Advance payments that are settled during invoice posting

The following tables shows the tax entries that are generated for the invoice when an advance payment is settled in various scenarios.

Transaction details	Example	Tax entries that are generated during settlement
Invoice = Payment	Invoice amount: 12,000.00 Payment amount: 12,000.00	Tax on the invoice is posted. Tax on the payment is reversed to prevent a double entry in the related voucher. IGST payable account Cr. 2,000.00. Related voucher: IGST interim payable account Cr. 2,000.00 IGST payable account Dr. 2,000.00
Invoice < Payment	Invoice amount: 6,000.00 Payment amount: 12,000.00	Tax on the invoice is posted. Tax on the payment is reversed to the extent of the invoice amount in the related voucher. IGST payable account Cr. 1,000.00. Related voucher: IGST interim payable account Cr. 1,000.00 IGST payable account Dr. 1,000.00
Invoice > Payment	Invoice amount: 24,000.00 Payment amount: 12,000.00	Tax on the invoice is posted. Tax on the payment is reversed to the extent of the payment amount in the related voucher. IGST payable account Cr. 4,000.00 Related voucher: IGST interim payable account Cr. 2,000.00 IGST payable account Dr. 2,000.00

Transaction details

Example

Tax entries that are generated during settlement

Invoice = Payment

Invoice amount: 12,000.00

Payment amount: 12,000.00

Tax on the invoice is posted.
Tax on the payment is reversed to prevent a double entry in the related voucher.
IGST payable account Cr. 2,000.00.

Related voucher:

IGST interim payable account Cr. 2,000.00

IGST payable account Dr. 2,000.00

Invoice < Payment

Invoice amount: 6,000.00

Payment amount: 12,000.00

Tax on the invoice is posted.
Tax on the payment is reversed to the extent of the invoice amount in the related voucher.
IGST payable account Cr. 1,000.00.

Related voucher:

IGST interim payable account Cr. 1,000.00

IGST payable account Dr. 1,000.00

Invoice > Payment

Invoice amount: 24,000.00

Payment amount: 12,000.00

Tax on the invoice is posted.
Tax on the payment is reversed to the extent of the payment amount in the related voucher.
IGST payable account Cr. 4,000.00

Related voucher:

IGST interim payable account Cr. 2,000.00

IGST payable account Dr. 2,000.00

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