Bond is submitted.
ITC on inputs used for exports can still be claimed as a refund.
Imports under GST:
Imports involve bringing goods or services into India from outside the country. Imports are treated
as Interstate Supplies, and Integrated GST (IGST) is charged along with customs duties.
 Example: Goods imported worth ₹1,00,000 attract IGST @18%. The importer pays
₹18,000 as IGST and can claim it as ITC if used for taxable supplies.

9.Exempted Goods under GST?

Exempted goods are those on which no GST is levied. Below is a general list of commonly
exempted goods:
Agricultural Products:
 Fresh fruits and vegetables
 Unprocessed cereals and pulses
 Fresh meat, fish, eggs, and milk
Basic Essentials:
 Salt
 Bread (not branded)
 Flour, atta, maida, besan (unbranded)
 Drinking water (not packaged)
Healthcare and Medicinal Products:
 Human blood and its derivatives
 Vaccines (exempt or at a lower rate)
Educational and Cultural Items:
 Printed books
 Educational materials specified under GST
 Items like slates, chalk, and blackboards
Handicrafts and Traditional Goods:
 Khadi products (sold by certain organizations)
 Handloom fabrics
Other Miscellaneous Items:
 Newspapers
 Organic manure
 Prasadam from religious places
10.Records and Accounts to be Maintained by a Registered Person under GST?
A registered person under GST must maintain the following records for accurate tax compliance:
Sales Records (Outward Supplies):
o Details of goods or services sold, including invoices, debit notes, and credit notes.
Purchase Records (Inward Supplies):
o Details of goods or services purchased, including purchase invoices and bills of
supply.
Stock Register:
o Quantity and value of stock available, received, and supplied.
Input Tax Credit (ITC) Records:
o Track ITC claimed on purchases and adjustments made.
Output Tax Liability:
o Record GST collected on sales and payable to the government.
Payment of GST:
o Details of GST paid, including challans and payment receipts.
E-Way Bills (if applicable):
o Records of e-way bills generated for transporting goods.
Job Work Records (if applicable):
o Details of goods sent or received for job work, including returns.
Other Financial Records:
o Records of advances received, refunds claimed, and expenditures incurred.
Miscellaneous Documents:
 Delivery challans, shipping bills, and other supporting documents for exports/imports.
Retention Period: Records must be maintained for 6 years from the due date of filing the annual
return for the year.
11.Procedure for Filing GST Returns Online?
Filing GST returns online involves submitting details about sales, purchases, taxes collected, and
taxes paid.
Login to GST Portal:
o Visit the official GST portal (www.gst.gov.in).
o Log in using your GSTIN and password.
 Select the Appropriate Return Form:
o GSTR-1: For details of outward supplies (sales).
o GSTR-3B: For summary of outward and inward supplies, and to pay taxes.
o GSTR-9: Annual return (for those registered under GST).
o Choose the form based on the type of return you're filing.
Fill in the Return Details:
o For GSTR-1 (Outward Supplies):
 Enter details of all sales, including taxable sales, exempt sales, exports, and
more.
o For GSTR-3B (Summary Return):
 Enter total sales, purchase details, and taxes (CGST, SGST, IGST, and cess)
in the respective fields.
Reconcile and Review:
o Ensure all data entered is correct by comparing with sales/purchase records.
o Check for any discrepancies or missing information.
Pay GST (if applicable):
o Calculate the total tax liability.
o Pay the GST due using the available payment modes (bank transfer, debit/credit
card, etc.).
File the Return:
o Once all the details are correct and taxes paid, click on the "Submit" or "File"
button.
o You will receive an acknowledgment number and the status will show as “Filed”.
Download the Filed Return:
o After successful submission, download a copy of the filed return for your records.
Important Points to Remember:
 GSTR-1 should be filed by the 10th of the following month.
 GSTR-3B should be filed by the 20th of the following month.
 Late fees and penalties may apply for delays in filing.