TALLY MADE EASY FOR GST ACCOUNTING
The Goods and Services Tax Act, 2017 came into force with
effect from 1.7.2017.
First request. If you are not having Tally erp9 latest version, please download Educational Version and then continue.
When a new Act or Rule introduced in taxation, the method of accounting were to be modified as per the revised Acts and Rules in order to provide the required particulars prescribed by the Government to the tax authorities.
When a new Act or Rule introduced in taxation, the method of accounting were to be modified as per the revised Acts and Rules in order to provide the required particulars prescribed by the Government to the tax authorities.
In this article the company creation, head of accounts
creation, and invoice preparation guidelines under Goods and Services Tax Act
using Tally erp9 software were given for easy understanding.
COMPANY
CREATION
Please open the Tally erp9 software and in the Gateway of
Tally. Please press Alt F3. A new window Company Info will be visible. In the
Company Info window click Create Company.
In the new window please enter Name of the Business
Establishment, or Shop, Factory or Service Provider details and then fill
Address, Country, State, Pincode, Phone No, Mobile No., Fax No, Email ID,
Website details and Books and Financial year Details etc and then save.
Now the name entered will be visible in the Name of
Companies list.
Now Click F11: Features. A new Window Company Features
will be visible. In the Window please
click Accounting Features and in the window fill the required details.
Then click Inventory Features and in the Inventory
Features window fill the required fields as Yes.
Now press Statutory & Taxation button. In the new
Statutory and Taxation window fill Yes against the Enable Goods and Services
Tax (GST) and in the next field i.e. Set/alter GST Details fill yes and a new
window will be visible.
In the next GST Details window fill the name of the
State, Registration type, GSTIN/UIN details, Applicable from 1.7.2017 and
enable GST Classifications.
Then fill yes in the Enable Value Added Tax (VAT) and in
the next VAT Details window fill the name of the State, Tin, Inter-State Sales
Tax Number details and then complete the window by entering PAN/Income Tax
Number and Corporate details etc.
LEDGER CREATION
Now in the Gateway of Tally window click Accounts Info.
Now Accounts Info window will be visible with Groups, Ledgers, Voucher Types,
Statutory Info and Quit buttons.
Now click Groups. Click Display Button. There are 34 Groups
by default in Tally which is suitable for transactions.
Now click Ledgers in Tally. Only two legers were
available in Tally i.e. Cash and Profit & Loss Account.
Other Ledgers were to be created according to business or
services or other categories.
Create Purchase and Sales Ledgers without mentioning Tax
Rate details.
Under Goods and Services Tax Act, 2017 there are three
types of taxes namely:
1) IGST
– Integrated Goods and Services Tax,
2) CGST
– Central Goods and Services Tax, and
3) State
or Union Territory Goods and Services Tax.
Now click Ledgers and enter IGST in the Name field and
then choose Duties & Taxes and then choose GST against Type of duty/tax and
then choose Integrated Tax against Tax type and complete the form without
entering any details against Percentage of Calculation.
Now click Ledgers and enter CGST in the Name field and
then choose Duties & Taxes and then choose GST against Type of duty/tax and
then choose Central Tax against Tax type and complete the form without entering
any details against Percentage of Calculation.
Now click Ledgers and enter SGST in the Name field and
then choose Duties & Taxes and then choose GST against Type of duty/tax and
then choose State Tax against Tax type and complete the form without entering
any details against Percentage of Calculation.
For the Goods and Services suppliers in Union Territories,
click Ledgers and enter UTGST in the Name field and then choose Duties &
Taxes and then choose GST against Type of duty/tax and then choose State Tax
against Tax type and complete the form without entering any details against
Percentage of Calculation.
STOCK INVENTORY CREATION WITH HSN CODE
Press Inventory Info Button.
Choose Units of Measures and Create Units like Kilogram,
Kilolitre, Litre, and Millilitre. Meter, Millimetre, Grams, Milligram, Number
etc.
Now choose Stock Groups.
Create Stock Groups which will come under one HSN Code.
For example: 1) Bearings, 2) Cement, 3) Gloves for Sports,
4) Jaggery, 5) Other Oil Seeds, 6) Writing inks.
Now create Stock Items under each group.
Click Inventory Info in the Gateway of Tally. A new
Inventory Info window will be visible and in the window click stock items. Now
click Create button. Now Stock Item Creation window will be visible.
Even though the HSN Code is
same the rate of GST will differ. The GST rate of tax has to be mentioned for
each category separately.
In that window enter the name of the commodity against
Name (alias) and then choose group and then choose Unit category.
In the Statutory Information choose Applicable, against
GST Applicable and then choose Yes against Set/alter GST Details.
Now a new window Tax Rate Details will be visible. In that window enter the name of the
commodity against Description and the HSN/SAC Code and then choose Calculation
type as On value and then choose Taxable against Taxability and then enter the
GST Rate against Integrated Tax and the Central and State Tax Rates will be
auto populated. If the commodity
attracts Cess enter the rate of Cess and then choose Goods.
Try to create the following items:
Bearings: Ball Bearings, Roller Bearings (HSN 8482)
Cement: Aluminous Cement, Portland Cement, Slug Cement,
Super Sulphate Cement (HSN 2523)
Gloves for Sports: Hand Gloves for sports, Leg Gloves for
sports (HSN 4203)
Jaggery: Can Jaggery, Palmyrah Jaggery (HSN 1701)
Other Oil Seeds: Castor Oil Seeds, Cotton Seeds, Kokam
Seeds, Niger Seeds, Palm Nuts and Kernels, Poppy Seeds, Safflower Seeds and
Sesamum (HSN 1207)
Writing Inks: Fountain Pen Ink, Ball Pen ink (HSN 3215)
Aerated Water (HSN 2202 1010) This item will attract 28% IGST for inter-State supplies and 14% CGST and 14% SGST for intra-State supplies. This item will also attract cess at 12%. The Cess will be applicable for intra-State transactions and inter-State transactions without any difference.
Aerated Water (HSN 2202 1010) This item will attract 28% IGST for inter-State supplies and 14% CGST and 14% SGST for intra-State supplies. This item will also attract cess at 12%. The Cess will be applicable for intra-State transactions and inter-State transactions without any difference.
Now choose Tax
Rate Set up in the Inventory Info window and then choose GST and then Choose
Set Rate on the right side panel and fill the rate of tax details and HSN Code
Details.
This is only sample guidelines.
Now the Stock Inventory is ready with HSN Codes.
PARTY LEDGER CREATION
Now click Accounts info in the Gateway of Tally and then
click Ledgers and then click Create.
In the Name field enter the name of the supplier or
seller to you and choose Sundry Creditors and then fill address details and Tax
Registration Details etc.
Similarly, in the Name field enter the name of the buyer
or recipient or customer who buys goods from you and choose Sundry Debtors and
then fill address details and Tax Registration Details etc.
While filling the details choose Composition or Regular
or Consumer or Unregistered without fail. If there is any omission, there will
be mismatch in returns.
PACKING CHARGES UNDER GST
The packing charges and freight charges will attract GST
under the Goods and Services Tax Act, 2017.
The rate of GST for the packing charges will be equal to
the rate of tax for goods. Similarly the freight charges will be equal to the
rate of GST for goods.
If packing charges is collected at percentage basis
double the amount will be added in the sale value. For example 2% packing charges
is collected, 2% CGST and 2% SGST will be applicable (Totally 4%).
To calculate packing charges in Tally erp9 create the
relevant head of accounts. Please
choose Accounts info in the Gateway of Tally. Click Create button in Ledgers.
Now enter Packing charges in the Name field and choose Indirect Expenses. Now
choose “Not applicable” against “Is GST Applicable”. Now the line Type of
supply will disappear and a new line will appear. Click GST against Include in
appropriate value calculation for and then choose Goods against Appropriate in
and then choose Based on Value against Method of Calculation. While preparing
supply invoices choose packing charges and enter the value. The amount noted as packing charges will
attract the Goods rate. Packing charges for exempted goods will not attract
GST.
FREIGHT CHARGES UNDER GST
To calculate freight charges in Tally erp9 create the
relevant head of accounts. Please
choose Accounts info in the Gateway of Tally. Click Create button in Ledgers.
Now enter Freight charges in the Name field and choose Indirect Expenses. Now
choose “Not applicable” against Is GST Applicable. Now the line Type of supply
will disappear and a new line will appear. Click GST against Include in
appropriate value calculation for and then choose Goods against Appropriate in
and then choose Based on Value against Method of Calculation. While preparing
supply invoices choose Freight charges and enter the value. The amount noted as freight charges will attract
the Goods rate. Freight charges for exempted goods will not attract GST.
REVERSE CHARGE MECHANISM UNDER GST
Under the Goods and Services Tax Act, 2017 if the goods
were not suffered tax at earlier stage Reverse charge Mechanism will be
applicable.
Reverse charge means the liability to pay tax is by
person receiving goods and/or services instead of the person supplying the
goods and/or services in respect of specified categories of supplies. In India, the concept of reverse charge under
GST is being introduced which already present in service tax. Reverse charge under GST may be applicable
for both services as well as goods.
Reverse Charge Mechanism is applicable in all cases of
supply from Unregistered Dealer to Registered Dealer under Section 9(4)
And
Reverse Charge Mechanism is applicable in all cases of
supply of specified goods and Services which are notified by the Government under
Section 9(3),
(Purchases of Cashew nuts, not shelled or peeled, Bidi
Wrapper Leaves (Tendu), Tobacco Leaves purchased from Agriculturists and Silk
Yarn from any person who manufactures silk yarn from raw silk worm cocoons for
supply of silk yarn by any registered person for goods).
In tally under purchase ledger create unregistered supplier
under Sundry Creditors and Purchases from Unregistered suppliers under Purchase
Accounts. (While creating item-wise
commodity Tax Rate Details please choose Yes against Is reverse charge
applicable.)
HOW TO ACCOUNT FOR RCM TRANSACTIONS
Enter Unregistered Supplier against Party A/c name and
commodity and then choose Purchases from Unregistered Supplier under Accounting
Details. After entering the transaction please verify by clicking Tax Analysis
(Detailed) which will disclose Taxable Value and Amount of Central Tax and
State Tax payable with rate of tax details.
Similar procedure may be followed for Goods Transport
Agency for freight charges etc.
LEDGER CREATION FOR INCOME DIRECT AND
INDIRECT
AND EXPENSES DIRECT AND INDIRECT
You can create ledger for income and expenditure based on
the above guidelines.
Now the Tally erp9 software is ready to use and you can
enter transactions and take print out of bills if necessary. You can view Profit and Loss Account, Balance
Sheet, Stock Summary, Stock analysis and you can also view by clicking display
button, the Trial Balance, Day Book, Account Books, Statement of Accounts, Inventory
Books Statements of Inventory, Statutory Reports for filing returns to the
Government Departments, Receipts and payments etc.
You can create a sample sale bill and if additional
particulars are required you can alter the necessary fields.
Under the Goods and Services Tax Act, the Place of Supply
must be mentioned in the Invoice.
Similarly HSN Codes must be mentioned and Rate of GST if necessary.
In order to provide the particulars in the Sale Invoice,
the following Print Option to be selected.
Choose any one of the bill to be printed. Click Print.
Before clicking yes please click Backspace button in the computer. Now a new
window Standard Sales Configuration will be visible and in that window choose
the following as yes.
·
Print Quantity Columns
·
Print rate column
·
Print discount column
·
Print Company’s Registration Details (for VAT
and CST Registration Numbers)
·
Print buyer’s tax registration number (for VAT
and CST Registration Numbers)
·
Print Order Details etc
·
Print Company GSTIN Number
·
Print Buyer’s GSTIN Number
·
Print GST% column
·
Print HSN/SAC column
·
Print State Name & State Code
·
Print Place of Supply
Follow the above procedure and learn tally
erp9 practically. Now you have completed 6 months basic course in Tally.
Be happy.
Certainly you will feel like an expert in Tally erp9 under GST.
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