Dear Sir, If a Hotel collects Rs 20000 as Advance from a customer in Dec’19 for a party to be held after 4 months. Then Hotel deposited GST @ 5% i..e. Rs 5000 on Advance basis in Dec’19 month GSTR-3B. Query-
- Receipt voucher will be issued to Customer in Dec’19 for Rs 20000 mentioning it as Inclusive of GST ?
- If in Jan’2020, Party is cancelled by customer & Hotel forfeits Rs 20000 , then what to do with the GST paid to Govt on Rs 20000 ?? Can Hotel CLAIM ADJUSTMENT OF Rs 5000 GST already paid in Dec’19, in Jan’20 i.e. DECLARING Total Revenue for Jan’20 month BY LESS THAN RS 20000 in GSTR-3B and thus in a way adjusting it from Dec’19 Total Revenue ? If not, what is alternate way out in above case ??
- WHETHER FORFEITURE of advance amount is SUPPLY ??
chirag111 Posted new comment May 28, 2020
- As per Rule 50 of the CGST Rules inter alia the rate of tax and amount of tax charged need to be separetely mentioned on the receipt voucher. Thus mentioning it as inclusive wont work.
- Adjustment of GST can only be claimed where entire amount of advance ((incl tax) is refunded. In case of forfeiture, no adjustment is permitted and this will form part of reco.
- Can be said yes, as in case amount is not refunded and GST is adjusted by supplier, there will be unjust enrichment of such supplier to extent of GST which he has has collected and effectively not paid.
Team Clearmytax.in
Frah Saeed Answered question May 14, 2020
Sir, If Advance money is forfeited, then you told that it will form part of Reconciliation. Query- Pls tell the meaning of this line ??
2) In reply to 3rd query, GST is adjusted by supplier means– GST which is paid when advance was received and which has been adjusted against ITC . Am i right ?? If not pls correct me ??