In service tax what is the menaning of crediit adjustment and how is worked in tally?

Question

In service tax what is the menaning of crediit adjustment and how is worked in tally?

Answer 1

Credit adjustments is service tax paid on inputs.

For information on Service Tax in India, read http://mytaxes.in/index.php?topic=14.0

Answer 2

The Service Tax paid by you on input services to your business can be adjusted to the Service Tax payable by you.  This is called 'adjustment of Service Tax Credit'.

In Tally.. You can enter your Creditors Bill in such a manner, that the cost of Service to be accounted in Labour Charges Paid/Professional Charges paid etc., Service Tax & CESS into respective ledgers...

Similarly your Service Bills should be raised accordingly splitting the Service Charges and Taxes seperately.

Now the Ledger 'Service Tax' will have both Credits and Debits (Credits - Service Tax paid to your Creditors; Debits - Service Tax in your Invoices raised to your Debtors).  The closing balance is the amount payable (or) amount in credit.

Another alternative method is to create separate ledgers for Service Tax Paid & Service Tax Payable.  At the end of the month you have to raise a journal for adjustment..