When the project is settled but not invoiced, the following 5 steps should be followed:
Revenue recognition: First, you need to recognize the revenue of the project. According to the contract or agreement, determine the settlement amount and settlement date. The settlement amount is then credited to the main business income or other relevant accounts.
Provisional cost: For the cost of the project, if no invoice is received, a provisional estimate can be made first. According to the contract or agreement, the cost of the project is estimated and charged to the cost of main business or other relevant accounts.
Confirm VAT: If the project is a taxable item, VAT needs to be recognized. According to the tax law, VAT is calculated on the basis of the difference between sales and input tax. Therefore, VAT recognition is required based on the sales volume of the project and the estimated input VAT.
Payment of taxes: If the project is subject to VAT, the tax needs to be credited to the tax payable account. Then, the payment of the tax is made at the right time.
Adjustment after receipt of invoice: When the invoice for the project is received, the account needs to be adjusted. Adjust the provisional cost to the actual cost and the provisional VAT to the actual VAT. At the same time, uninvoiced revenues and costs need to be adjusted.
It should be noted that for uninvoiced projects, it is necessary to strengthen communication with customers, obtain invoices as soon as possible and carry out accounting processing. At the same time, it is necessary to comply with tax laws and regulations to ensure compliance with tax treatment.
In short, when a project is settled but not invoiced, proper accounting and tax treatment are required. Revenue, provisional cost, VAT recognized, tax payment and adjustment after receipt of the invoice need to be recognized. At the same time, it is necessary to comply with tax laws and regulations to ensure compliance with tax treatment.