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title description author ms.author ms.topic ms.custom ms.date ms.reviewer ms.search.region ms.search.validFrom ms.dyn365.ops.version
Payment of invoices that include tax
Learn about payment of an invoice that includes tax, including a step-by-step process and outline on validating financial entries.
epodkolzina
epodkolzina
how-to
bap-template
06/03/2019
johnmichalak
India
2019-06-01
10.0.4

Payment of invoices that include tax

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Follow these steps to post an invoice that includes sales tax.

  1. Go to Accounts receivable > Payments > Payment journal.
  2. Create a record.
  3. In the Name field, select a value.
  4. On the Setup tab, select the Amounts include sales tax check box.
  5. Select Lines.
  6. Create a customer advance payment journal.
  7. Select Functions > Settlement.
  8. In the Invoice field, select a value.
  9. Close the page.
  10. Save the record.
  11. Select Post > Post.
  12. Close the message that you receive.

Validate financial entries

Validate the financial entries by selecting Inquiries > Voucher.

The following table shows the tax entries that are generated when an invoice payment is made 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

 No tax entries are generated.
Invoice < Payment

Invoice amount: 6,000.00

Payment amount: 12,000.00

Note that if either a Harmonized System of Nomenclature (HSN) code or a Services Accounting Code (SAC) is defined for the journal, tax is calculated and posted on the journal amount.
  • Tax is calculated and posted on the payment amount.
  • Tax on the payment is reversed to the extent of the invoice amount in the related voucher.
  • IGST interim payable account Dr. 2,000.00.
  • IGST payable account Cr. 2,000.00.

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 without tax

 No tax entries are generated.

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