We know that purchase entry is
Purchase Dr
To Party
Explanation-Purchase is an Expense ,all expenses are Debited
Party is Sundry Creditor, a Liability, when liability increase it is Credited
Same Entry with GST is
Purchase Dr
Input GST Dr
To Party
Explanation-We get ITC benefit of this GST, so it is like an asset for us
When asset increases,it is Debited)
Lets learn about it with the help of an example


Entry for Purchase.jpg


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Purchase from A Rs 100000 Purchase Dr To A 100000 100000 100000 5000 Purchase Interstate 5% Dr Input IGST 5% Dr To A 105000 Purchase Interstate Rs 100000 + 5% GST 100000 2500 Purchase Local 5% Dr Input CGST 2.5% Dr To A 105000 Entry for Purchase Purchase Local Rs 100000 + 5% GST

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 10 years. He also provides Accounts Tax GST Training in Delhi and Pune.