Post Sales Discount

Basheer PM
watch_later 3 years, 1 month ago

One of our customer had a reasonably higher outstanding of 3lakhs + payable to us. The transaction with that Customer was on continous running basis for past many years. To recover the amount quickly, we had offered to give a good Settlement Discount if he makes the outstanding NIL. After few instalments he settled the amount, and we had to give him settlement write off of about Rs.8000/-. in the process.

How to issue a Credit Note for the same, as the original invoices are not known exactly, and the discount spreads through all the years of transactions.  Should i raise a Credit note with GST ?. Please advice how to account for the same

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1 Answer

GST Payer watch_later 3 years, 1 month ago

You are only receiving the money for good supplied earlier, so question of charging GST does not apply here as there is no supply but only money received.

You can issue a normal credit note for discount without charging GST. Even if it was a post GST supply credit can be reversed only if it was documented through an agreement.

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