How to handle GST Reverse Charge on Sales Item? Revenue is car hire service and customer has to pay GST under RCM so how to create invoice with GST payable under RCM?

My query is not for bill but it is for invoice. My customer has to pay GST on reverse charge. My concern is how to configure RCM on invoice.

Hi Mohammed Aizan, here's a sample tax adjustment entry using accounts involved in sales transactions and purchase transactions (w/ and w/o RCM).

Let's say -

1. You've collected INR50 each in CGST and SGST on sales.
2. You've paid INR30 each in CGST and SGST on a non-RCM purchase, and
3. You're to pay INR20 each in CGST and SGST on account of an RCM purchase.

The tax adjustment journal entry will be as follows.

Output CGST Dr 50

Input CGST Cr 30

Output CGST Tax RCM Dr 20

CGST Payable Cr 40

Output SGST Dr 50

Input SGST Cr 30

Output SGST Tax RCM Dr 20

SGST Payable Cr 40

Once done, you will be able to claim the RCM input credit in the next filing period. The account carrying this credit is named Input CGST/SGST Tax RCM and this account must be debited just like the Input CGST/SGST accounts are in the entry above.