How to: Apply Service Tax Entries

Article
10/18/2021

When you make or receive an offline payment for an invoice with service tax, you must apply the invoice with the payment. This ensures that the general ledger entries that are related to service tax and the detailed entries that are related to service tax are created automatically for the payments that are made offline. You can claim the service tax paid for the invoice as input tax credit after you make the payment for the invoice and apply the payment to the corresponding invoice.

You can also apply service tax entries for an invoice with advance payment. For more information, see How to: Calculate and Apply Service Tax on Advance Payments.

When you post an order with Service Tax, the service tax entry for that purchase order or sales order is created automatically. For more information, see Posting Purchase Orders and Posting Sales Orders.

The following procedure describes how to apply service tax entries for purchase transactions, but the same steps also apply to sales transactions.

To apply service tax entries

In the Search box, enter Vendors, and then choose the related link.
Select the required vendor, on the Home tab, in the Manage group, choose Edit.
On the Navigate, in the History group, choose Ledger Entries.
Select the service tax invoice for which you want to apply payment, and on the Actions tab, in the Functions group, choose Apply Entries.
In the Apply Vendor Entries window, select the payment that you want to apply for the invoice, and on the Navigate tab, in the Application group, choose Set Applies-to ID to populate the user identification of the person who applied the payment.
On the Navigate tab, in the Application group, choose Post Application.
In the Post Application window, choose OK to confirm the application of the selected payment to the invoice. The general ledger entry and the service tax detailed entry are created automatically.

Note

In the Post Application window, the Document No. and Posting Date fields are populated automatically with the information from the Apply Vendor Entries window. For more information, see Apply Vendor Entries Window.
Choose OK.

After applying the service tax entries, you can view the details.

To view the applied service tax entries

In the Search box, enter Vendors, and then choose the related link.
Select the required vendor, and on the Home tab, in the Manage group, choose Edit.
On the Navigate tab, in the Vendor group, choose Ledger Entries.
Select the applied service tax invoice entry, and on the Actions tab, in the General group, choose Navigate.
On the Document Entry FastTab, select G/L Entry, and on the Actions tab, choose Show.

You can view the general ledger entry that was created for the payment amount and then applied to the invoice. For more information, see G/L Entry Table.
Choose Close.
In the Navigate window, on the Document Entry FastTab, select Service Tax Entry, and on the Actions tab, choose Show.

You can view details about the service tax for each entry. For more information, see Service Tax Entries Window and Service Tax Entry Table.

Note

When you apply an invoice with advance payment, the service tax entry created at the time of the advance payment is set to zero. A service tax detailed entry for advance payment is created. This entry corresponds with the service tax entries created during the advance payment.
Choose Close.
In the Service Tax Entries window, choose Details to view the service tax entry details and the relevant challan details such as challan number and challan date. For more information, see Service Tax Entry Details Window and Service Tax Entry Details Table.
Choose Close.

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How to: Apply Service Tax Entries

To apply service tax entries

To view the applied service tax entries

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