In this blog, we will be explaining how we adjust GST liability procedure, also we will be showcasing the repercussion effect of it.
In Reverse charge service invoices, GST liability arises the date immediately following 60th day from date of issue of supplier invoice if payment is not made against it. System shall create GST Liability and Credit.
Setup- 1: Assign No series in Purchase & Payable Setup
Setup- 2: Create Source Code for GST Liability
Setup- 3: Map Source Code to Source Code Setups
GST Liability Adjustment Journal
Liability Generate / Reversal formulas
|Posting Date||Liability Adjustment Posting Date|
|Liability Date Formula||Enter 60D, System will calculate -60days from Posting date of Arriving Liability Filter Date|
|Liability Filter Date||Based on liability date formula, system will consider all open Posted RC service invoices before -60Days
Example: 01/Jan/19 – 60D = 02-Nov-18
|Nature of Adjustment||Generate Liability
Reverse Liability: Only Reversed Liability that Generated by GST Liability Adjustment journal
Select Entries and finally Post Generate / Reversal
Posted GST Liability Adj. Entries
The impact of this will be reflected in GSTR-3B.
Hence, on a concluding note, liability will be counted on the Invoice generated and not on the payment.