GST ACCOUNTING • STEP-BY-STEP

GST Journal Entries

Complete guide with practical examples for Profit Case scenarios.

ADVERTISEMENT

The Example

On 1st May 2024, ABC Pvt. Ltd. sold goods to XYZ Pvt. Ltd. with the following details:

Invoice Value (Before GST) ₹ 1,00,000
CGST @ 9% ₹ 9,000
SGST @ 9% ₹ 9,000
Total Invoice Value ₹ 1,18,000

Assume all sales are taxable and payment received immediately.

Profit Case Analysis

Output GST (On Sales)
CGST ₹ 9,000
SGST ₹ 9,000
Total Output GST ₹ 18,000
Input GST (On Purchases)
CGST ITC ₹ 6,000
SGST ITC ₹ 6,000
Total Input GST ITC ₹ 12,000
NET GST PAYABLE
₹ 6,000

Output GST (18,000) - Input GST (12,000)

Detailed Journal Entries

Sr. No. Particulars Debit (₹) Credit (₹) Explanation
1 When Goods Sold (Invoice Raised)
Debtors A/c Dr. 1,18,000 To record sales along with output CGST & SGST
To Sales A/c 1,00,000
To Output CGST A/c
To Output SGST A/c		 9,000
9,000
2 When Goods Purchased (Stock Entry)
Purchases A/c Dr.
Input CGST A/c Dr.
Input SGST A/c Dr.		 1,00,000
6,000
6,000		 To record purchases along with input CGST & SGST (ITC Available)
To Creditors A/c 1,12,000
3 When Payment Made to Supplier
Creditors A/c Dr. 1,12,000 Payment made to vendor
To Bank A/c 1,12,000
Flow of Transaction
1.
Sale of Goods: Goods sold to customer with GST invoice.
2.
Purchase of Goods: Goods purchased from supplier with GST invoice.
3.
Payment of GST: Net GST paid to Government through GST Portal.
Key Takeaways
  • Always pass entries on invoice date (not on payment date).
  • ITC should be availed only if goods/services are received and eligible.
  • Reconcile GSTR-2B, GSTR-3B and Books regularly.
Need professional help with GST Compliance?

End-to-end GST registration, monthly filing, and annual reconciliation (GSTR-9) by certified experts.

Contact Specialist