All about Accounts & Records under GST

Accounts and other Records

Under GST all indirect taxes (excise, VAT, service tax) will get subsumed into one GST, thus reducing the number of accounts required to be maintained.

In our article we have listed the various accounts to be maintained and other records that businesses need to keep under GST.

For example, under GST, a trader has to maintain the following a/cs (apart from accounts like purchase, sales, stock) –

  • Input CGST a/c
  • Output CGST a/c
  • Input SGST a/c
  • Output SGST a/c
  • Input IGST a/c
  • Output IGST a/c
  • Electronic Cash Ledger (to be maintained on Government GST portal to pay GST)

For the entire list of accounts to be maintained please read here.

Accounting under GST

While there will be initial transition challenges, GST will bring in much clarity in many areas of business. One of the areas is accounting and bookkeeping.

While the number of accounts is more apparently under GST, once you go through the accounting you will find it is much easier for record keeping. One of the biggest advantages a trader will have is that he can setoff his input tax on service with his output tax on sale.

Please click here to read our discussions on the accounting treatment of various transactions under GST answering queries on how to record and pass entries for inter-state sale of goods, how to record utilisation of input tax credit etc.

 Electronic Cash & Credit  Ledger

Under this section we will discuss the mechanism of GST e-ledger and how does it work. E-ledger or electronic ledger is statement of cash and input tax credit in respect of a registered taxpayer. Once a taxpayer makes GST tax payment by cash, cheque, internet banking, RTGS or NEFT the amount is credited in their respective electronic ledgers namely:

  • Electronic Cash Ledger
  • Electronic Credit Ledger

These two e-ledgers are generated once after registering with common portal of GST called GSTN by a taxpayer.

Period for Retention

This sections talks about the period for which the said books of accounts and other records have to be maintained, i.e. how long the records need to be saved by the business entity.

As per the GST law every registered taxable person required to keep and maintain books of account or other records will maintain the books for at least 60 months, counted from the last date of filing of Annual Return.e Sept of following year.

Consequences of not maintaining proper records

This section talks about the consequences on defaults in case of non-maintenance of proper records, improper treatment in books of accounts and other related provisions.

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All Articles

  1. Every registered taxable person shall keep and maintain, at his principal place of business following set of specified accounts and other records under Goods and Services Tax
  2. There will be certain initial transition challenges with GST impact all areas of business. Are you thinking how will you pass accounting entries under GST?