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VAT - accrue or not accrue if no invoice on hands


If the incoming service is done but I did not receive invoice yet shall we accrue this amount together with VAT (so to increase as well accrued liability on BS side by VAT amount).

E.g. incoming seriveces invoice will be 118 USD (including 18 USD of VAT) shall I do the accrual


Dt Expenses (P&L) - Cr Accrued Liab (BS) - 100 USD
Dt VAT (BS) - Cr Accrued Liab (BS) - 18 USD.

If not than is there any links to standards to proof this point.

asked May 24, 2017 in General IFRS Discussion by Reiss

2 Answers

0 votes
If you have received the service, then it is more prudent to accrue at least the service cost without VAT.

I am not sure the VAT laws in your country. If your VAT/Tax laws require to have the invoice before you can account for it then, you will have to follow that.
answered May 24, 2017 by Mysio Level 5 Member (23,120 points)
0 votes
1.  When Goods are bought and you have to pay both purchase value and VAT input or paid both, at that time, following journal entry will be passed.

Purchase Account Dr.  (Value of Purchase)

VAT Input Account Dr. ( VAT on Purchase)

Cash or Bank or Name of Creditor Account Cr. (Value of Purchase + VAT input)

When Goods are Sold and you have to receive both Sale Value and VAT Output or received both, at that time, following journal entry will be passed

Cash or Bank or Name of Customer Account Dr.  (Value of Purchase + VAT output)

Sale Account Cr. (Value of Sale)

VAT Output Account Cr. (VAT on Sale)

When We pay the Net VAT (Payable) to Government. At that time, following journal entry will be passed.

Net VAT Payable Account Dr. ( Excess of VAT Output over VAT Input)

Bank Account Cr.
answered May 24, 2017 by veshmalahotra Level 4 Member (9,780 points)


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