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Tally - ERP9 Book With GST

Accounting is the process of recording, classifying, and summarizing financial transactions and interpreting the results. The key concepts covered in the document include the basic accounting equation of assets = liabilities + capital, and the definitions of accounts like capital, expenses, income, and basic accounting terms like debit and credit. The document also provides an overview of the accounting software Tally, including how to create a company, common shortcuts, and how to organize accounts into groups like current assets, expenses, and sales.

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50% found this document useful (2 votes)

1K views

Tally - ERP9 Book With GST

Uploaded by

hatim

We take content rights seriously. If you suspect this is your content, claim it here.

Available Formats

Download as PDF, TXT or read online on Scribd

You are on page 1/ 1843

Basic Accounting

Basic concept of accounting

Accounting: It is an art of recording, classifying and summarizing in significant manner

and in terms of money, transactions and events which are of financial character and
interpreting the results thereof.

Business transaction: A business transaction is “The movement of money and

money’s worth form one person to another”. Or exchange of values between two parties
is also known as “Business Transaction”.

Purchase: A purchase means goods purchased by a businessman from suppliers.

Sales: Sales is goods sold by a businessman to his customers.

Purchase Return or Rejection in or Outward Invoice: Purchase return means the

return of the full or a part of goods purchased by the businessman to his suppliers.

Sales Return or Rejection out or Inward Invoice: Sales return means the return of
the full or a part of the goods sold by the customer to the businessman.

Assets: Assets are the things and properties possessed by a businessman not for
resale but for the use in the business.

Liabilities: All the amounts payable by a business concern to outsiders are called
liabilities.

Capital: Capital is the amount invested for starting a business by a person.

Debtors: Debtor is the person who owes amounts to the businessman.

Creditor: Creditor is the person to whom amounts are owed by the businessman.

Debit: The receiving aspect of a transaction is called debit or Dr.

Credit: The giving aspect of a transaction is called credit or Cr.

Drawings: Drawings are the amounts withdrawn (taken back) by the businessman from
his business for his personal, private and domestic purpose. Drawings may be made in
the form cash, goods and assets of the business.

Receipts: It is a document issued by the receiver of cash to the giver of cash

acknowledging the cash received voucher.
Account: Account is a summarized record of all the transactions relating to every
person, every thing or property and every type of service.

Ledger: The book of final entry where accounts lie.

Journal entries: A daily record of transaction.

Trail Balance: It is a statement of all the ledger account balances prepared at the end
of particular period to verify the accuracy of the entries made in books of accounts.

Profit: Excess of credit side over debit side.

Profit and loss account: It is prepared to ascertain actual profit or loss of the business.

Balance Sheet: To ascertain the financial position of the business. It is a statement of

assets and liabilities.
Types of accounts

Personal account: Personal accounts are the accounts of persons, firms, concerns
and institutions which the businessmen deal.

Principles: Debit the receiver

Credit the giver

Real Account: These are the accounts of things, materials, assets & properties. It has
physical existence which can be seen & touch.
Ex. Cash, Sale, Purchase, Furniture, Investment etc.

Principles: Debit what comes in

Credit what goes out

Nominal account: Nominal account is the account of services received (expenses and
Losses) and services given (income and gain)
Ex. Salary, Rent, Wages, Stationery etc.

Principles: Debit all expense/losses

Credit all income/ gains
Tally Erp.9
Tally is a complete business solution for any kind of Business Enterprise. It
is a full fledged accounting software.

Procedure for creating company in Tally

Double click on Tally icon on desktop. Alt+F3 Company info-Create company.

Accounts Only: To maintain only the financial accounts of the company.

Inventory (stock) management is not involved in it.

Account with Inventory: This is the default option, which allows maintaining both
the financial account of the company as well as the inventory of the company.

Select Company: We can choose the company which is already

created. Shortcut key - F1.

Shut Company: It is used to close the company which is opened. Shortcut key -
Alt+F1.

Alter: It is used to make alterations in the company creation like name, date,
maintain etc.

Quit: Exits from Tally. 1. Click on quit button.

2. Esc, Esc, Esc and enter.
3. Ctrl+Q

Short cut keys

Alt+F3 Company information menu

Enter To accept information typed into a field.

To accept a voucher or master.
To get a report with further details of an item in a report.

Esc To remove what has been typed into a field.

To exit a screen.

To indicate you do not want to accept a voucher or master.

Ctrl+A To accept a form wherever you use the key combination the screen
or report will be accepted as it is on this screen.
Ctrl+Q It quits the screen without making any changed to it.

Alt+C To create a master at a voucher screen.

When working within an amount field presses Alt+C to act as a
calculator.

Alt+D To delete a voucher.

To delete a master.

Ctrl+Enter To alter a master while making an entry or viewing report.

F2 Date

Alt+F2 Change period

Alt+F1 To see detail

F11 Features company

F12 Configuration options are applicable to all the companies in a data

directory.

Ctrl+N Calculator screen.

Ctrl+V Voucher mode (Cr. Dr)

Invoice mode (name of item, rate, quantity, and amount)
Gateway of tally-Accounts info-Group
Bank account Bank Account
Bank Od account Branch/division
Capital account Cash in hand
Current asset Current liability
Deposit Direct expenses
Direct income Indirect expense
Indirect income Duties and tax
Fixed asset Investment
Loans and advance Loan (liability)
Miscellaneous expenses Provisions
Retained earning Reserves and surplus
Purchase account Sales account
Secured loan Stock in hand
Sundry debtor’s Sundry creditors
Suspense Unsecured account
Meaning:

Current asset:
It is converted into cash with in a year. Ex. Bills receivable

Direct expenses:
These are the expenses which are directly related to manufacturing of
goods. Ex. Wages, factory rent, heating, lighting etc

Indirect expense:
These are the expenses which are indirectly related to manufacturing of
goods. Ex. Salary, rent, stationery, advertisement, printing

Depreciation: Decrease the value of the asset.

Sundry debtors: The person who is the receiver or customer

Sundry creditors: The person who gives or supplier.

Expenses Outstanding or Unpaid expenses or Expenses due:

Expenditure incurred during current year but the amount on which is not yet
paid. (Added to the expenditure on the debit side and entered on the liability side.)

Income received in advance or Income received but not earned

Income received during the current year but not earned or a part of which relates
to the next year. (Deducted form the concerned income on the credit side and entered
on the liability side)

Prepaid advance or Expenses or Prepaid expenses

Expenditure paid during current year but not incurred or a part of which relates
to the next year is called expenditure prepaid. (Deducted form the concerned
expenditure on the debit side and entered on the assets side)

Income outstanding or income earned but not received or Income accrued

Income outstanding means income earned during the current year but the
amount on which is not yet received (added to the concerned income on the credit side
and entered on the asset side)
Gateway of Tally-Accounts info-ledger-create

Ledger Group
Opening stock Stock in hand
Purchase Purchase account
Purchase return Purchase account
Fright charges Direct expenses
Carriage inwards or Purchases Direct expenses
Cartage and coolie Direct expenses
Octroi Direct expenses
Manufacturing wages Direct expenses
Coal, gas, water Direct expenses
Oil and fuel Direct expenses
Factory rent, insurance, electricity, lighting and heating Direct expenses
Sales Sales account
Salary Indirect expenses
Postage and telegrams Indirect expenses
Telephone charges Indirect expenses
Rent paid Indirect expenses
Rates and taxes Indirect expenses
Insurance Indirect expenses
Audit fees Indirect expenses
Interest on bank loan Indirect expenses
Interest on loans paid Indirect expenses
Bank charges Indirect expenses
Legal charges Indirect expenses
Printing and stationery Indirect expenses
General expenses Indirect expenses
Sundry expenses Indirect expenses
Discount allowed Indirect expenses
Carriage outwards or sales Indirect expenses
Traveling expenses Indirect expenses
Advertisement Indirect expenses
Bad debts Indirect expenses
Repair renewals Indirect expenses
Motor expenses Indirect expenses
Depreciation on assets Indirect expenses
Interest on investment received Indirect income
Interest on deposit received Indirect income
Interest on loans received Indirect income
Commission received Indirect income
Discount received Indirect income
Rent received Indirect income
Dividend received Indirect income
Bad debts recovered Indirect income
Profit by sale of assets Indirect income
Sundry income Indirect income
Loan from others Loan Liabilities
Bank loan Loan Liabilities
Bank overdraft Bank OD
Bills payable Current Liabilities
Sundry creditors Sundry creditors
Mortgage loans Secured loans
Expense outstanding Current Liabilities
Income received in advance Current Liabilities
Other liabilities Current Liabilities
Capital Capital account
Drawings Capital account
Cash in hand Cash in hand
Cash at bank Bank account
Fixed deposit at bank Deposit
Investments Investments
Bills receivable Current asset
Sundry debtors Sundry debtors
Closing stock Stock in hand
Stock of stationery Current asset
Loose tools Fixed asset
Fixtures and fittings Fixed asset
Furniture Fixed asset
Motor vehicles Fixed asset
Plant and machinery Fixed asset
Land and building Fixed asset
Leasehold property Fixed asset
Patents Fixed asset
Goodwill Fixed asset
Prepaid expenses Current asset
Income outstanding Current assset

Trading account: Buying and selling of goods.

Dr. Receiving aspect Giving

aspect Cr.
Direct expenses Amount Direct Income Amount
To Opening stock xxx By Sales xxx
To Purchases By (-)Sales
xxx xxx
return
To (-)purchase return xxx By Closing stock xxx
To Freight charges xxx
To Cartage and coolie xxx
To Lorry hire xxx
To Manufacturing expenses xxx
To Wages xxx
To Factory rent, fuel power xxx
To Gross profit (transfer to profit and loss
xxx
account)

To Profit and loss account: Actual profit and loss of the business
Indirect expenses or payments Amount Indirect income or receipts Amount
To Salary xxx By Gross profit xxx
To Postage and Telegram xxx By Interest on investment received xxx
To Telephone charges xxx By Interest on deposit received xxx
To Rent paid xxx By Interest on loans received xxx
To Rate and taxes xxx By Discount received xxx
To Insurance paid xxx By Discount received xxx
To Interest on bank loan xxx By Rent received xxx
To Bank charges xxx By Bad debts received xxx
To Printing and stationery xxx By Net loss xxx
To Discount allowed xxx
To Advertisement
To Carriage outward (sales)
To Depreciation on assets
To General expenses
To Traveling
To Bad debts
To Net profit

Balance sheet: Actual financial position

Liabilities Amount Assets Amount

Bank loan xxx Cash in hand xxx
Bank overdraft xxx Cash at bank xxx
Bills payable xxx Fixed deposit at bank xxx
Sundry creditors xxx Investments xxx
Expenses Bills receivable
xxx xxx
outstanding
Capital xxx Sundry debtors xxx
(-)drawings xxx Closing stock xxx
Net profit xxx Stock of stationery xxx
Furniture xxx
Plant machinery xxx
Land and building xxx
Motor vehicles xxx
Prepaid expenses xxx
Income outstanding xxx
Alt+F3 Company Creation
Gateway of tally-Accounting voucher

F4 Contra: Records funds transfer between cash and bank accounts.

Deposit into bank or Opened bank account Cr. Cash
Dr. Bank
Withdraw form bank Cr. Bank
Dr. Cash
F5 Payment: Record all bank and cash payments.
Paid or Give Dr.
Cr. Cash/bank (in case cheque)
F6 Receipt: Records all receipts into bank or cash accounts.
Received or Borrow or Take Cr.
Dr. Cash/bank (in case cheque)
F7 Journal: Records adjustments between ledger accounts.
F8 Sales: Records all sales.
Dr. Cash/party (incase of credit-party)
Cr. Sales
F9 Purchase: Records all purchase.
Cr. Cash/party (incase of credit-party)
Dr. Purchase
Journalize the following transactions

1. Commenced business with cash Rs.10, 000.

2. Deposit into bank Rs. 15,000
3. Bought office furniture Rs.3,000
4. Soled goods for cash Rs.2,500
5. Purchased goods form Mr X on credit Rs.2,000
6. Soled goods to Mr Y on credit Rs.3,000
7. Received cash form Mr. Y on account Rs.2,000
8. Paid cash to Mr X Rs. 1,000
9. Received commission Rs. 50
10. Received interest on bank deposit Rs. 100
11. Paid into bank Rs. 1,000
12. Paid for advertisement Rs.500
13. Purchased goods for cash Rs. 800
14. Sold goods for cash Rs. 1,500
15. Paid salary Rs. 500

Gateway of tally-Account info-Ledger-Create

Gateway of tally – Accounting voucher
Type of
Sl.No Key Voucher Ledger Group Principles Amount
account
Cr. Capital Capital
Personal Giver 10,000
account
1 F6 Receipt
Dr. Cash Cash in
Real Comes in 10,000
hand
Cr. Cash Cash in
Real Goes out 15,000
hand
2 F4 Contra
Dr. Bank Bank
Real Comes in 15,000
account
Dr. Office furniture Fixed asset Real Comes in 3,000
3 F5 Payment Cr. Cash Cash in
Real Goes out 3,000
hand
Dr. Cash Cash in
Real Comes in 2,500
hand
4 F8 Sales
Cr. Sales Sales
Real Goes out 2,500
account
Cr. X Sundry
Personal Giver 2,000
creditor
5 F9 Purchase Dr. purchase Purchase
Real Comes in 2,000
account
Dr. Y Sundry
Personal Receiver 3,000
debtors
6 F8 Sales
Cr. Sales Sales
Real Goes out 3,000
account
7 F6 Receipt Cr. Y Giver 2,000
Dr. cash Cash in
Real Comes in 2,000
hand
Dr. X Receiver 1,000
8 F5 Payment Cr. Cash Cash in
Real Goes out 1,000
hand
Cr. commission Indirect Credit all
Nominal 50
income income
9 F6 Receipt
Dr. cash Cash in
Real Comes in 50
hand
Cr. Interest on bank Indirect Credit all
Nominal 100
deposit income income
10 F6 Receipt
Dr. Bank Bank
Real Comes in 100
account
Cr. Cash Cash in
Real Goes out 1,000
hand
11 F4 Contra
Dr. Bank Bank
Real Comes in 1,000
account
Dr. Advertisement Indirect Debit all
Nominal 500
expenses expenses
12 F5 Payment Cr. Cash Cash in
Real Goes out 500
hand
Cr. Cash Cash in
Real Goes out 800
hand
13 F9 Purchase Dr. purchase Purchase
Real Comes in 800
Cr cash account
Dr. cash Cash in
Real Comes in 1,500
hand
14 F8 Sales
Cr. Sales Sales
Real Goes out 1,500
account
Dr. salary Indirect Debit all
Nominal 500
expense expenses
15 F5 Payment Cr. Cash Cash in
Real Goes out 500
hand
To view- Gateway of tally-Accounts info-Ledger -Multiple ledger Alter-All items
(for ledger)
Gateway of tally-Display-Day book-Alt+F1 (to see
detail) (Accounting Voucher)
Inventory information

Alt+F3 Company creation-Maintain-Accounts with inventory

Gateway of Tally-Inventory information-Unit of measure
Gateway of tally –Inventory information-Godown
Gateway of tally-Inventory information-Stock group
Gateway of tally – Inventory information-Stock item
To View
Gateway of tally-Display-Day book-Alt+F2 (change period) Alt+F1 (to see detail) or
Gateway of tally-Stock summary

1. On 1-4-06 Raman commenced business with cash of Rs. 25,00,000. He further introduced
Land and Building costing Rs. 30,000, Plant and Machinery costing Rs. 25,000 and furniture
and fixture costing Rs. 36,000.

2. On 2-4-06 Purchased Vehicle and Patents Rs. 20,000 and Rs. 15,000.

3. On 5-4-06 He deposited Rs. 1, 00,000 into Canara Bank.

4. On 6-4-06 Purchased from Cadbury Company

500 5 Stars @ Rs. 5 1000 Cadbury @ Rs. 5
100 Kit kat @ Rs. 4 200 Dairy milk @ Rs. 7

5. On 10-4-06 Purchased from Paras

500 Moov @ Rs. 20
500 D’Clod @ Rs. 12

6. On 13-4-06 Sold to Pankaj

200 Moov @ Rs. 20.50
100 D’Clod @ Rs. 12.25
200 Adhensive tape roll @ Rs. 15.25
100 Band Aid box @ Rs. 252
200 Boric Acid powder @ Rs.14

7. On 15-4-06 Sold to Akbar

500 Cadbury @ Rs. 6
200 5 Star @ Rs.5.25
50 Kit Kat @ Rs. 6

8. On 16-4-06 Paid to Cadbury company Rs.

9. On 18-4-06 Received from Pankaj

10. On 20-4-06 Paid to Paras Rs.

11. On 25-4-06 Received from Akbar Rs.

12. On 26-4-06 Purchase from Well Cloth

T-Shirts Lee-25Pc-Rs.200
Nike-30Pc-Rs.300
Formal Shirts Pan America-35Pc-400
Peter England-30Pc-450
Jeans Pants Tiger-20Pc-500
Ruff and Tuff-30Pc-350
Cotton Pants Arrow-40Pc-200
Ex-Calibar-20Pc-250

13. Paid Postage Rs. 500 by cheque

14. Received commission Rs. 15,000
15. Paid wages Rs. 2,500
Procedure for Inventory Problem

Gateway of Tally-Inventory Info-Unit of Measure-Create-

Symbol- Nos. Pcs
Formal Name-Number Pieces

Gateway of Tally-Inventory Info-Stock Group-Create

Chocolate, Medicines, Cotton Pants, Jeans Pants, Formal Shirts, T-Shirts

Gateway of Tally-Inventory Info-Stock Item-Create

5 Stars
Kitkat Chocolate
Cadbury
Dairy milk

Moov
D’Clod
Adhensive tape rolls Medicines
Band Aid box
Boric Acid powder

Lee T-Shirts
Nike

Pan America Formal Shirts

Peter England

Tiger Jeans Pants

Ruff and Tuff

Arrow
Ex-Calibar Cotton Pants
Journalize the following Transactions using the debit and credit
given by the American accounts

1. Commenced business with cash 10,000

2. Deposited into bank 5,000
3. Purchased goods for cash 3,000
4. Sold goods for cash 2,500
5. Purchased goods from A on credit 4,000
6. Sold goods to B on credit 4,500
7. Withdraw from bank 3,000
8. Paid A on account 2,000
9. Received from B on account 2,500
10. Took loan from C 5,000
11. Gave loan to D 4,000
12. Paid salary 1,000
13. Cash withdraw from the business for personal use 200
14. Rent paid to E 1,000

Ledger Group

Capital Capital Account

Cash Cash in hand

Bank Bank account

Purchase Purchase account

Sales Sales account

A Sundry creditor
B Sundry debtor

C Sundry creditor

D Sundry debtor

Salary Indirect expenses

Drawings Capital account

Rent Indirect expenses

Rakesh and company
1. Started business with cash Rs. 2,000, Bank Rs. 20,000.
2. Issued cheque for goods purchased Rs. 1,000.
3. Bought goods for cash Rs.8,000.
4. Bought furniture from Anil for cash Rs.100.
5. Bought goods from harish Rs. 1,500.
6. Bought goods from chandan on credit Rs. 5,800.
7. Returned damaged goods to Chandan Rs.800.
8. Bought goods from Naveen and paid by
cheque immediately Rs.400.
9. Sold goods to Guptha Rs. 1,000.
10. Received a cheque from Guptha Rs.1,000 for goods sold.
11. Paid commission Rs.2,000.
12. Paid wages by cheque Rs.4,000.
13. Draw cheque for personal use Rs.4,000.
14. Draw cash for personal use from bank Rs.3,000.
15. Receive a cheque from Manju Rs.2,800.
16. Borrow loan from Anands Rs.1,000.
17. Paid Anands Loan with interest Rs.1,000.

Ledger Group
Capital Capital account
Bank Bank account
Purchase Purchase account
Anil Sundry Creditor
Chandan Sundry Creditor
Harish Sundry Creditor
Purchase return Purchase account
Naveen Sundry Creditor
Sales Sales account
Guptha Sundry debetor
Commission Indirect expenses
Wages Direct expenses
Drawings Capital account
Manju Sundry Creditor
Anand Sundry Creditor
Haridas and company

1.Started business with cash Rs.10,000,furniture Rs.4,000 and machinery Rs.5,000.

2.Bought goods from Anil on credit Rs. 4,000 and for cash Rs.5,000.
3.Sold goods to Rajesh on credit Rs.5,000 and for cash Rs.3,000.
4. Bought goods from Arun Subject to trade discount of 2% of Rs.2,000.
5. Sold goods to Ramesh subject to trade discount of 5% of Rs.4,000.
6. Paid salary Rs.1,000, printing Rs.150 and wages rs.100.
7.Received rent Rs.500, commission Rs.400.
8. Received a cheque from Ganesh Rs.1,000.

Ledger Group
Capital Capital account
Furniture Fixed asset
Machinery Fixed asset
Purchase Purchase account
Anil Sundry Creditor
Sales Sales account
Rajesh Sundry debtor
Arun Sundry creditor
Ramesh Sundry debtor
Salary Indirect expenses
Printing Indirect expenses
Wages Direct expenses
Rent Indirect expenses
Commission Indirect expenses
Ganesh Sundry creditor
Trade discount Indirect expenses
Memorandum book
Particulars
1. Commenced business with cash Rs. 10,000.
2. Purchased goods for cash Rs.3,000.
3. Opened a bank account with Rs.2,000.
4. Purchased stationary Rs.1,00.
5. Purchased furniture Rs.1,000.
6. Sold goods to A Rs.2,000.
7. Purchased goods from B Rs.2,000.
8. Sold goods for cash Rs.1,000.
9. Paid for postage Rs.20.
10. Took loan from C Rs.1,500.
11. Paid rent Rs.300.
12. Withdraw from bank Rs.800.
13. Received from A on account Rs.500.
14. Paid commission by cheque Rs.200.

Ledger Group
Capital Capital account
Purchase Purchase account
Bank Bank account
Purchase Purchase account
Stationary Indirect expenses
Furniture Fixed asset
Sales Sales account
A Sundry debtor
B Sundry Creditor
Potage Indirect expenses
C Sundry Creditor
Rent Indirect expenses
Commission Indirect expenses
Roa and company

Particulars Rs.
1. Bought goods for cash 2,500
2. Bought office furniture for cash 500
3. Paid for postage 10
4. Purchased goods from Rajkamal 2,000
5. Sold goods for cash 150
6. Bought goods from Rahim 400
7. Sold goods to Suresh 400
8. Sold goods to Nayak 250
9. Purchased goods for cash 400
10. Recevied cash from Nayak 200
11. Paid cash to Rahim 50
12. Returned goods to Ralkamal 200
13. Suresh returned goods 50
14. Paid salary 150
15. Sold goods for cash 500
16. Rao withdraw for his personel use 800
17. Paid for stationery 100
18. Paid rent 50
19. Received commission 225

Ledger Group
Capital Capital account
Purchase Purchase account
Postage Indirect expenses
Rajkamal Sundry Creditor
Sales Sales account
Rahim Sundry Creditor
Suresh Sundry Debtor
Nayak Sundry Debtor
Purchase returns Purchase account
Salary Indirect expenses
Drawings Capital account
Stationary Indirect expenses
Rent Indirect expenses
Commission Indirect income
Creating a Company

Creating a Company involves providing basic information about the company whose books of
accounts are to be maintained in Tally.ERP 9.

Go to Gateway of Tally > (Alt+F3) Company Info. > Create Company

The Company Creation screen appears as shown:

A detailed explanation on each field is given:

• Click on S: Server List or press Alt+S

Not e: If the admi ni strator has e nabl e d Securi ty Acce ss, use rs ne e d to provi de the
authori se d Tal l y.NET cre denti al s i n order to acce ss the Se rve r Li st.

• The List of Tally.Servers is displayed. Select the required location

• Press Enter to continue with Company Creation

Name

Enter the name of the company whose books are being opened. If you are a professional accountant
and are maintaining the books of your clients, give the Client Company's name.
Mailing Name and Address

In addition to the Company Name, Tally.ERP 9 provides the facility to enter the Mailing Name field.
It displays the Company Name by default. You may change it as required, if the mailing name is
different from the Company Name. The mailing name and address details are picked up for inclusion
in any report that needs the company name and address as heading. For example: Balance Sheets,
Statement of Accounts, and so on.

Tally.ERP's reports print the mailing name and address as given:

Tally.ERP 9 does NOT restrict the number of lines for the address details. Tally.ERP 9
accommodates all the entered information and vertically compresses the same.

Not e: In the space provi ded for the Addre ss de tail s, obse rve the ve rti cal
compre ssi on as compare d to the Mail i ng Name fi el d whe re the re i s hori zontal
compre ssi on.

Y ou can spe ci fy any l e ngth for the mai li ng name and you are pe rmi tte d to gi ve any
numbe r of l i ne s for the addre ss. The i nformati on i s compl e tel y vi si ble .

Tall y.ERP 9 handl e s compre sse d i nformati on corre ctly w hil e pri nti ng. It adj usts the
re ports accordi ngl y.

Statutory compliance for

Select the Country from the List of Countries. The Statutory Features and Base Currency Symbol
are enabled in accordance with the country selected. For example, if the accounts belong to a
company in India, the base currency would be Indian Rupees. The Base Currency will appear with
respect to the Country selected.

Selecting India from the List of Countries brings up a State, Pin Code and Telephone No. field.

State

You can select the appropriate state from the predefined list.
PIN Code

Specify the PIN Code (Postal Index Number) of the specified address.

Telephone

Enter the Telephone number.

Mobile No

Enter the mobile number of the company.

E-mail Address

Enter the E-mail address that will be used to e-mail documents, reports and data from Tally.ERP 9.

Enable Auto Backup

Set this to Yes, if you want to enable the automatic backup of Tally.ERP 9 data (per company). Else, set
this to No. The data backup is stored in the data folder of the respective company. The auto backup data
can be restored by pressing Ctrl+Alt+Kfrom Company Info menu or Gateway of Tally.

Not e: Ensure that al l the syste ms i n a ne tw ork have the

same dat e and ti m e se tti ngs.

Currency

Currency symbol is the symbol of the base currency, that is, the currency that will be used to
maintain the books of account.

The symbol ` appears by default in case India for India/SAARC Companies and the field is left blank
for International Companies.

Not e: The currency sym bol change s base d on the country se le cte d from the l ist
for S t at ut ory com pli ance f or fi el d.

Click here to read about Indian Rupee Symbol Conversion.

Maintain

Tally.ERP 9 displays a drop down for the Type of Company with two options Accounts
only and Accounts with Inventory

Select Accounts only if you do not have any inventory transactions (suitable for professionals and
corporate offices).

However, at a later date (if required) you can choose to alter the information as Accounts-with-
Inventory. SelectAccounts-with-Inventory, to maintain both financial accounts and inventory.
Financial Year From

In most countries, the books of accounts of a company are maintained for a stipulated period like,
12 months, 15 months, and so on. This stipulated period is referred to as the Financial Year.

The stipulated period of the financial year is 12 months in most countries. Tally.ERP 9 automatically
considers 12 months from the date you give here as the Financial Year.

For example, if you enter April 1, 2008 as the date, the Financial Year will be from April to March
ending with March 31, 2009. If you enter October 1, 2008 as the Financial Year From then the
financial year will be from October 2008 to September 2008 ending with 30th of September every
year.

Tally.ERP 9 allows you to maintain data for multiple years by changing the period (Alt+F2) at the
Gateway of Tally. In addition, you can also specify the date of actual establishment of the company
(date of incorporation)

Books Beginning From

Tally.ERP 9 presumes that you wish to maintain books from the beginning of the financial year.
Hence, Tally.ERP 9 displays the date given in Financial Year From field automatically.

The date for Books beginning from can be changed, in case of companies, which are incorporated in
the middle of the year. If your company is new, you can opt to start the books of accounts from the
date of actual establishment of the company (date of incorporation) but close books according to
the Financial Year as specified by you. Tally.ERP 9 provides the required flexibility in such a case by
allowing you to give the date when the books of accounts actually began. Tally.ERP 9 will open
books from this date and close as on the last day of the Financial Year.

For example, if your company is established on August 19, 2008, the opening balances for all the
accounts can be given as on August 19, 2008 even though the Financial Year given is April 1, 2008
(April to March financial year). The company's books will begin on August 19, 2008 and close on
March 31, 2009, which ensures smooth transition to the next year.

This concept can be applied even when you are migrating to Tally.ERP 9 from any other system or
from a manual accounting system on any day during the Financial Year. Close books in that other
system on the previous day and start books on Tally.ERP 9 from this day. You are allowed to give
opening balances of all Ledger accounts including Revenue accounts.

TallyVault Password

TallyVault is an enhanced security system, which allows for encryption of the company data.
Encryption involves converting normally accessible Tally information into unrecognisable
information, which can only be reconverted by authorised persons.

Give a password here and repeat the same in the Repeat field. This basically results in the creation
of an encrypted company whose information is not accessible to users other than the password
holder.

Password Strength

Password Strength indicator is available in Tally.ERP 9 from Release 4.5 onwards. Now, strength
is displayed while creating / altering passwords under Security Control, Tally Vault, and Control
Centre. Also when Password Policy is enabled, Password Strength is indicated in the Change
Password screen that appears for first time login.

Let us understand the logic used by Tally.ERP 9 to ascertain a password’s strength. This logic
consists of two sets of conditions to be applied.

A. Password Score

B. Password Length and Username match

Use Security Control?

Set this to Yes, if you want to initiate a password-protected system to control access to Tally.ERP 9
data. Else, set this to No.

If you opt for security control, Tally.ERP 9 offers a comprehensive password based access control to
different features of Tally.ERP 9 based on authority lists created by the Administrator. For more
information refer Data Management in Tally.ERP 9.

Name of Administrator, Password, Repeat

Assuming the Tally Vault Password and Use Security Control is set to Yes enter the Name of
Administrator, Password andRepeat in the respective fields.

Use TallyAudit Features

Tally Audit allows the administrator or an auditor profile user to track changes in accounting
information. If you wish to use this facility, select Yes. Tally Audit will be available only to the
administrator/auditor, through Display of Statements of Accounts.For more information refer Data
Management in Tally.ERP 9.

Disallow opening in Educational mode ?

Set this option to Yes, if you don't want the company to be opened in Educational mode of
Tally.ERP 9. Else, set this to No.

On accepting the company creation screen, if you have specified Tally Vault password, Tally.ERP 9
prompts you to enter the TallyVault password as appears:
Then Tally.ERP 9 prompts you to enter the Name of User and Password (if any).

After verification Tally.ERP 9 imports the latest statutory masters. Wait till the screen shows that
100% of import is complete.
This completes the Company Creation process in Tally.ERP 9.

An explanation on the fields on the bottom of the Company creation screen follows:

Base Currency Information

The Base Currency Information is found in the bottom frame of the Company creation Screen.
Base Currency is the currency in which your accounts would be maintained. Financial statements
are prepared in the base currency by default and these are normally required to be submitted to
local statutory authorities. The Base Currency information in Tally.ERP 9 varies with the country
selected for Statutory Compliance.

You can record transactions and raise invoices in foreign currency; and also maintain bank accounts
or ledgers in foreign exchange, when required.

Base Currency Symbol

The currency symbol given earlier in the Company Creation screen is displayed here
automatically.

Tally.ERP 9 uses this currency symbol in reports, wherever necessary.

Click here to read about Indian Rupee Symbol Conversion.

Formal Name

Formal Name is the full name of the currency specified.

The Formal Name for the base currency is set to Indian Rupees for Indian Companies.

Number of decimal places

The number of decimal places for the base currency is set to 2, by default. However, you have the
option of specifying up to 4 decimal places. Indian currency has 2 decimal places whereas certain
other countries require 3 decimal places and so on.

Is Symbol Suffixed to Amounts

For countries, which specify the symbol after the amount (value) – this facility is provided. For
example, Yen is specified after the amount (5000 Yen) unlike in India where the symbol is specified
before the amount (Rs.5000)

Symbol for Decimal Portion

Enter the symbol for decimal portion.

Show Amounts in Millions

This is useful for companies, which require reporting the financial statements in millions. This is
possible only if Allow Multi-Currency is enabled in F11: Accounting Features.

Put a space between Amounts and Symbol

This facility is provided to users who require a space between the amount and the symbol.
However, putting a space between the amount and symbol could give an opportunity for misuse
incase of cheque printing. Hence, the flexibility to turn this option on and off as required is
provided.

Decimal Places for Printing Amounts in Words

You can specify the number of decimal places for printing the amount in words. This number
should be equal to or lesser than the number specified in Number of Decimal places field in
company creation or currency master screen which will appear in Invoice and Cheque printing
screen.

For example, if the currency is expressed upto 3 decimal places, the numeric to be printed in words
can be restricted to 2 decimal places.

Not e: The Nam e of t he Com pany, cannot be translate d or transli te rate d but w il l
appe ar i n the
Loading a Company

In order to load a company using the Select Company option, disable the default loading of a
company in Tally.ini file. SetDefault Companies to No OR place a semi-colon before Load = 00001
(company number - placing a semicolon means that the words following it in that line would not be
executed. Each line is a separate command).

On double-clicking the Tally icon, the screen is displayed as shown:

You can use the Select Company option in two ways, from the Company Info. Menu OR by using
the button F1: Select Cmp(available on the Gateway of Tally screen).

Select Company

Select Company option allows you to load another company from the list of companies listed which
you may have created earlier.

Press Enter on Select Company or use the button F1: Select Cmp. Tally.ERP 9 displays the
following screen:
If your business uses Tally.Server 9 to maintain data,

Click on S: Server List or press Alt+S

Not e: If the admi ni strator has e nabl e d Securi ty Acce ss, use rs ne e d to provi de the
authori se d Tal l y.NET cre denti al s i n order to acce ss the Se rve r Li st.

The List of Tally.Servers is displayed. Select the required location

The Companies available on the selected Tally.Server will be displayed:

Tally.ERP 9 displays

1. Company Name (All the companies created are displayed in an alphabetical order)

2. System-generated code for each company displayed

3. The Financial Year information relating to the number of years data present in the
company

Not e: The syste m- ge ne rate d code for e ach company i s di spl aye d to assist you in
i de nti fyi ng whi ch company you w i sh to w ork on i n case you have mul ti ple compani e s
w i th the same name ( as displ aye d i n the above scre en) .

Select the required company from the list given to go to the Gateway of Tally for that company.

In case two or more companies are loaded , click on the company which you need to work on so that the
selected company will be highlighted and will appear on top of the list.
Shut a Company

Shut a Company is to unload it. It does not mean that you have deleted it. Simply select it again
to load and work on it again.

You can shut a company in two ways – either using the button F1: Shut Cmp (Alt + F1) or
pressing Enter on Shut Companymenu option on the Company Info. Menu.

The screen appears as shown below:

Select the company to be shut from the List of Primary Companies.

Alter a Company

This option allows you to alter information about the existing company, you can modify any
information at any time that is set while creating a company.

Go to Gateway of Tally

1. Select F3: Cmp Info. (ALT+F3) from the button bar

2. Select Alter and press Enter and the screen appears as shown below:

3. Select the company from the List of Companies and press Enter to view the Company
Alteration screen.
4. Make the necessary changes in the required fields and accept the screen.

To change the password if Use Security Control is set to Yes:

1. Enter the Name of Administrator.

2. Enter the new password.

3. Re-enter the password in the Repeat field to confirm.

4. Enter the Old Password and Accept the screen to alter the company.
Not e: To unde rstand the condi ti ons that de termi ne a Passw ord's stre ngth,
cl ick Passw ord S t rengt h Indi cat or.

Delete a Company

This option allows you to delete an existing company.

To delete a company, you have to load the company first.

1. Select F3: Cmp Info. (ALT+F3) from the Gateway of Tally to proceed to the
Company Information menu.

2. Select Alter and press Enter.

3. Select the company to be deleted. The Company Alteration screen is displayed.

4. Use Alt + D to delete. Tally.ERP 9 will prompt for a confirmation on deleting the
company.

5. Press Enter to delete the company.

Not e: D e le ti on of a company i s i rre ve rsi ble . The company i s pe rmane ntl y del eted
from the syste m.
Pre-defined Groups in Tally.ERP 9

By default, Tally.ERP 9 provides a list of Groups called pre-defined groups. The user can create
any number of Primary Groups and Sub Groups which are again grouped under a Primary
Group/Sub Group.

There are 28 pre-defined Groups in Tally.ERP 9, out of which 15 are Primary Groups and 13
are Sub-Groups.

15 Primary Groups 13 Sub Groups

Branch / Divisions Bank Accounts
Capital Account Bank OD A/c
Current Assets Cash-in-hand
Current Liabilities Deposits (Asset)
Direct Expenses Duties & Taxes
Direct Incomes Loans & Advances
(Asset)
Fixed Assets Provisions
Indirect Expenses Reserves & Surplus
Indirect Incomes Secured Loans
Investments Stock-in-hand
Loans (Liability) Sundry Creditors
Misc. Expenses (ASSET) Sundry Debtors
Purchase Accounts Unsecured Loans
Sales Accounts
Suspense A/c

Out of the 15 Primary Groups, 9 Primary Groups appear in the Balance Sheet which are Capital in
nature and 6 Primary Groups appear under Profit & Loss Account which are Revenue in nature.

13 Sub Groups are classified under the 15 Primary Groups and they appear in the Balance Sheet.

Pre defined Sub Under

Groups
Bank Accounts Current Assets
Bank OD A/c Loans (Liability)
Cash-in-hand Current Assets
Deposits (Asset) Current Assets
Duties & Taxes Current
Liabilities
Loans & Advances Current Assets
(Asset)
Provisions Current
Liabilities
F-12 Configure
Attitude Academy
F12: Configure
General
Numeric Symbols
Accts / Inventory Info.
Voucher Entry
Invoice / Orders Entry
Payroll Configuration
Printing
E-Mailing
Data Configuration
Message Centre
Product & Features
Advanced Configuration
Licensing
You can configure Country Details, Style of Names, Style of Dates,
Configuration of Numbers in the General configuration screen.
Go to Gateway of Tally > F12: Configuration Menu > General
This enables you to set the number styles. The default styles and
symbols are specified. However, you have the option of changing them
in the respective fields according to your preference.
For example, change negative sign from (-) to (+).
Go to Gateway of Tally > F12: Configure > Numeric Symbols
Here you can configure the details you want in the masters over and above
those provided by fault. You can access the F12: Configure screen from
Accounts Masters and Inventory Masters when required. The fields
pertaining to both Accounting and Inventory Info. can be configured here.
Go to Gateway of Tally > F12: Configure > Accts/Inventory Info.
This option allows you to configure the vouchers entries in Tally.ERP 9,
both the Accounting and Inventory Vouchers can be configured from
this menu for additional information.
Go to Gateway of Tally > F12: Configure > Voucher Entry
This allows you to configure invoice, delivery notes and sales &
purchase orders. The Invoice entry and Order entry screens can be
configured for additional information such as export details, shipping
details, etc.
Go to Gateway of Tally > F12: Configure > Invoice/Orders Entry
This allows you to configure the BRS Report and alter the Reconciled
Vouchers.
Go to Gateway of Tally > F12: Configuration Menu > Banking
Configuration
The printing option allows you to configure the printing parameters of a
Voucher, Invoice and Statement layouts before final printing.
Go to Gateway of Tally > F12: Configure > Printing
The General Printing Configuration will help you to setup the print
screens for various reports and transactions.
This Configuration is applicable to all the reports that are printed from
Tally.ERP 9.
The Advanced Printing Configuration provides: Optimize usage of space while printing
in pre-printed format of invoice Support printing of POS invoice for customized paper
sizes Enable usage of bitmap printing as an option to avoid overlapping and
compression of text To use the advanced configurations, Go to Gateway of
Tally>F12: Configure>Printing>Advanced Printing Configuration
The Purchase printing option allows you to configure the printing of
Purchase Invoice, Purchase Orders and Receipt Note.
Go to Gateway of Tally > F12: Configure > Printing > Purchase
Transactions
This screen allows you to configure a purchase invoice for
printing. The Print Configuration settings shown below is applicable to
purchase voucher type only.
This screen allows you to configure the Receipt Note for
printing. The Print Configuration settings shown below is
applicable to receipt note voucher type only.
This allows you to configure the Purchase Order for printing. The Print
Configuration settings is applicable to Purchase Order voucher type.
This allows you to configure the dimensions and details of payment
voucher, you can set the size, top margin of voucher, leave space on
voucher for signature / verification purpose and decide the amount of
information you wish to print.
This configuration is applicable to Payment voucher type.
The Sales printing option allows you to configure the printing of Sales
Invoice, POS Invoice, Delivery Note, Sales Order and Quotation.
Go to Gateway of Tally > F12: Configure > Printing >Sales
Transactions
This screen allows you to configure Sales Invoice for printing. The Print
Configuration settings is applicable to sales voucher type only.
This allows you to configure POS Invoice for printing, Title of the
Document can be changed, you can print the Serial No., Batch Details,
Card / Cheque No., Tax analysis of items, Narration and Default Name
& Address of Party.
This configuration is applicable to Sales voucher type having the
POS option enabled.
This screen allows you to configure Delivery Note for printing. This Print
Configuration settings is applicable to Delivery Note voucher type.
This screen allows you to configure Sales Order for printing. The Print
Configuration settings is applicable to Sales Order voucher type.
This allows you to configure the dimensions and details of receipt
voucher, you can set the size, top margin of voucher, leave space on
voucher for signature / verification purpose and decide the amount of
information you wish to print.
This configuration is applicable to Receipt voucher type.
This allows you to configure the dimensions and details of
Journal/Contra voucher. This Print Configuration settings is applicable

only to Journal and Contra voucher type .

This allows you to configure the dimensions and details of Debit / Credit
Note, you can set the size, top margin of voucher, leave space on
voucher for signature / verification purpose, you can print the full ledger
details like inventory details, bill-wise details, cost centre details and
narrations.
The Reminder Letters feature in Tally.ERP 9 is used to send the
outstanding Aging report to a customer in the form of Letter. You can
also configure the letter in the Reminder Letter Configuration settings.
Go to Gateway of Tally > F12 Configuration > Printing > Reminder
Letters
Confirmation Statements is used to send confirmation of account
balance to customers, suppliers, lenders and borrowers.
You can configure the Confirmation Statement as per your
requirement.
Go to Gateway of Tally > F12 Configuration > Printing >
Confirmation Statements
Payment Advice slip is sent along with the payment voucher
containing the payment details and requesting an acknowledgement for
the remittance made.
You can configure the Payment Advice as per your requirement.
Go to Gateway of Tally > F12 Configuration > Printing > Payment
Advice Configuration
F11 Features in Tally.ERP9
F11 Features in Tally.ERP9

F11 features in Tally.ERP 9

• This feature enables you to set the various
Accounting Features required for
transaction entries.
• Go to Gateway of Tally > F11: Features
> F1: Accounting Features
Integrate Accounts and Inventory
This option has a significant effect on the
Balance Sheet and Profit & Loss
Account. If set to Yes, it extracts the
stock/inventory balance figures from the
inventory records and provides a drill
down to the Stock registers from the
Balance Sheet.
If set to No, it ignores the inventory
books figures and picks up manually
entered closing stock balances from the
ledger account created. This facilitates
the maintaining of accounts and
inventory separately.
Stock records often contain
compensating errors caused by wrong
allocation to items. This feature enables
finalization of financial books without
waiting for the reconciliation of stocks.
Income/Expense Statement
Instead of P & L

By Default, this option is set to

No.

If set to Yes – Tally.ERP 9

displays Income & Expenses A/c
instead of Profit & Loss A/c in the
Gateway of Tally.ERP 9 Menu.
Income and Expenditure
statement generally used for
Non-Trading accounts and Profit
& Loss a/c are used for trading
accounts.
Allow Multi-Currency
By Default, this option is
No.
Set this option to Yes, if
you want to create
multiple currencies and
the Menu Currencies is
displayed in .
Maintain Bill wise Details
The Bill-wise facility is made
functional by setting this
option to Yes. By activating
the Billwise feature, the
ledger masters under
Sundry Debtors and Sundry
Creditors automatically
displays an additional
option called Maintain
balances bill-by-bill. On
setting this option to Yes,
an additional option Default
Credit Period is displayed.
Activate Interest calculation
Set this option to Yes to enable
Tally.ERP 9 to calculate interest
automatically based on the interest
rate and style of calculation
specified. Enabling this option
allows interest calculation on
outstanding balances for any
ledger account or on each invoice
for the period it is outstanding
completely or partly.
Use advanced parameters
The advanced parameters are
useful when interest rates change
from time to time. Set this option to
Yes to enable this function.
Management
Maintain Payroll
Set this option to Yes if
you want to maintain
Payroll information on
Tally.ERP 9 for the
selected company .
A Cost Centre can be defined as a
unit of an organization to which
transactions can be posted. When
only costs or expenses are allocated
to these units, they are referred to as
Cost Centres. The Cost Centre
feature is activated by setting this
option to Yes.
Use Cost Center for Job Costing
Set this option to Yes to track all
income and expenses for a
Job/Project.
More than ONE Payroll/Cost
category
Set this option to Yes to create
more than one Payroll or Cost
Category.
Use Pre-defined Cost Centre
Allocations during Entry
Set this option to Yes to define
Cost Centre Allocations. Refer
Cost Centres and Cost
Categories for details.
Show Opening Balance for
Revenue Items in Reports
Set this option to Yes to display
the opening balance in Cost
Centre Report for the cost
centres which are allocated to
the Ledgers, grouped under
Income and Expenses Group.
Invoicing
Allow Invoicing
Set this option to Yes, to
create Sales and Purchase
vouchers in the invoice
format. The advantage of
using the invoice format for
sales invoice entry is that it
enables automatic
calculations of Duties and
Taxes accounts.
Enter Purchases in Invoice
Format
Set this option to Yes, to
enable voucher class option

in purchase voucher type .

Use Debit/Credit Notes
The Debit Note and
Credit Note voucher
types are made available
only if this feature is set
to Yes.
Use Invoice Mode for
Credit Notes
Set this option to Yes to
create Credit Notes in
Invoice Mode.
Use Invoice Mode for
Debit Notes
Set this option to Yes to
create Debit Notes in
Invoice Mode.
Budgets & Scenario
Management
Maintain Budgets and Controls
Set this option to Yes, to create
multiple budgets. The Budgets
menu option is displayed in
Gateway of Tally > Masters
Info. > Accounts Info. menu.
Use Reversing Journals &
Optional Vouchers
Setting this option to Yes
displays the Scenario option in
Accounts Info menu. You will
now be able to create and alter
Scenarios. You can enter the
Reversing Journal and make it
Optional, so that the entries do
not to affect the books.
Banking Features
Enable Cheque
Printing
Set this option to Yes,
to enable Cheque
Printing. Refer
Cheque Printing for
details.
Alter Banking
Features
Set this option to Yes
to alter features with
respect to Banking.
Refer Banking
Features for details .
Other Features
Allow Zero Valued Entries
in Vouchers
Set this option to Yes, to
allow Zero valued entries in
vouchers.
Maintain Multiple Mailing
Details for Company &
Ledgers
Set this option to Yes, to
maintain multiple mailing
details for your company and
ledgers. Refer Multi Address
for details.
Set/Alter Company Mailing
Details
If this option is set to Yes,
Tally.ERP 9 will allow you to
alter the Create/Alter
Address Types.
Enable Company Logo
This option allows to print the
company's logo on the
selected vouchers, reports
and invoices.
Set this option to Yes, the
Company Logo screen
appears. Specify the path of
the logo image file under
Location of Logo (E.g.
C:\Tally.ERP9\CompLogo.b
mp). The Company's logo is
printed on the top left of the
respective voucher, report or
an invoice.
General
Integrate Accounts and
Inventory
This field performs the
same function as
explained in Accounting
Features.
Allow Zero Valued
Entries in Vouchers
Set this option to Yes, to
allow zero valued entries
in Inventory vouchers.
Storage & Classification
Maintain Multiple
Godowns
Set this option to Yes, if you
have more than one stock
point/storage Locations/
Godowns, and you want to
track stock movement
across these Locations.
You can create any number
of Stock.
Maintain Stock
Categories
Set this option to Yes,
if you wish to create
and maintain Stock
Categories. This
creates a new field
Category in the Stock
Item Creation screen.
Maintain Batch-Wise Details
Set this option to Yes, to maintain
batch information pertaining to
Stock Items. A new field Maintain in
Batches is displayed in the Stock
Item Creation screen.
Set Expiry Dates for Batches
Set this option to Yes, if you want to
set expiry dates for the batches.
This displays an additional field Use
Expiry Dates in the Stock Item
Creation screen.
Use different Actual & Billed
Quantity
Set this option to Yes, if you want
to specify quantities, that are
different from those delivered/
received, when invoicing.
Order Processing
Allow Purchase Order
Processing
Set this option to Yes, to create
Purchase Orders. This feature can
also be used for pre-closure of
purchase order.
Allow Sales Order Processing
Set this option to Yes, to create
Sales Orders. This feature can also
be used for pre-order closure of
sales order.
Allow Job Order Processing
Set this option to Yes, to create
Job Work Out/In Orders.
Invoicing
Allow Invoicing
This field performs the same
function as explained in
Accounting Features.
Enter Purchases in Invoice
Format
This field performs the same
function as explained in
Accounting Features
Use Debit/Credit Notes
This field performs the same
function as explained in
Accounting Features.
Use Invoice Mode for
Credit Notes
This field performs the same
function as explained in
Accounting Features.
Use Invoice Mode for Debit
Notes
This field performs the same
function as explained in
Accounting Features
Separate Discount Column
on Invoices
This option is active only if
Allow invoicing is set to Yes.
Set this option to Yes, if you
want a separate column for
discounts in invoices.
Purchase Management
Track Additional Costs of
Purchase
Set this option to Yes, to
obtain a break-up of
purchase costs, without the
need to separately debit
ledger accounts for
expenses.
Sales Management
Use Multiple Price Levels
Set this option to Yes to create
Multiple Price Levels. Refer
Enable and Create Price Lists for
more details.
Additional Inventory Vouchers
Additional Inventory
Vouchers
Use Tracking Numbers
(Delivery/Receipt Notes)
Set this option to Yes, if you
want to use tracking numbers
to maintain the relation
between Delivery notes and
Invoices/Bills. This is available
for both Purchases and Sales.
Use Rejection
Inward/Outward Notes
Set this option to Yes, if you
wish to record rejection of
goods separately and not
through a common Debit
Note or Credit Note.
Use Material In/Out
Set this option to Yes, to
record transfer of item
quantity towards the party
and transfer material from
one Godown (Location) to
the other.
Track Stock Item Cost
Set this option to Yes, to
analyse the cost involved for
an item.
Enable Excise
Enable Value Added
Tax
Enable Service Tax
Enable Tax Deducted
at Source
Enable Tax Collected
at Source
Enable Payroll
Statutory
To Enable Excise in
Tally.ERP 9,
Go to Gateway of Tally >
F11: Features > Statutory
& Taxation
Set the options Enable
Dealer - Excise and Set/
Alter Excise Details to Yes
To enable VAT in
Tally.ERP 9,
Go to Gateway of Tally >
F11: Features> F3:
Statutory & Taxation
In the Statutory &
Taxation Features,
Set Enable Value Added
Tax (VAT) to Yes
Enable Set/Alter VAT
Details
To enable Service
tax in Tally.ERP 9,
Go to Gateway of
Tally > F11:
Features> F3:
Statutory &
Taxation
In the Statutory &
Taxation Features,
Service tax Yes
To enable Service
tax in Tally.ERP 9,
Go to Gateway of
Tally > F11:
Features> F3:
Statutory &
Taxation
In the Statutory &
Taxation
Features,
Tax Deducted At
Source
To enable Service
tax in Tally.ERP 9,
Go to Gateway of
Tally > F11:
Features> F3:
Statutory &
Taxation
In the Statutory &
Taxation Features,
Tax collceted At
Source
To enable Service
tax in Tally.ERP 9,
Go to Gateway of
Tally > F11:
Features> F3:
Statutory &
Taxation
In the Statutory &
Taxation Features,
Enable Payroll
Creating a Single Ledger

By default, Tally.ERP 9 contains two Ledger accounts namely, Cash (Under Cash-in- Hand) and Profit and Loss
Account (direct Primary Account). You need to create all other accounts heads. There are no restrictions in Ledger
creation except that you cannot create another Profit & Loss A/c. Any number of Cash Accounts may be created in
any other name for ex: Petty Cash.

Go to Gateway of Tally > Accounts Info > Ledgers > Create

Ledgers can be created in Normal mode or in Advance mode.

Creating Ledger in Normal Mode

The creation of a Ledger depends on the features you have selected under F11: Features of your company and F12:
Configure. You can create a single ledger account with the default options enabled.

Go to Gateway of Tally > Accounts Info > Ledgers > Single Ledger > Create
Name

Enter the Name of the account. You can provide the full name of the account. Tally.ERP 9 fits it all in. Press Enter
to move to the next field. Tally.ERP 9 does not allow the entry of duplicate names. The uniqueness check is made
here itself.

Note that the punctuation and other non-relevant information are ignored by Tally.ERP 9 in its recognition of a
name. Thus, CST, C.S.T. and C. S. T. are all considered as same.

Tally.ERP 9 converts the first letter of all relevant words to upper case, which helps you; speed up data entry.

Alias

Enter an alias name if required. You can access the Ledgers using the original name or the alias name.
Under

All accounts must be classified under their appropriate Groups. Select the Group under which the Ledger is
created from the List of Groups. (To create a new Group from this field press [ALT + C]). A wrong classification
would affect the treatment of the Ledger account in final statements and during voucher entry.

You can, alter a Ledger account to change its group classification at any time. Refer Importance of Grouping and
Accounting Classifications: for more details in Grouping

Opening Balance

If yours is an existing company whose books you are entering into Tally.ERP 9, Opening Balance would be
applicable in circumstances where the Ledger is an asset or a liability and if it has a balance in the account as on
the date of beginning of books in Tally.ERP 9.

Tally.ERP 9 recognizes normal accounting principles of debit balances for Assets and credit balances for
Liabilities. It accepts the reverse for obverse balances. Revenue accounts normally do not have balances.
Tally.ERP 9, however, permits you to give balances even for such accounts - You may be transferring your books
on to Tally.ERP 9 in the middle of the year and may not have closed them in your earlier system. Hence, you may
specify whether the balance is Debit or Credit. Simply D orC would suffice.

Creating a Multi Ledger

Go to Gateway of Tally > Accounts Info > Ledgers > Multi Ledgers> Create
Go to Gateway of Tally > Accounts Info > Ledgers > Ledgers> Display

Go to Gateway of Tally > Accounts Info > Ledgers > Ledgers> Alter

Change and save

For Delete Press Alt+D !!
Balance Sheet Opening Balance:

Creating a Single Ledger

Go to Gateway of Tally > Accounts Info > Ledgers > Create

Ledgers can be created in Normal mode or in Advance mode.

Creating Ledger in Normal Mode

The creation of a Ledger depends on the features you have selected under F11: Features of your company and F12:
Configure. You can create a single ledger account with the default options enabled.

Go to Gateway of Tally > Accounts Info > Ledgers > Single Ledger > Create
Name

Note that the punctuation and other non-relevant information are ignored by Tally.ERP 9 in its recognition of a
name. Thus, CST, C.S.T. and C. S. T. are all considered as same.

Tally.ERP 9 converts the first letter of all relevant words to upper case, which helps you; speed up data entry.

Alias

Enter an alias name if required. You can access the Ledgers using the original name or the alias name.
Under

You can, alter a Ledger account to change its group classification at any time. Refer Importance of Grouping and
Accounting Classifications: for more details in Grouping

Opening Balance
If yours is an existing company whose books you are entering into Tally.ERP 9, Opening Balance would be
applicable in circumstances where the Ledger is an asset or a liability and if it has a balance in the account as on
the date of beginning of books in Tally.ERP 9.

Create all Ledger same as Capital and submit opening Balance.

Detailed Setup Guide:

1. Execute Tally.ERP 9 and select the required Company.
2. Go to > Gateway of Tally > Balance Sheet

1) In Balance Sheet Report click Alt+F1 to see the normal Balance Sheet in
detail:

Press Alt+S for Schedule VI.

Voucher Entry in Tally.ERP 9

Lesson Objectives
On completion of this lesson, you will be able to

Describe the purpose of the Tally.ERP 9 Accounting Vouchers

Create and alter Accounting Vouchers
Use vouchers to enter Accounting transactions
Describe the use of Non-Accounting Vouchers
Describe the purpose of the Tally.ERP 9 Inventory vouchers
Create and alter Inventory Vouchers
Using vouchers to enter Inventory transactions

In accounting terms, a voucher is a document containing the details of a financial transaction. For
example, a purchase invoice, a sales receipt, a petty cash docket, a bank interest statement, and so
on. For every such transaction made, a voucher is used to enter the details into the ledgers to update
the financial position of the company. This feature of Tally.ERP 9 will be used most often.
Tally.ERP 9 follows the Golden Rule of Accounting :

Real Accounts Personal Accounts Nominal Accounts

Debit What Comes in The Receiver Expenses and Losses
Credit What Goes out The Giver Incomes and Gains

5.1 Accounting Vouchers

Tally.ERP 9 is pre-programmed with a variety of accounting vouchers, each designed to perform
a different job. The standard Accounting Vouchers are:
Contra Voucher (F4)
Payment Voucher (F5)
Voucher Entry in Tally.ERP 9

Receipt Voucher (F6)

Journal Voucher (F7)
Sales Voucher /Invoice (F8)
Credit Note Voucher (CTRL+ F8)
Purchase Voucher (F9)

Optional Voucher: All the available vouchers in Tally.ERP 9 (except

non-accounting vouchers) can be marked optional, if required.
Post-dated voucher: All the available vouchers in Tally.ERP 9 can be
marked post-dated, if required.

You can alter these vouchers to suit your company, and also create new ones. Read ahead to
understand the function of each voucher type. The following exercises are sample enteries for
understanding Voucher entry in Tally.ERP 9, do not make these entries.

5.1.1 Contra Voucher (F4)

For example: withdrawing money from the bank for petty cash.
Contra Voucher
Description Records funds transfer between cash and
bank accounts
Voucher Entry Account Amount Amount
State Bank of India Credit
(Bank Accounts)
Petty Cash Debit
(Cash-in-hand)
Use a Contra Voucher to record the entry.
Setup :
In Voucher entry mode, press F12: Contra Configuration and set the following to
Yes: Skip the Date field in Create Mode (faster entry!)
Use Cr/Dr instead of To/By during
entry Warn on Negative Cash Balance
Show Ledger Current Balances
Show Balances as on Voucher Date

84
Voucher Entry in Tally.ERP 9

Go to the Gateway of Tally > Accounting Vouchers > F4: Contra.

Figure 5.1 Contra Voucher

Press Y or Enter to accept the screen.

5.1.2 Payment Voucher (F5)

For example, a company settles a creditor's bill by cheque.

Payment Voucher
Description Records all bank and cash payments
Voucher Entry Account Amount Amount
Ledger account paid Debit
Kaltronic Ltd.
(Sundry Creditors)
Bank or cash account Credit
State Bank of India
(Bank Account)
Voucher Entry in Tally.ERP 9

Use a Payment Voucher to record the entry.

Go to the Gateway of Tally > Accounting Vouchers > F5: Payment.

Figure 5.2 Payment Voucher

Press Y or Enter to accept the screen.

Payment in Single Entry Mode

In Voucher entry mode, use F12: Payment Configuration and set Use Single Entry mode
for Pymt/Rcpt/Contra to Yes.
Payment Voucher
Description Records all bank and cash payments
Voucher Entry Account Amount Amount
Ledger account paid Debit
Conveyance
Postage
(Indirect Expenses)
Bank or cash account Credit
Petty Cash
(Bank Account)
Voucher Entry in Tally.ERP 9

The entry made in the single entry mode appears as shown below:

Figure 5.3 Payment Voucher with Single Entry Mode

Press Y or Enter to accept the screen.

The advantage of a single entry mode is that you can select multiple debits or credits depending
on the type of entry. Similarly the transactions can be recorded in single entry mode even in
Receipt and Contra vouchers.

Warn on Negative Cash Balance

Tally.ERP 9 displays a warning if the cash balance is NIL when Warn on Negative Cash Balance is
set to Yes in the F12: Payment Configuration. For example, a cash ledger account has no balance.
A payment of Rs. 4,500 towards Telephone expenses is to be made. In the process of making the
payment, Tally.ERP 9 displays a warning at the time of accepting the entry.

The entry made appears as shown below:

Voucher Entry in Tally.ERP 9

Figure 5.4 Payment Voucher with Warning on Negative Cash

In addition to the warning, Tally.ERP 9 also displays the negative balance amount in Red.

5.1.3 Receipt Voucher (F6)

For example, the company receives a bank advice that the interest has been credited to its
deposit account.

Receipt Voucher
Description Records all receipts into bank or cash accounts
Voucher Entry Account Amount Amount
Ledger account receiving Bank Credit
Interest
(Indirect Incomes)
Bank or cash account Debit
Deposit Account
Voucher Entry in Tally.ERP 9

Use a Receipt Voucher to record the entry.

Ensure in F12: Payment Configuration, Use Single Entry mode for Pymt/Rcpt/Contra is set
to No.
Go to the Gateway of Tally > Accounting Vouchers > F6:
Receipt. The entry made appears as shown below:

Figure 5.5 Receipt Voucher

Press Y or Enter to accept the screen.

5.1.4 Journal Voucher (F7)

For example, the company has entered some expenditure on advertising as general office costs,
rather than recording the transaction in the separate ledger for advertising.
Journal Voucher
Description Records adjustments between ledger accounts
Voucher Entry Account Amount Amount
Advertising Debit
(Indirect Expenses)
Office Costs Credit
(Indirect Expenses)
Voucher Entry in Tally.ERP 9

Use the Journal Voucher to adjust the two accounts.

Go to the Gateway of Tally > Accounting Vouchers > F7:
Journal. The entry made appears as shown below:

Figure 5.6 Journal Voucher

Press Y or Enter to accept the screen.

5.1.5 Sales Voucher (F8)
For example, a company sells software on credit.
Sales Voucher
Description Records all sales
Voucher Entry Account Amount Amount
Buyer’s ledger account
Milton & Co. Debit
(Sundry Debtors)
Sales Accounts
(Local Sales) Credit
voucher Entry in Tally.ERP 9

Use a Sales Voucher for making this entry.

Go to the Gateway of Tally > Accounting Vouchers > F8: Sales.
The entry made appears as shown below:

Figure 5.7 Sales Voucher

Press Y or Enter to accept the screen.

5.1.6 Credit Note Voucher (Ctrl + F8)
This voucher type is made available when the option Use Debit/Credit Note to is set to Yes in the
F11: Features (F1: Accounting features).
For example: A customer returns stock that was incorrectly supplied.
Credit Note Voucher
Description Records credit note entry for sales returns or Customer over-
charging
Voucher entry Account Amount Amount
Buyer’s ledger account
Milton & Co Credit
(Sundry Debtors)
Sales Accounts
Local Sales Debit
Voucher Entry in Tally.ERP 9

Use a Credit note to record this entry.

Go to the Gateway of Tally > Accounting Vouchers > F8: Credit
Note. The entry made appears as shown below:

Figure 5.8 Credit Note Voucher

Press Y or Enter to accept the screen.

5.1.7 Purchase Voucher (F9)

A company buys computer parts on credit.
Purchase Voucher
Description Records all purchases
Voucher Entry Account Amount Amount
Supplier’s ledger account
Beltron Ltd Credit
(Sundry Creditor)
Purchase Accounts
(Local Purchases) Debit
Voucher Entry in Tally.ERP 9

Use a Purchase Voucher to record this entry.

Go to the Gateway of Tally > Accounting Vouchers > F9: Purchase.
The entry made appears as shown below:

Figure 5.9 Purchase Voucher

Press Y or Enter to accept the screen.

5.1.8 Debit Note Voucher (Ctrl + F9)

This voucher type is made available when the option Use Debit/Credit Notes is set to Yes in the
F11: Features (F1: Accounting Features).

For example, a company returns damaged goods to a supplier.

Debit Note Voucher

Description Records debit note entry for purchase returns or over-charging
by a supplier
Voucher Entry in Tally.ERP 9

Voucher Entry Account Amount Amount

Supplier’s ledger account
Beltron Ltd (Sundry Creditor)
Debit
Purchase Accounts
(Local Purchases) Credit

Use a Debit Note to record this entry.

Go to the Gateway of Tally > Accounting Vouchers > F9: Debit Note.
The entry made appears as shown below:

Figure 5.10 Debit Note Voucher

Press Y or Enter to accept the screen.

5.1.9 Reversing Journal Voucher (F10)
Reversing Journals are special journals that are automatically reversed after the date of the
journal. They exist only for a day and are effective on the date of the reversing journal. This
voucher type is available only if the feature Use Reversing Journals & Optional Vouchers is
set to Yes in the F11: Features (F1: Accounting Features).
Voucher Entry in Tally.ERP 9

The entry made for this, is as follows:

Reversing Journal Voucher
Description Records the voucher entries in a Reversing Journal Register,
without affecting the ledger accounts and financial statements
Voucher entry Account Amount Amount
Ledger account Debit
Ledger account Credit
Go to the Gateway of Tally > Accounting Vouchers > F10: Reversing Journal.

Reversing Journals are useful in Scenario Management.

5.1.10 Memo Voucher (Ctrl + F10)

Memo Voucher is a non- accounting voucher and the entries made using it will not affect your
accounts. In other words, Tally.ERP 9 does not post these entries to ledgers but stores them in a
separate Memo Register. You can alter and convert a Memo voucher into a regular voucher
when you decide to bring the entry into your books.

Memo vouchers are used for the following purposes :

1. Making suspense payments
For example, the company gives an employee cash to buy office supplies, the exact nature and
cost of which are unknown. You could have entered a voucher stating petty cash advance, a
voucher to record the actual expenditure details when they are known, and another voucher to
record the return of surplus cash. However, a simpler way is to enter a Memo voucher when the
cash is advanced, and then turn it into a Payment voucher for the actual amount spent, when
known.

2. Vouchers not verified at the time of entry

Sometimes it so happens that you do not understand the details of a voucher you are entering.
In such cases, enter it as a Memo voucher and amend it when you get the details.

3. Items given on approval

Usually, entries are made into the books only after a sales transaction is completed. Items given
on approval, can be tracked by using a Memo voucher. It can either be converted into a proper
Sales voucher or be deleted depending on the outcome.
Voucher Entry in Tally.ERP 9

Memo Voucher
Description Records the voucher entries in a memo register, without
affecting the ledger accounts and financial statements
Voucher Entry Account Amount Amount
Ledger account Debit
Ledger account Credit

5.1.11 Optional Voucher

This is another non-accounting voucher which is available only if the feature Use Reversing
Journals & Optional Vouchers is set to Yes in the F11: Features (F1: Accounting Features).
It differs from the Memo voucher in two respects:
It is not a voucher type, since all the other voucher types can be marked as Optional
during a voucher entry.
You have the option to bring this voucher into your accounts temporarily and see its
effect on financial reports. Any voucher type (except non-accounting voucher) can be
designated as an Optional voucher.

Optional Voucher
Description Records voucher entries temporarily, to help visualise the effect
on reports, without affecting the ledgers
Voucher Entry Account Amount Amount
Ledger account Debit
Ledger account Credit

5.1.12 Post-dated Vouchers

Post-dated Vouchers are ignored by Tally.ERP 9 until the date in question. This is useful for entering
transactions that take place on a regular basis. For example, if you pay for something by instalments,
you can set-up the payments in advance, and Tally.ERP 9 will only enter them in the ledgers as and
when they fall due. A voucher is marked as Post-dated while creating or altering it.

5.1.13 Creating a New Voucher Type

National Traders wants to record bank and petty cash payments differently and needs two new
voucher types to replace the pre-defined Payment voucher. Inorder to do this:
Create a Bank Payment voucher
Voucher Entry in Tally.ERP 9

Go to the Gateway of Tally > Accounts Info. > Voucher Types > Create.
1. Name: Bank Payment
2. Type of Voucher: Payment (Specify the default Tally.ERP 9 voucher, whose functions the
new voucher should copy).
3. Abbr.: Bank Pymt (Specify the abbreviation to denote this new voucher in reports)
4. Method of Voucher Numbering: Automatic
You can choose one of the following methods for numbering from the pop-up:

Method of Numbering Purpose

Automatic For Tally.ERP 9 to do it for you.
Manual You do it. You can also specify if you wish to prevent
duplicates.
None To disable numbering for this voucher type.

5. Use Advance Configuration: No

6. Use EFFECTIVE Dates for Vouchers: No
7. Make ‘Optional’ as default: No (This is to set the voucher type as an Optional voucher, by
default)
8. Use Common Narration: Yes
9. Narrations for each entry: No
10. Print after saving Voucher: No
11. Name of Class: Skip.

The voucher date is taken from the current date mentioned at the
Gateway of Tally.ERP 9. However, the effective date for the voucher
may be different. For example, entering a post-dated cheque.
Tally.ERP 9 displays the narration field which applies to the whole
voucher. By setting Use Common Narration option to No, we can
have separate narration fields for each line on the voucher. Reversing
Journals are used for Scenario Management.
The Name of Class field enables creation of Voucher Classes for the
respective voucher types. (The Voucher class is a template to custom-
ise voucher data entry).

A Bank Payment Voucher Type Creation screen appears as shown below:

Voucher Entry in Tally.ERP 9

Figure 5.11 Voucher Type Creation Screen — Bank Payment

12. Press Y or Enter to accept the screen.

5.1.14 Displaying and Altering a Voucher Type

Observe the menu, you will notice that you can also display and alter voucher types. Selecting
these options brings up a List of Voucher Types, from which you can select the one you want
to view or work on. Apart from the heading, the Voucher Type Display/Alter screens are
identical to the Creation screen.

Practice Exercise
Create a Petty Cash Payment Voucher Type
Ensure that the details in the Voucher Type Creation screen are as shown below:
Voucher Entry in Tally.ERP 9

Figure 5.12 Voucher Type Creation — Petty Cash

Press Y or Enter to accept the screen.

The above exercises are sample enteries for understanding Voucher entry
in Tally.ERP 9, do not make these entries.

5.1.15 Recording Accounting Transactions

Let us record the following business transactions of National Traders for the month of April 2009 :

National Traders Business Transactions

Date Transaction Details
1-4-09 Paid Rs 500 to Challenger Systems by cheque
1-4-09 Bought office supplies for Rs 150 with Petty Cash
2-4-09 Wages of Rs 600 paid to employees by cheque
5-4-09 Banked a cheque for Rs 5000 received from Data Link Technologies
6-4-09 Sold 1 IBM Pentium IV to Spectrum Computers for Rs 24,785.
6-4-09 Withdrew Rs 200 from Bank Account for Petty Cash
7-4-09 Bought 1 Laserjet 1500 from Silver Plus computers on credit for Rs 8,100
Voucher Entry in Tally.ERP 9

The basic steps to be followed while entering each voucher are:

Check if the date is correct and use F2: Date to change it if necessary.
Select the voucher type from the button bar and make a further selection from the supple-
mentary list that Tally.ERP 9 displays, if necessary.
Enter the appropriate reference for the Purchase and Sales
vouchers. Select the ledgers and enter the amounts.
Type the narration and check whether all the data is correct before accepting.

Create the following Accounting Vouchers in the books of National Traders :

Date Voucher Type Ledgers to be Selected Debit Credit

1-4-09 F5:Payment Dr - Challenger Systems 500.00
Bank Payment Cr - Bank Account 500.00
1-4-09 F5: Payment Dr - Office Costs 150.00
Cr - Petty Cash
Petty Cash 150.00
2-4-09 F5: Payment Dr - Wages 600.00
Cr - Bank Account
Bank Payment 600.00
5-4-09 F6: Receipt Cr - Data Link Technologies 5000.00
Dr - Bank Account 5000.00
6-4-09 F8: Sales Dr - Spectrum Computers 24,785.00
Cr - Computer Sales
24,785.00
6-4-09 F4: Contra Cr - Bank Account 200.00
Dr - Petty Cash
200.00
7-4-09 F9:Purchase Cr - Silverplus Computers 8,100.00
Dr - Printer Purchases
8,100.00

In the Purchase/Sales Ledger Masters, set Inventory Values are

affected to No and proceed with the above transactions. Enable the option
to Yes in the Inventory Transactions section.
Voucher Entry in Tally.ERP 9

A Voucher Entry screen comprises of the following :

Type of voucher
It is essential to check if you are using the right voucher for the transaction.
You can change the voucher type by selecting a new type from the button
bar, if required. For example on the selection of a payment voucher,
Tally.ERP 9 automatically displays the List of Voucher types you have
cre-ated. You can select the voucher type required.
Voucher number
Tally.ERP 9 automatically sets the voucher number for you. You can
change the voucher number manually, if required.
Reference
You can enter a reference of your choice. A Purchase order number or an
Invoice Number can be entered as a reference.
Date of voucher
The date of the voucher you enter is displayed at the top -right of the
Voucher Creation screen. The date is taken initially from the Gateway of
Tally - Current Date and you may need to change it frequently to ensure
that the vouchers are dated as you want.
Effective date
A voucher type can be configured to allow for an Effective date. The line
below the Date of voucher displays the date when the voucher will be
effective.
Particulars
This is where you enter the ledger names and the debit and credit
amounts. Each line displays a prompt of Dr or By for debit entries and Cr
or To for credit entries.
Depending on the voucher type, Tally.ERP 9 selects either ‘Dr’ or ‘Cr’ for
the first prompt, which you cannot change. Thereafter, you can change the
prompt (if necessary) by typing over it with a D or a C. To select a ledger,
type the first letter of its name. Tally.ERP 9 then displays a List of Ledger
Accounts beginning with the letter highlighted. Only ledgers suitable for
the voucher type are displayed. As you continue typing, the highlights
reduce until a match is found.The current balance is displayed when you
select the ledger, (if this option has been configured). The revised current
balance is shown after the amount is entered. On selecting the next ledger,
Tally.ERP 9 suggests the balancing amount as the value to be entered,
which may be accepted or typed over. The voucher entry cannot be
completed until the debits equal the credits.
Voucher Entry in Tally.ERP 9

Narration
Here you type whatever appropriately describes the transaction. Remem-
ber, you can have a separate narration for each line of particulars, if you
configure the voucher type in that way.
For Payment Vouchers, where a bank account has been credited,
Tally.ERP 9 pre-sets the narration to Ch.No. expecting a cheque number
to be entered. This can be over written if required.
Once the narration is complete, press Enter to bring up the Accept?
box.
Once you accept the data, Tally.ERP 9 presents another data entry
screen.

5.1.16 Trial Balance for April 2009

Go to the Gateway of Tally > Display > Trial Balance.
After making the above emtries, the Trial Balance of National Traders will appear as shown :

Figure 5.13 Trial Balance From April 1, 2009 to April 7, 2009

Voucher Entry in Tally.ERP 9

Enter further transactions for National Traders.

Business Transactions for the months of May and June 2009 are as follows:

National Traders Business Transactions

Date Transaction Details
10-5-09 Bank Advice received for bank interest of Rs.500 credited to the deposit account.
11-5-09 Electricity bill (Office costs) for Rs.400 received from Horizon Enterprises.
(Note: Use a Journal Voucher)
13-5-09 Sold 1 HP Laserjet 1010 Series for Rs 9,500 to a cash customer, retaining the
money as Petty Cash.
19-5-09 Salaries of Rs 2,500. Amount paid through Bank Account.
24-5-09 Sold 1 HCL Pentium IV for Rs. 21,500 to Supreme Computers.
30-5-09 Purchased 5 USB Pen Drives 64MB @ Rs. 1,250 each from Challenger Systems
on credit.
01-6-09 Paid freight charges of Rs 200 from petty Cash
01-6-09 Paid Challenger Systems Rs. 11,500 by cheque
09-6-09 Transferred Rs 6,000 from Bank Account to Deposit Account.
15-6-09 Cheque for Rs 15,000 received from Spectrum Computers
22-6-09 Purchased 4 IBM Pentium IVs for Rs. 17,100 each from a new supplier and paid
by cheque
22-6-09 Sold 2 IBM Pentium IVs for Rs. 24,785 to a customer who paid by cheque

In the Purchase/Sales Ledger Masters, set Inventory Values are

affected to No and proceed with the above transactions. Enable the option
to Yes in the Inventory Transactions section.
Voucher Entry in Tally.ERP 9

5.1.17 Trial Balance for June 2009

Go to the Gateway of Tally > Display > Trial Balance

Figure 5.14 Trial Balance From April 1, 2009 to June 30, 2009
 Open Tally program.
 Select your Company. In our case, we shall select M/s XYZ Limited.
 Maintain Assignment entry in tally voucher.
 Select ‘Display’ under gateway of tally.
 Select ‘Profit & Loss Account’. After you select ‘Profit & Loss Account’ then the screen shall
appear as under:-

Note: In above Profit and Loss Account, Trading Account and Profit & Loss Account are not
shown separately. To see gross profit and net profit separately, you have to do following
job:-

 You can see an icon on gateway of tally i.e. ‘Configuration’. Select the same or pres F-12.
After you select ‘configuration’, you will see the following screen:-
Now, Select the commands as follow:-

Show Vertical Profit & Loss Account If you want to see P&L in vertical form
then write ‘yes’. In our case we want to
see only in horizontal form. So you
select ‘No’. You can see the profit and
loss account in vertical form also after
selecting ‘Yes’ under this column.

Show Percentage Select ’No’.

Show with Gross Profit Select ‘Yes’ because we want to see

trading account separately.

Appearance of Name Select ‘Names only’

Scale Factor for Values Select ‘Default’

 Now your screen shall appear as under:-

 After you press enter on last command then format of your profit and loss account will
change in to parts i.e. it will show trading account and profit & loss account in two parts.
Now, you can see gross profit and net profit separately. This screen will appear as under:-
 If you see the Profit & Loss Account in above format, you will find that all the ledger
accounts are shown in groups. For example – direct expenses, indirect expenses etc. Now’
you want to see the profit and loss account in more detailed manner then you just select
‘Detailed’ on screen. Now, your screen shall appear as under:-
 Above format is much clearer than previous one.
 You can see the profit and loss account relating to any period. For this, just Select ‘Period’
Display Trial Balance in Tally.ERP 9
A Trial Balance is a summary of all ledger balances to check whether the figures are correct and balanced.
Considering that the journal entries are error-free and posted correctly to the general ledger, the total of all
debit balances should equal the total of all the credit balances.

In Tally.ERP 9, the matching of the Trial Balance is a foregone conclusion since all voucher entries are in
Debit - Credit format and must balance at the entry point.

To view the Trial Balance

Go to Gateway of Tally > Display >Trial Balance

Note: As pe r accounti ng pri nci ple s, the Tri al Balance doe s not l i st Cl osing Stock.

Tally.ERP 9 shows group wise Trial Balance. Next level detail for a group can be exploded by
pressing Shift+Enter. Details of all groups can also be obtained through configuration, except for groups
behaving like sub-ledgers.

Select F1: Detailed to break down the grouped information or simply drill down a Group for further detail.

The screen is displayed as shown.

Select F5: Led-wise to list all ledgers and their closing balances. The screen is displayed as shown.
Select New Column to bring up the closing balances for another date. The screen is displayed as shown.

Display Trial Balance in Tally.ERP 9

A Trial Balance is a summary of all ledger balances to check whether the figures are correct and balanced.
Considering that the journal entries are error-free and posted correctly to the general ledger, the total of all
debit balances should equal the total of all the credit balances.

In Tally.ERP 9, the matching of the Trial Balance is a foregone conclusion since all voucher entries are in
Debit - Credit format and must balance at the entry point.

To view the Trial Balance

Go to Gateway of Tally > Display >Trial Balance

Note: As pe r accounti ng pri nci ple s, the Tri al Balance doe s not l i st Cl osing Stock.

Select F1: Detailed to break down the grouped information or simply drill down a Group for further detail.

The screen is displayed as shown.

By default, Tally.ERP 9 contains two Ledger accounts namely, Cash (Under Cash-in- Hand) and
Profit and Loss Account (direct Primary Account). You need to create all other accounts heads.
There are no restrictions in Ledger creation except that you cannot create another Profit & Loss A/c.
Any number of Cash Accounts may be created in any other name for ex: Petty Cash.

Go to Gateway of Tally > Accounts Info > Ledgers > Create

Ledgers can be created in Normal mode or in Advance mode.

Creating Ledger in Normal Mode

The creation of a Ledger depends on the features you have selected under F11: Features of your
company and F12: Configure. You can create a single ledger account with the default options enabled.

Go to Gateway of Tally > Accounts Info > Ledgers > Single Ledger > Create
Name

Enter the Name of the account. You can provide the full name of the account. Tally.ERP 9 fits it all
in. Press Enter to move to the next field. Tally.ERP 9 does not allow the entry of duplicate names.
The uniqueness check is made here itself.

Note that the punctuation and other non-relevant information are ignored by Tally.ERP 9 in its
recognition of a name. Thus, CST, C.S.T. and C. S. T. are all considered as same.

Tally.ERP 9 converts the first letter of all relevant words to upper case, which helps you; speed up
data entry.

Alias

Enter an alias name if required. You can access the Ledgers using the original name or the alias
name.
Under

All accounts must be classified under their appropriate Groups. Select the Group under which the
Ledger is created from the List of Groups. (To create a new Group from this field press [ALT + C]).
A wrong classification would affect the treatment of the Ledger account in final statements and
during voucher entry.

You can, alter a Ledger account to change its group classification at any time. Refer Importance of
Grouping and Accounting Classifications: for more details in Grouping

Opening Balance

If yours is an existing company whose books you are entering into Tally.ERP 9, Opening Balance
would be applicable in circumstances where the Ledger is an asset or a liability and if it has a
balance in the account as on the date of beginning of books in Tally.ERP 9.

Tally.ERP 9 recognizes normal accounting principles of debit balances for Assets and credit balances
for Liabilities. It accepts the reverse for obverse balances. Revenue accounts normally do not have
balances. Tally.ERP 9, however, permits you to give balances even for such accounts - You may be
transferring your books on to Tally.ERP 9 in the middle of the year and may not have closed them in
your earlier system. Hence, you may specify whether the balance is Debit or Credit.
Simply D orC would suffice.
Creating a Purchase Invoice

To create purchase invoice for purchase of taxable goods,

Go to Gateway of Tally > Accounting Vouchers > F9: Purchases

1. Select the Party’s A/c Name from the List of Ledger Accounts.

2. Select the Purchase Ledger grouped under Purchase Accounts with VAT/Tax class -
Purchase From URDs - Taxable Goods (Composition).

3. The VAT/Tax class appears as Purchase From URDs - Taxable Goods

(Composition).

4. Select the stock items from the List of Items.

5. Enter the Quantity and Rate. The amount is automatically displayed in the Amount
field.

6. Set the option - Is e-Sugam Applicable to Yes/No as per requirement.

7. Accept the Purchase invoice.

Creating a Sales Invoice

To create sales invoice for sale of taxable goods,

Go to Gateway of Tally > Accounting Vouchers > F8: Sales

1. Select the Party’s A/c Name from the List of Ledger Accounts.

2. Select Sales Ledger grouped under Sales Accounts with VAT/Tax class - Sales -
Composition Tax @ 1%.

3. The VAT/Tax class appears as Sales - Composition Tax @ 1%.

4. Select the stock items from the List of Items

5. Enter the Quantity and Rate. The amount is automatically displayed in the Amount
field.

6. Set Is e-Sugam Applicable to Yes/No as per requirement.

7. Accept the Sales invoice.

reating a Debit Note

To create a Debit Note for Purchase Returns,

Go to Gateway of Tally > Accounting Vouchers > Ctrl+F9: Debit Note

1. Enter the reference number in the Ref. field.

2. Select the Party’s A/c Name from the List of Ledger Accounts.

3. Select the Purchase Ledger and the appropriate VAT /Tax Class appears.

4. Select the stock item from the List of Items and enter the Quantity and Rate. The
amount is automatically displayed in the Amount field.

5. Set Is e-Sugam Applicable to Yes/No as per requirement.

6. Accept the Debit Note.

Creating a Credit Note

To create a Credit Note for Sales Returns,

Go to Gateway of Tally > Accounting Vouchers > Ctrl+F8: Credit Note

1. Enter the reference number in the Ref. field.

2. Select the Party’s A/c Name from the List of Ledger Accounts.

3. Select the Sales Ledger and the appropriate VAT /Tax Class appears.

4. Select the stock item from the List of Items and enter the Quantity and Rate. The
amount is automatically displayed in the Amount field.

5. Set Is e-Sugam Applicable to Yes/No as applicable.

6. Accept the credit note.

Creating a Payment Entry with Narration for each Entry

If you want the narration details for every ledger you debit or credit (Single narration), you can
configure Tally.ERP's Narration details accordingly.

To activate the option Narration for each entry,

Go to Gateway of Tally > Accounts Information > Voucher Types > Alter

1. Select the required Voucher Type.

2. Enable the option Narrations for each Entry and accept the details.

3. Return to Accounting Vouchers in Gateway of Tally and select the voucher type and
pass the entry.

Narration for each entry option is available for all Accounting Voucher Types. Given below is an
example of a Payment transaction with narrations for each entry enabled:
The above entry consists of both common narration and narrations for each entry. In case of
multiple debit/credit entries, you can give single line narration separately for every ledger account
selected.

Special Keys for Voucher Narration Field

• ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective
of the voucher type.

• CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of
the ledger.
Creating a Journal Entry

Journal entries are usually used for finalization of accounts.

To pass a Journal Voucher,

Go to Gateway of Tally > Accounting Vouchers

• Click on F7: Journal on the Button Bar or press F7.

For example, there may be entries made for interest accrued or interest due. If you have to receive
Interest from a party, the same can be entered using Journal Voucher.

1. Debit the Party

2. Credit the Interest Receivable Account

The Journal entry is displayed as shown:

Special Keys for Voucher Narration Field:

• ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective
of the voucher type.

• CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of
the ledger.
Allowing Cash Accounts in Journals

Journals are adjustment entries, which do not involve Cash account and Bank account. However in
exceptional cases where the user would like to account Journal entries involving Cash/Bank
Account, Tally.ERP 9 has the flexibility of passing such entries by enabling the option under F12
configuration.

To enable Cash Accounts in Journal voucher,

• Set Allow Cash Accounts in Journals to Yes in F12: Configure (Voucher Entry
Configuration).

To pass a Journal voucher with Cash/Bank Ledger,

1. Go to Gateway of Tally > Accounting Vouchers > Select F7: Journal

2. Press the spacebar at the Debit or Credit field.

The Journal Voucher Screen with Cash/Bank Ledger selection will appear as shown :
Not e: Al l C ash account s and Bank account s are displ aye d i n the List of Le dge r
Accounts. Accordingl y the j ournal e ntry has to be made .

Special Keys for Voucher Narration Field

• ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective
of the voucher type.

• CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of
the ledger.
Debit Note Entry

Debit Note is a document issued to a party stating that you are debiting their Account in your
Books of Accounts for the stated reason or vise versa. It is commonly used in case of Purchase
Returns, Escalation/De-escalation in price, any other expenses incurred by you on behalf of the
party etc.

Debit Note can be entered in voucher or Invoice mode.

You need to enable the feature in F11: Accounting or Inventory features.

• To use it in Voucher mode you need to enable the feature in F11 :Accounting Features
- Use Debit / Credit Notes.
• To make the entry in Invoice mode enable the option F11: Accounting Features - Use
invoice mode for Debit Notes.

To go to Debit Note Entry Screen,

Go to Gateway of Tally > Accounting Vouchers

• Click on Ctrl+F9: Debit Note on the Button Bar or press Ctrl+F9.

You can toggle between voucher and Invoice mode by clicking Ctrl+V.

Pass an entry for the goods purchased returned to Supplier A:

Special Keys for Voucher Narration Field:

• ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective
of the voucher type.

• CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of
the ledger.
Credit Note Entry

Credit Note is a document issued to a party stating that you are crediting their Account in your
Books of Accounts for the stated reason or vise versa. It is commonly used in case of Sales
Returns, Escalation/De-escalation in price etc.

A Credit Note can be entered in voucher or Invoice mode.

You need to enable the feature in F11: Accounting or Inventory features.

To go to Credit Note Entry Screen:

Go to Gateway of Tally > Accounting Vouchers

1. Click on Ctrl+F8: Credit Note on the Button Bar or press Ctrl+F8.

You can toggle between voucher and Invoice mode by clicking Ctrl+V.

Pass an entry for goods sold returned from Customer A:

Special Keys for Voucher Narration Field:

• ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective
of the voucher type.

• CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of
the ledger.
Creating Inventory Masters in
Tally.ERP 9

Lesson Objectives
On completion of this lesson, you will be able to understand

The basic functions of the Tally.ERP 9 Inventory System

Creating and maintaining Inventory Masters
Creating and maintaining stock details
Creating stock items and entering opening balances

Inventory accounting includes recording of stock details like the purchase of stock, the sale of stock,
stock movement between storage locations or godowns and providing information on stock
availability. Tally.ERP 9 makes it possible to integrate the inventory and accounting systems so that
the financial statements reflect the closing stock value from the Inventory system.
The inventory system operates in much the same way as the accounting system.
First you set up the inventory details, which is a similar operation to creating the chart of
accounts although, in this case, there are no pre-defined set of stock groups.
Second, you create the individual stock items, which is similar to setting up the ledgers.

In a newly created company the Inventory Info. menu comprises of four types of Masters, viz.
Stock Groups, Stock Items, Units of Measure and Voucher Types.
Go to the Gateway of Tally > Inventory Info.
The Inventory info. menu is displayed as shown:

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Creating Inventory Masters in Tally.ERP 9

Figure 4.1 Inventory Info. Menu

The above Inventory Masters types are explained in detailed in the following
sections. Units of Measure

Let us take the example of Indus Enterprises that sells Televisions and Music
Systems. Given below is the structure of items being sold.
Group A – Televisions
A1 – Sony A1a – Sony 29 inches TV
A1b – Sony 25 inches TV
A2 – Philips A2a – Philips 29 inches TV
A2b – Philips 25 inches TV
A3 – Videocon A3a – Videocon 29 inches TV
A3b – Videocon 25 inches TV

Group B – Music Systems

B1 – Sony B1a – Sony Tape-Recorder
B1b – Sony CD Player
B2 – Videocon B2a – Videocon Tape-Recorder
B2b – Videocon CD Player

The televisions are sold in numbers. Hence, the Unit of Measure will be Nos.

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Creating Inventory Masters in Tally.ERP 9

Indus Enterprises has two Godowns, the Bangalore Godown and the Mumbai
Godown. The grouping structure in Tally.ERP 9 is as follows:
Stock Group
1. Televisions (main stock group)
Sony TV – stock group under Televisons
Philips TV – stock group under Televisons
Videocon TV – stock group under Televisons
2. Music Systems (main stock group)
Sony Music Systems – Stock Group under Music Systems
Videocon Music Systems – Stock Group under Music Systems

Under the stock group Televisions, let us create stock groups based on the different brands
being sold viz. Sony, Philips and Videocon. This helps to find the total sales of a particular brand
of tele-visions at any given point of time. In order to compare the total sales of the 29 and 25
inches tele-visions respectively, Tally.ERP 9's feature of Stock Categories for parallel
classification can be used.
Experiment Creation of Inventory Masters in Indus Enterprises.

4.1 Stock Groups

Stock Groups are provided to help in the classification of stock items. Classification is done
based on some common behaviour. Grouping stock items makes it easy to identify and report
them in the statements. For example, items of a particular brand can be grouped together so that
you can get the inventory details of all the items of that brand.

4.1.1 Creating Stock Group

i. Create the Stock Group – Television under Primary.
Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create (under the Single
Stock Group).
Ensure that the screen appears as shown below:

Figure 4.2 Stock Group Creation — Television

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Creating Inventory Masters in Tally.ERP 9

Press Y or Enter to accept the screen.

Similarly, create Music Systems under Primary.

ii. Create Sony TV under Televisions.

The screen is displayed as shown below:

Figure 4.3 Stock Group Creation — Sony TV

Press Y or Enter to accept the screen.

Practice Exercise
Create the following Stock Groups in the similar manner
Name Under Can Quantities
of items be
ADDED
Philips TV Televisions Yes
Videocon TV Televisions Yes
Sony Music Systems Music Systems Yes
Videocon Music Systems Music Systems Yes

4.2 Stock Categories

This is a feature, which offers a parallel classification of stock items. Like Stock Groups, Stock
cat-egories are also classified based on some similar behaviour. The advantage of using
Tally.ERP 9 lies in categorising Stock items together, (based on functionality) across different
stock groups. This enables you to obtain reports for alternatives or substitutes of a stock item.

Set Yes to Maintain Stock Categories in F11: Features (F2: Inventory Features) to get
an additional option Stock Categories under Inventory Info.

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Creating Inventory Masters in Tally.ERP 9

4.2.1 Creating Stock Category

Go to the Gateway of Tally > Inventory Info. > Stock Categories >
Create. i. Create Stock Category 29 inches TV Under Primary

Figure 4.4 Stock Category Creation — 29 inches TV

Press Y or Enter to accept the screen.

Similarly , create Stock Category 25 inches TV under Primary.

4.3 Godowns / Locations

A place where stock items are stored is referred to as Godowns. You can specify where the
stock items are kept. For example: A warehouse, shelf or rack etc, and obtain stock reports for
each Godown and account for the movement of stock between locations/Godowns.

Set Yes to Maintain Multiple Godowns in F11: Features (F2: Inventory Features) to
get additional option like Stock Categories under Inventory Info.

4.3.1 Creating a Godown

Go to the Gateway of Tally > Inventory Info. > Godowns >
Create. i. Create a Godown – Bangalore under Primary.
Ensure that the screen is displayed as shown below:

Figure 4.5 Godown Creation — Bangalore

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Creating Inventory Masters in Tally.ERP 9

Press Y or Enter to accept the screen.

Godowns have a main location, by default because of which the

options Display and Alter are functional even before you create a
godown.

Similarly create the godown – Mumbai under Primary.

4.4 Units of Measure

Stock Items are mainly purchased and sold on the basis of quantity. The quantity inturn is
measured by units. In such cases, it is necessary to create the Unit of Measure. The Units of
Measure can either be simple or compound. Examples of simple units are: nos., metres, kilo-
grams, pieces etc. Examples for compound units are: a box of 10 pieces etc. Create the Units of
Measure before creating the Stock Items.

4.4.1 Creating Units of Measure

Go to the Gateway of Tally > Inventory Info. > Units of Measure >
Create. The Unit Creation Screen appears as shown below:

Figure 4.6 Units of Measure Creation screen

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Creating Inventory Masters in Tally.ERP 9

Formal Name
This represents the complete or formal name of a symbol used while creating a unit. Different
companies use different symbols to represent the same units. Formal names help you to match
the symbols with their respective units. For example, the symbol for numbers (formal name) can
be nos or num.
Number of Decimal Places
A unit can be expressed as fractions. For example, a 3.15 Kg refers to 3Kg and 150 grams. The
number of digits expressed in grams after the decimal places are three. Likewise, fractions up to
four decimal places can be expressed in the same manner. For expressing numbers, without a
decimal place, specify 0 in this option.

Let us create the unit Nos.

1. Type: Simple
2. Symbol: Nos
3. Formal Name: Numbers
4. Number of Decimal Places: 0

The Unit Creation screen is displayed as shown below:

Figure 4.7 Units of Measure Creation — Nos

5. Press Y or Enter to accept the screen.

4.5 Stock Items

Stock items are goods that you manufacture or trade (sell and purchase). It is the primary
inventory entity. Stock Items in the Inventory transactions are similar to ledgers being used in
accounting transactions. Therefore, Stock Items are important in an inventory just as ledgers are
important in accounting.

4.5.1 Creating a Stock Item

Go to Gateway of Tally > Inventory Info. > Stock Items > Create.

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Creating Inventory Masters in Tally.ERP 9

The Stock Item Creation Screen appears as shown below:

Figure 4.8 Stock Item Creation screen

Enter the following details:

Name: The name of the stock item.
Under: The stock group under which you want to classify the stock item.
Category: The stock category you want to classify the stock item for parallel
classification. Units: The unit of measure for the stock item being created.
Rate of Duty: Enter the rate of duty charged on the item.
Opening Balance: The opening balance of a stock item, refers to the stock available with us.
Godowns that have already been created, must have the opening balance quantity and the
location specified.

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Creating Inventory Masters in Tally.ERP 9

i. Create a Stock Item Sony 29 inches TV, under the Group Sony TV.
Ensure that the details appear as shown below:

Figure 4.9 Stock Item Creation — Sony 29 inches TV

Press Y or Enter to accept the screen.

Practice Exercise
Similarly, create the following Stock Items under Televisions

Name Under Category Units

Sony 25 inches TV Sony TV 25 inches TV Nos
Philips 29 inches TV Philips TV 29 inches TV Nos
Philips 25 inches TV Philips TV 25 inches TV Nos
Videocon 29 inches TV Videocon TV 29 inches TV Nos
Videocon 25 inches TV Videocon TV 25 inches TV Nos

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Creating Inventory Masters in Tally.ERP 9

Similarly, create the following Stock Items under Music Systems.

Name Under Category Units

Sony Tape - Recorder Sony Music Systems Not Applicable Nos
Sony CD - Player Sony Music Systems Not Applicable Nos
Videocon Tape - Recorder Videocon Music Systems Not Applicable Nos
Videocon CD - Player Videocon Music Systems Not Applicable Nos

4.6 Creating Inventory Masters for National Traders

Before you start to create the inventory data for National Traders, there are some important
functions of housekeeping that are to be taken care of.
Make sure your screen displays the main menu of the Gateway of Tally and ensure that
only National Traders is loaded.
Set Tally.ERP 9’s Current Date to April 1, 2009 – select F2: Date at the Gateway of Tally.
You also need to check whether the following features in Tally.ERP 9 are enabled for this
module
i. In the F11: Features (F2: Inventory Features) set Yes
to: Maintain Stock Categories
Maintain Multiple Godowns
ii. In the F12: Configure > Accts/Inventory Info. set Yes to:
Allow ALIASES along with Names
Allow Language ALIASES along with Names
Allow ADVANCED entries in Masters (Accounts)
Use ADDRESSES for Ledger Accounts
Use CONTACT DETAILS for Ledger Accounts
Allow ADVANCED entries in Masters (Inventory)
Allow Std. Rates for Stock Items

Let us now use Tally.ERP 9 to set up the basic inventory details for National Traders that sells
computers, Printers and Peripherals. Create the stock groups and sub-groups as shown:

Stock Group Under

Computers Primary
Printers Primary
Peripherals Primary
Accessories Peripherals
Components Peripherals

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Creating Inventory Masters in Tally.ERP 9

4.6.1 Create Stock Groups

You will now set up the stock groups using both the single and multiple create options.

i. Creating single stock groups

Go to the Gateway of Tally > Inventory Info. > Stock Groups >
Create. Create a Stock Group - Computers
1. Name: Computers
2. Aliases: Skip the field
3. Under: Primary
4. Can quantities of items be ADDED?: Yes

Figure 4.10 Stock Group Creation — Systems

The field Can quantities of items be added? in the stock group

creation screen pertains to information on measuring the units of the
Stock Items that have been categorised under the Stock Group. The
Stock Items categorised under the group should have similar units for
them to be added up. You cannot add quantities in Kgs to quantities in
Pcs.

5. Press Y or Enter to accept the screen.

Similarly, create the following Stock Groups
.
Name Under Can Quantities of
items be ADDED
Peripherals Primary Yes
Printers Primary No

ii. Creating Multiple Stock Groups

Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create.

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Creating Inventory Masters in Tally.ERP 9

Create Accessories and Components under Peripherals.

Ensure that the Multi Stock Group Creation screen is displayed as shown below:

Figure 4.11 Multiple Sock Group Creation

Press Y or Enter to accept the screen.

4.6.2 Displaying and Altering Stock Groups

Once created, stock groups can be displayed and altered in both the single and multiple mode.
You can delete a stock group by using the option Alter under the Single Stock Group by
pressing Alt+D. However, you cannot delete a stock group with sub-groups or stock items. The
lower levels must be deleted first.

4.6.3 Creating Single Stock Categories

Go to the Gateway of Tally > Inventory Info. > Stock Categories > Create.
Name Under
National Primary

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Creating Inventory Masters in Tally.ERP 9

4.6.4 Creating Multiple Stock Categories

Go to the Gateway of Tally > Inventory Info. > Stock Categories > Create.

Under Category Name of Category

Primary HCL
Primary IBM
Primary HP
Primary Samsung

4.6.5 Displaying and Altering Stock Categories

Once created, stock categories can be displayed and altered in single and multiple mode. You
can delete a stock category via Single Stock Category > Alter by pressing Alt+D. However,
you cannot delete a stock category with sub-categories. The lower levels must be deleted first.

4.6.6 Creating Units of Measure

Go to the Gateway of Tally > Inventory Info. > Units of Measure > Create.
Type Symbol Formal Name Number of Deci-
mal Places
Simple Nos Number Of 0
Simple Box Boxes 0

4.6.7 Creating Compound Units of Measure

Go to the Gateway of Tally > Inventory Info. > Units of Measure > Create.
1. Type: Compound (press Backspace)
2. First Unit: Select Box
3. Conversion: Type 100
4. Second Unit: Select Nos

Figure 4.12 Compound Units of Measure Creation

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Creating Inventory Masters in Tally.ERP 9

Once you have entered all the stock items, return to the main Gateway of Tally menu and select
the Stock Summary. This should show a grand total of 2,86,150, the break-up of which is,
Computers - Rs. 1,55,900, Peripherals - Rs. 32,350, Printers - 97,900 = Rs.
2,86,150. Ensure that the Stock Summary appears as shown :

Figure 4.16 Stock Summary from April 1, 2009 to May 1, 2009

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Creating Inventory Masters in Tally.ERP 9

Points to Remember
Inventory accounting includes recording stock details like the
purchase of stock, the sale of stock, stock movement between storage
locations or godowns and providing information on stock availability.
Stock Groups are provided for the purpose of classification of
stock items.
Stock Items refers to goods that you manufacture or trade.
Godowns/Location are places where stock items are stored.

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Creating a Purchase Entry in Tally.ERP 9
When a company buys goods on credit or cash, Purchase voucher is used to record all the Purchase
transactions of the company.

To pass a Purchase Voucher:

Go to Gateway of Tally > Accounting Vouchers

 Click on F9:Purchase on the Button Bar or press F9.

For example, if you are purchasing goods from Supplier A for a value of Rs. 10000/-

a) Debit Purchase Account

b) Credit Party Account

To pass a Purchase entry in the Invoice mode, you need to enable the option Allow Invoicing option
in F11:Features (F1: Accounting or F2:Inventory Features).

Invoice mode is of two types, namely

 An Account Invoice

 An Item Invoice

Account Invoice: You will be directly selecting/debiting the Ledger account in case you are passing an
Account Invoice. This is useful especially when a Service Bill is entered and does not include Inventory.
Pass a purchase Invoice for Service availed from XYZ Couriers.

Item Invoice: You will be first selecting the Inventory and then allocating the same to the relevant Ledger
account. This is useful to record all the Inventory movements in books of account.

Pass a Purchase Invoice against purchase of Item A – 100 Nos. @ Rs. 10/= per quantity from LMN &
Company.
Configuring a Invoice

Before creating the Purchase Invoice, you can set your Invoice Configurations from F12 configure:

Go to Gateway of Tally > Accounting Vouchers > F9: Purchases (As Invoice)

 Select F12 Configure.

 Set the options, as required.

Purchase Invoice Configuration

1. Accept Supplementary Details: Set this option to Yes to specify the Despatch Details. If this option is
set to No, Print Default Name and Address of Party will be enabled for configuring. Here it captures the
default name and address present in the ledger.
2. Allow separate Buyer and Consignee names: Customers who are into consignment business and
would like to have the Consignee details on the Invoice, have to set this option to Yes.
3. Use Common Ledger A/c for Item Allocation: If you would like to allocate all the Items to a single
Purchase Ledger in the Invoice, you need to set this option to Yes for faster data entry.
4. Allow Expenses/Fixed Assets for Accounting Allocation: If you want to use Expense or Fixed Assets
ledgers while recording a Purchase entry, set this option to Yes.
5. Use Defaults for Bill Allocations: Setting this option to Yes will allocate the Bill Numbers automatically
as defined in voucher type master in ascending order.
6. Use Additional Description(s) for Item Name: If you would like to specify any additional description
for item during entry, this option has to be enabled.
7. Use Additional Description(s) for Ledger Name: If you would like to specify any additional
description for ledger during entry, this option has to be enabled.
8. Consolidate Stock Items with same rates: If you would like to consolidate the stock items having
same rates in Invoice, set this option to Yes.
9. Show Compound Unit of Item based on Rate: By enabling this option, you will be allowed to show the
compound unit of item based on the unit provided in the Rate Per column. For more details, click here.
10. Show Full Details of Compound Unit: Enabling this option will display full details of compound unit in the
Quantity field. For more details, click here.
11. Confirm each Cheque before Print: When you set this option to Yes, a conformation screen will appear for
every cheque used for the transaction before it is printed.
12. Use Defaults for Bank Allocation: Setting this option to Yes, the Bank Allocations will have default
allocations in which, the Transaction type is Cheque, Voucher date as Instrument Date. the Cheque Range
and Cheque Number will be Blank if it is not defined.
13. Use Auto Cheque Numbering: To fetch cheque numbers automatically to the Bank Allocation, set this
option to Yes. The first Cheque Range defined for the Bank ledger will be taken as default.
14. Allow Selection of Cheque Ranges: Setting this option to Yes, allows you to select any cheque range
defined for a bank.
15. Show Remarks in Bank Allocation Details: A new field - Remarks, will appear in the Bank Allocation screen
where you can enter your remarks, when this option is set to Yes.
16. Importer’s Options: This is useful for import transactions.
17. Show turnover achieved with Customer: This option will help to view the turnover details during
entry.
18. Allow modification of ALL fields during entry: Default order/delivery note entries appearing in the
Invoice can be changed during Invoice entry. Set this option to Yes to permit modification of all fields.
19. Warn on Negative Stock Balance: Tally.ERP 9 will display a warning message Negative Stock with
quantity details. You can then check which item is having negative stock balance.
20. Honor Expiry Dates usage for Batches: You can restrict or allow the usage of Expired stocks for
selection during entry by configuring this option.
21. Show batches with Zero Quantity: On setting this to Yes the batches with zero quantity will be
available for selection during entry.
22. Calculate Tax on current Sub-Total: This option should be enabled if the tax needs to be calculated
after considering the additional Expenses.

For more details on Purchase Voucher mode configurations refer Voucher Entry Configuration

Special Keys on the Button Bar:

When you are passing an Item Invoice in Invoice mode, the following options will be available in the
Button Bar.

Alt+I – Acct Invoice – You can toggle between Item Invoice and Account Invoice, by clicking on this
option on the Button Bar or pressing Alt+I or vice-versa.

Ctrl+V – As Voucher – You can toggle between Invoice mode and Voucher mode, by clicking on this option
on the Button Bar or pressing Ctrl+V or vice-versa.

Special Keys for Voucher Narration Field

 ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective of the
voucher type.

 CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of the ledger.
Creating a Sales Entry in Tally.ERP 9
When a company sells goods on credit or cash, Sales voucher is used to record all the Sales transactions of the
company.

To pass a Sales Voucher:

Go to Gateway of Tally > Accounting Vouchers

 Click on F8:Sales on the Button Bar or press F8.

For example, if you are selling goods to Debtor A for a value of Rs. 10000/-

a) Debit Customer’s Account

b) Credit Sales Account

Creating a Sales Invoice in Tally.ERP 9

When a sales transaction is made, a document detailing the transaction (item name, tax, etc) has to be
given to the buyer or debtor as proof of purchase by him. This document is called Invoice or Bill or Cash
Memo. Tally.ERP 9 provides the option of creating Invoices.
Invoice mode is of two types. It may be:
 An Account Invoice
 An Item Invoice
Account Invoice

Sales Account Invoice is generally used by professionals such as doctors and consultants who require to
issue an invoice for certain services provided such as consultancy charges, professional fees, etc.

Trading and manufacturing organizations also use the Account Invoice for invoicing service charges.

On the Sales entry screen, click on Acct Invoice button, which is displayed on the Button Bar on the right-
hand side of the screen to display the Sales Account Invoice screen as shown.

Pass a Sales Account Invoice for Service provided to Debtor B:

Tally.ERP's Account Invoice mode displays the list of ledger accounts, which can be invoiced as required.
This is unlike Item Invoice where Tally.ERP 9 displays the list of stock items.

Item Invoice

Invoicing is generally used for sale of stock where the details of the items sold are listed. Selecting the Item
Invoice allows you to select the stock items that need to be invoiced. Trading and manufacturing
organizations commonly use this format.

On the Sales invoice screen, click on the button Item Invoice, which is displayed on the Button Bar on the
right side of the screen and the Sales Item Invoice appears as shown below:

Pass a Sales Invoice against sale of Item A – 50 Nos. @ Rs. 15/= per quantity to Debtor C:
Tally.ERP's Item Invoice mode displays the list of stock items, which can be invoiced as required.

Special Keys for Voucher Narration Field

 ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective of the
voucher type.

 CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of the ledger.
Concept of Debit & Credit Note
The need for debit note and credit note arises most of the time when there is a Return of
Goods.

Usually when there is a return of goods, the person does not directly give the cash for the
returned goods.

He issues Credit Note if he is a seller.

And the buyer issues a Debit Note for the same transaction to the seller from whom he has
received credit note.

Debit Note
As I issued a Credit Note, at the same time Amit will issue Debit Note to me for the
same transaction.

Amit has returned goods worth ₹5,000 to me and he will issue a debit note for that
amount.

Therefore Amit will show debit balance (Debit = Assets) of me in his books.

This is because Amit has already paid for the goods, but has returned some of them.

On the other hand, I will show credit balance (Credit = Liabilities) of Amit in
my books.

The reason for credit balance is because I have received the goods in return as well as
money for that goods from Amit.

So, now I am liable to pay the money or goods to Amit.

This is the real crux behind debit and credit note.

Debit and Credit Notes in Tally

For using debit and credit notes in Tally, you would have enable them.

To enable the option for debit and credit notes in Tally, follow the steps below.

 From Gateway of Tally, press F11 – Shortcut for Company Features

 Now select, Accounting Features.
 Under Invoicing, set the option Use debit/credit notes to YES.
 Also set YES for:
o Use invoice mode for credit notes
o Use invoice mode for debit notes

Enabling Debit and Credit Notes in Tally

Ctrl+F9 For Debit Note

Ctrl+F8 For Credit Note

Physical Stock Voucher

Physical Stock Voucher is used for recording the actual stock which is verified or counted. It could
happen that the Book Stocks and the Physical Stock do not match. It is not unusual that the company finds
a discrepancy between actual stock and computer stock figure.

Physical vouchers will be useful for recording purposes only if you have configured inventory vouchers to
ignore physical stock differences. If you have configured the vouchers so that physical stock difference is not
ignored, then all transactions subsequent to the physical stock voucher will use the balance as mentioned in
that voucher

To view the Physical Stock Voucher,

Go to Gateway of Tally > Inventory Vouchers

1. Select the button F10: Phys Stk from Button Bar or press Alt+F10.

[Img-32]

Date

Enter the stock taking date.

Name of Item

Select the name of the item from the List of items, for which physical stocks need to be recorded.
Godowns

Select the Godown (Godown will appear only if, Maintain multiple Godowns is activated in F11:Features
:F2:Inventory Features), in which the Physical Stock taking was conducted.

Batch / Lot No

Select the Batch number (Batch details will appear only if, Batch wise details are activated in
the Stock Item Master screen) for which the Physical Stock quantity is to be recorded.

Quantity

Enter the Physical Stock quantity

Note: Physi cal Stock quanti ty w il l be di spl aye d as Actual Stock in the Stock Summary
from the date of e ntry of the Physi cal Stock.

'Optional & Non-Accounting Vouchers' in Tally.ERP 9

The Non Accounting/Unconventional Vouchers are the special vouchers that are used to record
provisional or non-accounting transactions. Unconventional vouchers are mainly used to exclude
unnecessary entries or provisional entries from the books of accounts and make them available for what if
(future reports, projections, forecasts etc.) reports required at any given time.

Predefined Non Accounting Vouchers in Tally.ERP 9

Memorandum Voucher

Optional Vouchers

Reversing Journals

Post Dated Vouchers

Using Optional Vouchers in Scenario Management

'Predefined Non Accounting Vouchers' in Tally.ERP 9

tally.ERP 9 comprises of the following predefined Non-Accounting Vouchers, to suit different business
requirements for recording various transactions. Tally.ERP 9 also allows you to create user-defined Vouchers
(Voucher Types) as per your requirements.

The pre-defined Non Accounting Vouchers are:

 Memorandum Voucher

 Reversing Journal

Along with the above mentioned voucher types, there are two options available namely Post
Dated and Optional for other voucher types.
'Memorandum Voucher' in Tally.ERP 9
This is a non-accounting voucher and the entries made using memo voucher will not affect your accounts. In
other words, Tally.ERP 9 does not post these entries to ledgers, but stores them in a separate Memorandum
Register. You can alter and convert a Memo Voucher into a regular voucher when you decide to bring the
entry into your books.

Some of the uses of Memorandum Vouchers are:

Making suspense payments

Consider that a company gives its employees cash to buy office supplies, the exact nature and cost of which
are unknown. For this transaction you can enter a voucher for the petty cash advance, a voucher to record
the actual expenditure details when they are known, and another voucher to record the return of surplus
cash.

However, a simpler way of doing it is to enter a Memo voucher when the cash is advanced, and then turn it
into a Payment voucher for the actual amount spent, when the details are known.

Consider the following Example:

The Company pays its employee Rs. 1000 as petty cash advance for Office Expenses.

The following entry has to be passed.

To use Memorandum voucher, Enable the following option from F11: Accounting Features

 Use Reversing Journals & Optional Vouchers

Go to Gateway of Tally > Accounting Vouchers > Select Ctrl+F10: Memos from the Button Bar or
click Ctrl+F10.

1. Debit Office Supplies Account

2. Credit Cash Account

Vouchers not verified at the time of entry

If there is no clarity with the details of a voucher you are entering, you can enter it as a Memo voucher and
amend it later when the details are available.

Items given for approval

Generally completed sales are entered into books. In case items are given on approval, use a Memo voucher
to track and convert it into a proper Sales voucher. You can cancel/delete the memo voucher if the sale is
not made.

Memorandum Voucher Register

To view all the memorandum vouchers:

Go to Gateway of Tally > Display > Exception Reports > Memorandum Vouchers.

Note: You can al so vi ew me morandum vouche rs from the D ay Book.

You can alter and convert a Memo voucher into a regular voucher when you decide to consider the entry into
your books. Use Scenarios to see the effect of Memo entries on reports and statements.
Optional Vouchers ' in Tally.ERP 9
Unlike a Memo voucher, this is not a separate voucher type. You can mark an existing voucher (for example,
a payment voucher or a receipt voucher) as Optional. Press CTRL + L or click on Optional from the Button
Bar. This button toggles between Regular and Optional. By marking a voucher Optional, the voucher does
not get posted anywhere but remains in the Optional Voucher Register.

You can make a voucher type Optional to regular, if you need to create a new voucher type or alter an
existing voucher type.

Go to Gateway of Tally > Accounts Info > Voucher Types> select a Voucher Type> Set Make
Optional as default to Yes.

After enabling this option, any vouchers entered using this particular voucher type will be optional.

Enabling Optional Vouchers

Go to Gateway of Tally

1. Select F11:F1: Accounting Features

2. Set Use Rev. Journals & Optional Vouchers? to Yes.

3. Accept the screen to save.

Use of Optional Vouchers

 If you do not want a transaction that is incomplete to affect the accounts, you can mark this as
an Optional Voucher. Once the transaction is complete, modify the voucher and post it as a
Regular Voucher. For example, Proforma sales invoice. In fact, an optional sales invoice is
printed as a Proforma Invoice.

 Optional Vouchers allow you to see the impact of transactions without actually posting them.

 Optional Vouchers can be used to forecast future sales. For example, create a New Voucher
Type - Sales Forecast. Record future sales projections using this voucher type.

Consider an example: it is the 30th of June and you would like to view the Balance Sheet as of today, but
June salaries are not due for payment until the first week of July. The Balance Sheet will not be projecting
the correct figures. To overcome this, you can enter an Optional Voucher dated 30th June.

1. Debit Salaries Account

2. Credit Provisions (Current Liabilities) Account

When you view the Balance Sheet, generate a report with the Optional Voucher included. The Optional
Voucher should be already defined as a Scenario (Refer the section on Scenario Management for more
details). The voucher affects the report temporarily. Once you quit the report, Tally.ERP 9 does not retain
the Scenario details. The next time you view the balance sheet, it will not include the effect of the Optional
Voucher unless you include it.

Note: Use Scenari os to se e the e ffe ct of O pti onal vouche r e ntrie s on re ports and
state me nts.

Optional Vouchers Register

You can view all optional vouchers in the Optional Vouchers Register

Go to Gateway of Tally > Display > Exception Reports > Optional Vouchers.

Note: You c an vi e w O pti onal Vouche rs from the Day Book as w e ll .

Reversing Journals ' in Tally.ERP 9
Reversing Journals are special journals that are automatically reversed after a specified date. They exist
only till that date and are effective only when they are included in reports. These are used in interim
reporting in the course of the financial year where accruals are to be reported. These accruals are usually
short term and are cleared in the subsequent period. However, to get a proper perspective, decision makers
require the reports with full impact of all aspects and transactions.

To activate Reversing Journals,

Go to Gateway of Tally

1. Select F11: F1: Accounting Feature

2. Set Use Reversing Journals & Optional Vouchers? to Yes.

3. Accept the screen to save.

You may use reversion journal for accounting for or providing for depreciation. Since, depreciation is usually
provided during at the end of the year, using the Reversing journal you may include them for monthly
reporting or a specific period to give more accurate status or position.

Let us take an example:

On 30th June you want to view the Balance Sheet but June month’s rent is not been paid. You may create a
Scenario (refer Scenario Management for more information) and pass a Reversing Journal entry to view the
reports which will be effective up to the applicable date. When you view the Balance Sheet, Tally.ERP 9
displays the report with the reversing journals included. The voucher affects the report only for that day,
30th June.

Applicable up to

The reversing Journal is available for inclusion in a scenario report till this date. The Reversing Journal can
be created as of a particular date and made Applicable up to a different date.

Reversing Journal Register

All vouchers are maintained in a Reversing Journal Register. These are not posted to any books of accounts
and cannot be included in regular reports. They can only be seen using a scenario.

Go to Gateway of Tally> Display> Exception Reports> Reversing Journals

Post Dated Vouchers ' in Tally.ERP 9
While entering vouchers, you can mark them as post dated, as a result these vouchers are not updated in
the ledgers till the date specified in the voucher. This is useful for entering transactions that take place on a
regular basis. For example, if you issue post dated Cheques towards payment of installments, you can set
up the payments in advance, and Tally.ERP 9 will only update them in the ledgers on the due date.

Mark vouchers Post Dated by using CTRL + T or click on the button Post dated from the Button Bar. This
button toggles between Current and Post Dated.

Post-dated Vouchers Register

All Post-dated vouchers are maintained in Post-dated voucher Register.

Go to Gateway of Tally> Display> Exception Reports> Post-Dated Vouchers

Difference in the treatment of Post-dated Vouchers and other Unconventional Vouchers

The major difference between post dated vouchers and other Unconventional vouchers is that post dated
Vouchers affect regular books of accounts on the date of the voucher. Post-dated vouchers are not available
for selection in Scenarios.
Purchase Order
Inventory Vouchers
Tally.ERP 9 inventory vouchers perform the same function in the inventory system as
accounting vouchers do. They are the means by which you enter transactions relating to the
Inventory. The vouchers record transactions relating to the issue and receipt of stock, the
transfer of stock between godowns, and physical stock adjustments. The following inventory
vouchers are available in Tally.ERP 9:
Purchase Order (Alt+F4)
Receipt Note (Alt+F9)
Rejections out (Alt+F6)
Purchase (F9)
Payment (F5)

Purchase Order
A Purchase order entry has to be made in the books of the company to assist them in checking
whether the goods have been received or not. The Purchase Order number can be used as a
reference. For example, the company wishes to place an order with the supplier for some goods.
Purchase Order
Description Records placing an order for stock items to suppliers.
Details recorded Supplier's Ledger account, Name and address, Order details, name
of stock item, Due on, Godown, Quantity, Rate, Amount, Narration.

Receipt Note
Goods that are received from the supplier are recorded in a Receipt Note (Goods Receipt Note
– GRN) voucher.
Receipt Note
Description Records receipt of new stock from suppliers
Details recorded Reference, ledger account, (If supplementary details are set to yes in F12:
Receipt Note Configuration) then, Order details, Supplier’s name and
address, name of stock item, Tracking details, Order details, Godown,
Quantity, Rate (optional), Amount (optional), narration.

Rejections Out
A Rejection Out entry is passed to record the rejected goods. This is a pure inventory voucher.
For example: We have purchased some goods and have rejected a part of it.
Rejections Out (Purchase Returns)
Description Records rejected stock details returned to suppliers.
Details recorded Ledger Account, Suppliers name and address, stock item, Tracking
details, Order details, Godown, Quantity, Rate, Amount, and Narration.
Purchase voucher
For example: the company receives new stock from a supplier.

Purchase Voucher
Description Records receipt of new stock with invoice from suppliers.
Details recorded Reference, ledger account, supplier’s name and address, name of
stock item, godown, quantity, rate, amount, purchase ledger, other
ledgers (if required), narration.

Payment

A payment entry has to be made in the books of the company to assist them in checking whether
the goods have been received or dues is clear or not. The Purchase number can be used as a ref-
erence. For example, the company wishes to place an order with the supplier for some goods.
Payment
Description Clear the Dues to suppliers.
Details recorded dues is clear to the party

Purchase Order (Alt+F4)

Receipt Note (Alt+F9)

Rejections out (Alt+F6)

Purchase (F9)

Payment (F5)

Stock Summary
Go to the Gateway of Tally > Stock Summary.
Sale Order:

Inventory Vouchers
Tally.ERP 9 inventory vouchers perform the same function in the inventory system as
accounting vouchers do. They are the means by which you enter transactions relating to the
Inventory. The vouchers record transactions relating to the issue and receipt of stock, the
transfer of stock between godowns, and physical stock adjustments. The following inventory
vouchers are available in Tally.ERP 9 :
Sales Order (Alt+F5)
Delivery Note (Alt+F8)
Rejections in (Ctrl+ F6)
Sale Voucher (F8)
Receipt Voucher (F6)

Sales Order
A Sales Order entry has to be made to record this. The Sales Order number can be used as a ref-
erence. For example, a customer places an order with the company for purchasing some goods.
Sales Order
Description Records order details for stock items received from customers.
Details recorded Customer's Ledger account, Name and address, Order details, name
of stock item, Due on, Godown, Quantity, Rate, Amount, Narration.

Delivery Note
Goods that are being delivered to a customer are recorded in a Delivery Note voucher.
Delivery Note
Description Records delivery of new stock to customers
Details recorded Reference, ledger account, supplier’s (if supplementary details are set to
yes in F12: Delivery Note Configuration) then, name and address,
Order & dispatch details, name of stock item, Tracking details, Order
details, Godown, Quantity, Rate(optional), Amount(optional), narration.

Rejections In
A Rejection In entry is passed to record the rejected goods. The Rejections In entry is a pure
inventory voucher. For example a customer has rejected goods that was sold earlier.

Rejections In (Sales Returns)

Description Records rejected stock details received from customers
Details recorded Ledger account, Customer's name and address, stock item, tracking
details, order details, Godown, Quantity, Rate, Amount, Narration.
Sales voucher
For example: the company delivers goods from its stock to a customer.

Sales Voucher
Description Records the delivery of goods and invoice to customers.
Details recorded Reference, ledger account, customer’s name and address, name of
stock item, godown, quantity, rate, amount, sales ledger, sales tax
ledger (if required), narration.

Receipt voucher
For example: the company Received all dues from customer.

Sales Voucher
Description Company Received all dues from customer.
Details recorded Company Received all dues from customer.

Sales Order (Alt+F5)

Delivery Note (Alt+F8)

Rejections in (Ctrl+ F6)

Sale Vuocher (F8)

Receipt Voucher (F6)

Stock Summary
Go to the Gateway of Tally > Stock Summary.
Creating Inventory Masters in
Tally.ERP 9

Lesson Objectives
On completion of this lesson, you will be able to understand

The basic functions of the Tally.ERP 9 Inventory System

Creating and maintaining Inventory Masters
Creating and maintaining stock details
Creating stock items and entering opening balances

Figure 4.1 Inventory Info. Menu

The above Inventory Masters types are explained in detailed in the following
sections. Units of Measure

Group B – Music Systems

B1 – Sony B1a – Sony Tape-Recorder
B1b – Sony CD Player
B2 – Videocon B2a – Videocon Tape-Recorder
B2b – Videocon CD Player

The televisions are sold in numbers. Hence, the Unit of Measure will be Nos.
Creating Inventory Masters in Tally.ERP 9

4.1 Stock Groups

4.1.1 Creating Stock Group

Figure 4.2 Stock Group Creation — Television

Creating Inventory Masters in Tally.ERP 9

Press Y or Enter to accept the screen.

Similarly, create Music Systems under Primary.

ii. Create Sony TV under Televisions.

The screen is displayed as shown below:

Figure 4.3 Stock Group Creation — Sony TV

Press Y or Enter to accept the screen.

4.2 Stock Categories

Set Yes to Maintain Stock Categories in F11: Features (F2: Inventory Features) to get
an additional option Stock Categories under Inventory Info.
Creating Inventory Masters in Tally.ERP 9

4.2.1 Creating Stock Category

Go to the Gateway of Tally > Inventory Info. > Stock Categories >
Create. i. Create Stock Category 29 inches TV Under Primary

Figure 4.4 Stock Category Creation — 29 inches TV

Press Y or Enter to accept the screen.

Similarly , create Stock Category 25 inches TV under Primary.

4.3 Godowns / Locations

Set Yes to Maintain Multiple Godowns in F11: Features (F2: Inventory Features) to
get additional option like Stock Categories under Inventory Info.

4.3.1 Creating a Godown

Go to the Gateway of Tally > Inventory Info. > Godowns >
Create. i. Create a Godown – Bangalore under Primary.
Ensure that the screen is displayed as shown below:

Figure 4.5 Godown Creation — Bangalore

Creating Inventory Masters in Tally.ERP 9

Press Y or Enter to accept the screen.

Godowns have a main location, by default because of which the

options Display and Alter are functional even before you create a
godown.

Similarly create the godown – Mumbai under Primary.

4.4 Units of Measure

4.4.1 Creating Units of Measure

Go to the Gateway of Tally > Inventory Info. > Units of Measure >
Create. The Unit Creation Screen appears as shown below:

Figure 4.6 Units of Measure Creation screen

Type
Tally.ERP 9 has the option to create simple units as well as compound units. Examples: box,
nos, pcs, etc. A Compound Unit is a combination of two simple units of measure. Example: A
box of 10 pcs is a compound unit of measure.
Symbol
It is the abbreviated form by which a stock item is identified. For example, the abbreviation pcs
indicates – pieces.
Formal Name
This represents the complete or formal name of a symbol used while creating a unit. Different
companies use different symbols to represent the same units. Formal names help you to match
the symbols with their respective units. For example, the symbol for numbers (formal name) can
be nos or num.
Number of Decimal Places
A unit can be expressed as fractions. For example, a 3.15 Kg refers to 3Kg and 150 grams. The
number of digits expressed in grams after the decimal places are three. Likewise, fractions up to
four decimal places can be expressed in the same manner. For expressing numbers, without a
decimal place, specify 0 in this option.

Let us create the unit Nos.

1. Type: Simple
2. Symbol: Nos
3. Formal Name: Numbers
4. Number of Decimal Places: 0

The Unit Creation screen is displayed as shown below:

Figure 4.7 Units of Measure Creation — Nos

5. Press Y or Enter to accept the screen.

4.5 Stock Items

4.5.1 Creating a Stock Item

Go to Gateway of Tally > Inventory Info. > Stock Items > Create.
Creating Inventory Masters in Tally.ERP 9

The Stock Item Creation Screen appears as shown below:

Figure 4.8 Stock Item Creation screen

Enter the following details:

i. Create a Stock Item Sony 29 inches TV, under the Group Sony TV.
Ensure that the details appear as shown below:

Figure 4.9 Stock Item Creation — Sony 29 inches TV

Press Y or Enter to accept the screen.

Practice Exercise
Similarly, create the following Stock Items under Televisions

Name Under Category Units

Similarly, create the following Stock Items under Music Systems.

Name Under Category Units

4.6 Creating Inventory Masters for National Traders

Let us now use Tally.ERP 9 to set up the basic inventory details for National Traders that sells
computers, Printers and Peripherals. Create the stock groups and sub-groups as shown:

Stock Group Under

Computers Primary
Printers Primary
Peripherals Primary
Accessories Peripherals
Components Peripherals
Creating Inventory Masters in Tally.ERP 9

4.6.1 Create Stock Groups

You will now set up the stock groups using both the single and multiple create options.

i. Creating single stock groups

Figure 4.10 Stock Group Creation — Systems

The field Can quantities of items be added? in the stock group

5. Press Y or Enter to accept the screen.

Similarly, create the following Stock Groups
.
Name Under Can Quantities of
items be ADDED
Peripherals Primary Yes
Printers Primary No

ii. Creating Multiple Stock Groups

Go to the Gateway of Tally > Inventory Info. > Stock Groups > Create.
Creating Inventory Masters in Tally.ERP 9

Create Accessories and Components under Peripherals.

Ensure that the Multi Stock Group Creation screen is displayed as shown below:

Figure 4.11 Multiple Sock Group Creation

Press Y or Enter to accept the screen.

4.6.2 Displaying and Altering Stock Groups

4.6.3 Creating Single Stock Categories

Go to the Gateway of Tally > Inventory Info. > Stock Categories > Create.
Name Under
National Primary
Creating Inventory Masters in Tally.ERP 9

4.6.4 Creating Multiple Stock

Categories
Go to the Gateway of Tally >
Inventory Info. > Stock Categories
> Create.

Under Category Name of Category

Primary HCL
Primary IBM
Primary HP
Primary Samsung

4.6.5 Displaying and Altering

Stock Categories
Once created, stock categories can
be displayed and altered in single
and multiple mode. You can delete
a stock category via Single Stock
Category > Alter by pressing
Alt+D. However, you cannot delete
a stock category with sub-
categories. The lower levels must
be deleted first.

4.6.6 Creating Units of Measure

Go to the Gateway of Tally >
Inventory Info. > Units of Measure
> Create.
Type Symbol Formal Name Number of Deci-
mal Places
Simple Nos Number Of 0
Simple Box Boxes 0

4.6.7 Creating Compound Units

of Measure
Go to the Gateway of Tally >
Inventory Info. > Units of Measure
> Create.
1. Type: Compound (press
Backspace)
2. First Unit: Select Box
3. Conversion: Type 100
4. Second Unit: Select Nos

Figure
4.12
Compou
nd Units
of
Measure
Creation

Creating Inventory Masters in Tally.ERP 9

5. Press Y or Enter to accept the screen.

4.6.8 Displaying and Altering Units of Measure

Once created, the units of measure can be displayed and altered. You can delete a unit of
measure in the alteration screen by pressing Alt+D. However, you cannot delete a unit of
measure that is part of a compound measure. The compound measure must be deleted first.

4.6.9 Creating Godowns

Ensure that Maintain Multiple Godowns is set to Yes in the F11: Features (F2: Inventory
Fea-tures).
The concept of Godowns is essentially to store the inventory and can be used as a location,
warehouse, department, sub-contractor locations etc. Tally.ERP 9 permits any number of
godowns that can be grouped and sub-grouped to match the structure you need.

To Create a Godown, go to the Gateway of Tally > Inventory Info. > Godowns > Create.
1. Name: Warehouse
2. alias: Skip the field
3. Under: Primary
4. Allow Storage of materials: Yes
Similarly, create On-Site as Godown under Primary.
1. Name: On - Site
2. alias: Skip the field
3. Under: Primary
4. Allow Storage of materials: Yes

4.6.10 Displaying and Altering Stock Godowns

Once created stock Godowns can be displayed and altered in single and multiple
mode. Go to the Gateway of Tally > Inventory Info. > Godowns > Alter.

You can delete a stock Godown via Single Godown > Alter by pressing Alt+D. However, you
cannot delete a stock Godown with sub-godowns. The lower levels must be deleted first.

Stock transfers to Godowns in TallyERP 9

Multiple Warehouses / Locations in TallyERP 9
Create a New Security Level - in Tally.ERP 9
Security Controls

Security control is an essential part of any organisation, without which an employee may be performing a
number of non-essential tasks, for example: a data entry operator could create Masters, view the Trial
Balance, Final Accounts, Ratio Analysis or delete essential information etc.,

Security controls need to be defined based on the work profile of an employee. Typically, in an organisation
the administrator has all the access rights to the system, whereas the employees are given access rights
based on their work profile demonstrating segregation of duties.

Types of Security Levels

By default Tally.ERP 9 has two levels of Security namely Owner and Data Entry.

Owner - The owner has full access rights which will enable him to work with all the features of Tally.ERP 9,
except for Tally Audit and Company Alteration which are reserved for the Administrator. Based on pre-
defined security levels the Administrator can create other security levels and assign or restrict access based
on the requirement.

Data Entry - Data Entry has restricted access but the administrator can assign or restrict the access based
on the requirement.

Create a New Security Level

Creating a new security level is a two step process which involves the creation of an Administrator Login and
then creation of the users.

Enabling Security Control for a Company (Administrator Login)

To create security levels you should login as the administrator. The administrator login has to be created in
the Company Creation or by altering the Company Masters.

Go to Gateway of Tally > Click F3 : Cmp Info. > Alter

1. Select the required company from the List of Companies

2. In the Company Alteration screen set Use Security Control to Yes

3. Enter the administrator’s name in Name of Administrator field

4. Enter the password. Tally.ERP 9 displays the strength of the password entered depending on
the combination - Alphabets, Numbers & Special Characters.

5. Repeat the password for the purpose of confirmation.

Note: To e nsure user pri vacy and hi ghe r confi de nti ali ty, the passw ord i s encrypte d.

5. Accept to save the enhancements made

Note: The ste ps show n above are through the Company Maste rs Al te rati on w here as the use r
can cre ate the admi ni strator l ogi n and passw ord while cre ati ng the company. Incase you are
al teri ng the company maste rs then cl ose and re -l oad the company for the se curity co ntrol
me nu to be e nabl e

Disable Security Control

Security Control of a company can be disabled at any point of time.

To disable the Security Control,

 Load the Company for which Security Control to be disabled

 Press Alt+ F3 keys or click on F3: Cmp Info button from Gateway of Tally to
navigate Company Info menu

 In Company Info menu, select the option Alter and press Enter to view Company
Alteration screen

 In Company Alteration screen, tab down to Use Security Control field and set it to No
 On Setting this option to No, Tally.ERP 9 will prompt you to enter the Current/Existing
Password

On specifying the Existing Password and saving the Company Alteration, Tally.ERP 9 will prompt to
reload the Company and on confirmation company will be loaded without requesting
for User Name and Password.

Create Security Levels

To create a new security level you have to login as an administrator.

Go to Gateway of Tally > F3: Company Info > Security Control

1. Select Types of Security

2. The Security Levels screen displays the List of Security Levels. You can create a new security level
for which you have to enter the required security level.

3. Press Enter to open the Security Levels screen

Assigning Security Level - in Tally.ERP 9
 The Name of the Security Level is the one you have entered in the previous screen

 Use Basic Facilities of – the administrator can select the required facility from the Security List.
In case there already exists user defined security levels, they will be displayed in the Security
List. The new level created will be displayed when the user creates another security level

 Days Allowed for Back Dated Vouchers – By default this field is set to 0, enter the required
number of days. Alteration or Insertion of backdated vouchers can be done within the number
of days mentioned from the Date of Last Entry of vouchers

 Cut-off date for Backdated vouchers – the user can specify the required date. Tally.ERP 9 does
not allow you to record a transaction prior to the date mentioned. This can be used in addition
to Days Allowed for Backdated Voucher. This input will be useful in situations where you have
completed the audit and do not require any changes in the data

 Set Rules for Print Before Save - set this option to Yes in order to restrict a security level from
printing the required voucher type before saving the voucher or restrict a security level from
printing all the available voucher types before saving the vouchers
By de faul t Set Rul es f or Pri nt Bef ore Save i s se t to No w hi ch al l ow s the use r to pri nt all
the avail abl e vouche r types.

The Print Vouchers Before Save Rules screen appears

In Allow the following Voucher Types

 From the Types of Vouchers displayed select the required voucher type that is allowed for
printing before save

In Disallow the following Voucher Types

 From the Types of Vouchers displayed select the required voucher type that need to be
disallowed for printing before save
 Allow to Connect Company – by default it is set to No. Set this to Yes if you need to connect
the respective company to the Tally.NET Server

 Use Tally.NET Authentication – by default it is set to No. Set this to Yes if you need to work
from a remote location

 User Tally.NET Auditor Authentication – by default this option is set to No. Set it to Yes if you
want to scrutinise the data of the client from a remote location

 Permissions for Security Levels – The columns Disallow the following Facilities or Allow the
following Facilities are further divided into two columns each

 Disallow the Following Facilities - To disallow access to different options, select the required
type of access from the Type of Access and then select the report for which the access rights
are restricted from the List of Reports. You can set the access rights for different options. E.g.,
Select Full Access for the Balance Sheet, you will not have access to the Balance Sheet for this
Security Level

 Allow the following Facilities – Conversely when you select Full Access to the Balance Sheet,
there will be full access to the Balance Sheet for this security level
 Press Enter to return to Security Levels for Company screen. You can create the next security
level following similar steps or press Enter to save and return to Security Control Menu.

Creating Users and Passwords - in Tally.ERP 9

You can create users, assign security levels, restrict/allow remote access and local TDLs for the users
created.

To create the user and assign a password execute the following steps:

Go to Gateway of Tally > F3: Company Info > Security Control

1. Select Users and Passwords

2. The List of Users for Company screen is displayed as shown

3. Select the required Security Level from the Security List

4. Enter the user’s name in the Name of User field.

5. Enter the password in Password (if any) field.

6. By default Allow Remote Access and Allow Local TDL is set to No and skipped for users not
classified under Tally.NET User and Tally.NET Auditor

7. Accept to create the user

Altering/Displaying Users and Passwords and Types of Security

You have to use the same menu to alter or delete User and Password and the Types of Security. To delete
an user, go to the List of Users for Company screen delete the user and save. It is recommended to delete
the User before deleting the security level.
Voucher Type Security - in Tally.ERP 9
Tally.ERP 9 Release 4.5 provides the enhanced capability to set a much deeper level security on individual
Voucher Types for different users.

Voucher Type Security will help the business owner specify both individual Voucher Type (Contra,
Payment, etc.) restriction and activity level (Sales Department, Procurement Department etc) restriction
for different users.

The types of functions or activities for which the control can be set include being able
to Create, Alter, Print, or have Full Access to any particular type of Voucher in Tally.ERP 9.

Benefits of Voucher Type Security

With Tally.ERP 9's Voucher Type Security feature, the administrator can

 Create a department and role based segregation of access for different users.

Example: Access based on Sales, Purchase, Accounts and Payroll etc. for employees in those
areas of work.

 Provide or deny access to what level of activity can be performed on a Voucher by different
users

Example: User A & User B can Create and Alter a Payment Voucher, but User C can only view
the same.

 Provide access to an entire group of Vouchers like Accounting Vouchers, or Inventory

Vouchers as a whole.

Setting up Voucher Type Security for users

Example: ABC Company has a user Arun, who records Sales and Receipt transactions. Access to Create
and Alter Sales and Receipt Vouchers has to be provided to him.

In Security Levels screen, Voucher Types and Group of Vouchers (Accounting Vouchers, Inventory
Vouchers, Order Vouchers and Payroll Vouchers) have been included in List of Reports to set the
Voucher Type Security.
[Img-12]

Note : The al i ases provi ded for Voucher Types w i l l not be di spl aye d i n
the Li st of Reports w hil e de fi ning Vouche r Type Se curi ty.

To provide access to Create/Alter Sales and Receipt Voucher Types, configure the Security Level as
shown:
[Img-13]

When the login details of Arun are used to access the Company,

[Img-14]

In Gateway of Tally, only Accounting Vouchers option is displayed.

[Img-15]

On navigating from this option, only Receipt and Sales Vouchers are enabled for recording transactions.

[Img-16]

If the user Arun navigates to Day Book, Tally.ERP 9 will display all the Vouchers recorded during the period
specified, but will not allow the user to Alter/Print the Vouchers which are restricted. If the user selects any
Voucher other than Receipt or Sales Vouchers, Tally.ERP 9 will display the error No Access Allowed!.
[Img-17]

Security for pre-defined groups of Vouchers

Tally.ERP 9 provides four pre-defined groups of Vouchers in order to facilitate users to quickly configure
Voucher level security.

The Voucher Types in Tally.ERP 9 are grouped under the following categories:

1. Accounting Vouchers

The following Voucher Types are grouped under Accounting Vouchers:

 Contra

 Payment

 Receipt

 Journal

 Sales

 Credit Note

 Purchase

 Debit Note
 Reversing Journal

 Memorandum

2. Inventory Vouchers

The following Voucher Types are grouped under Inventory Vouchers:

 Rejections In

 Rejections Out

 Stock Journal

 Delivery Note

 Receipt Note

 Physical Stock

 Material In

 Material Out

3. Order Vouchers

The following Voucher Types are grouped under Order Vouchers:

 Sales Order

 Purchase Order

 Job Work Out Order

 Job Work In Order

4. Payroll Vouchers

The following Voucher Types are grouped under Payroll Vouchers:

 Payroll

 Attendance
Points to remember:

 If users are Allowed/Disallowed access to any of the groups listed above,

the Voucher Types listed under the respective group will also carry the same access
configuration.

 Disallowing access to Voucher Types will not affect the user's access to Create Voucher
Types. To restrict a user from Creating Voucher Types, access to Masters has to be
Disallowed.

Therefore, according to the example above, as Arun has been Disallowed access to Payment
Voucher, he cannot record transactions using Payment Vouchers, but he can still Create a
Voucher under Payment Voucher Type. To restrict Arun's access for Creating Vouchers under
Payment Voucher Type, access to Accounting Masters has to be Disallowed.

Voucher Type Security Add-ons and Voucher Type Security feature in Tally.ERP 9

If an Add-on for providing Voucher Type Security is already in use,

 Access configurations defined using Tally.ERP 9 and the Add-on will be combined.

Example: If, for User A, Full Access to Payment Voucher is Disallowed in Tally.ERP 9, and in
the Add-on Full Access to Receipt Voucher is Disallowed, User A will not be able to access both
Payment and Receipt Vouchers.

 Tally.ERP 9's Voucher Type Security configuration will override the Add-on's configuration.

Example: If for User A, Full Access to the group Accounting Vouchers is Disallowed in
Tally.ERP 9, and in the Add-on Full Access to Payment Voucher is Allowed, User A will not
be able to access Payment Voucher.

Password Policy - in Tally.ERP 9

Keeping financial data safe is of utmost importance to preserve its purity, avoid unauthorized changes and to
keep customers’ financial information safe.

A good password policy will enhance data security and allow only authorized users to view financial data. In
Tally.ERP 9, the Administrator can set a password policy in place; which users will have to adhere to, while
creating and managing passwords for their company.

Features of Password Policy

Password Strength
Password Strength is the level of complexity which is attributed to your password, which will keep it safe from
unauthorized attempts to retrieve or guess it. The components that decide the strength of a password are its
length, complexity and unpredictability.

Using strong passwords lowers overall risk of security breach, but strong passwords do not replace the need for
other effective security controls.

Password Strength is one of the password policies that comprise of two elements:
 Minimum Password Length is the least number of characters that a password for a user, should
contain.
 Password Combinations helps users to strengthen their passwords and makes it difficult for
unauthorized users to figure out these passwords.

Password Expiry
Password Expiry is a mechanism which requires users to change their passwords regularly. This is done
because, over time users tend to give out their passwords, write it down, or otherwise compromise the secrecy
of their passwords. Passwords leaked over time pose a security risk, which is mitigated by Password Expiry.

Password Expiry mechanism expects users to change their passwords at regular time intervals. This time interval
is defined by the Administrator.

For example: If Administrator configures the Password Expiry as 90 days, users have to change their passwords
every 90 days.

Password Expiry has another feature:

 Notifying users when password expires.

Users will be notified before their passwords get expired, when they log-in to the company.

For example: If Administrator configures the Notification to be sent before password expiry as 5 days. Users will
be notified from the 85th day about the password expiry till they change the password.

Password History
It’s possible to maintain a user’s password history and prevent the user from re-using their old passwords. The
Administrator can specify how many previous passwords that should be stored in the Password History.

This would help in maintaining the secrecy of the Company data.

Policy Overriding
Some users can be excluded from following the Password Policy as they might be higher up in grade than the
Administrator, like Supervisor, Manager, etc. For these users the Administrator can remove the Password Policy.

Allow user to change Password

The Administrator can allow a user to change his/her own password at any point in time as per the Password
Policy described.

Configuring Password Policy - in Tally.ERP 9

Password Policy is implemented in Tally.ERP 9 from Release 3.6. Based on this, there are two types of users:

 Existing/Old Tally users (i.e., Tally users before Release 3.6 )

 New Users Of Tally (Fresh Users from Release 3.6 )

For both users, Password Policy will be applicable, only if they activate it.

To do so,
Go to Gateway of Tally > Company Info > Security Control > Password Policy

The Password Policy for Company screen will appear as shown:

Set Yes to the option – Activate Password Policy.

Note: Admi nistrator can also di sabl e the same afte r some i nterval . Poli cy wi ll retai n the
same val ue s once i t is re -enabl e d.

To configure the various features of Password Policy, click on the links below:

1. Password Strength

2. Password Expiry

3. Password History

4. Policy Overriding

5. Changing password on first login

6. Allow Users to Change Password

7. Other Features

1. Password Strength

To configure Password Policy for a Security Control enabled Company:

Go to Gateway of Tally > Company Info > Security Control > Password Policy

The Password Policy for Company screen will appear as shown:

In Minimum Password Length field, the Administrator can specify the minimum number of characters that a
password should contain. By default, 8 will be the Minimum Password Length (This value is derived from the
PCI-DSS standards).

Administrator can still change this value as per the requirement.

By setting Specify ADVANCED Password Strength to Yes, the Administrator can configure User’s Password
Strength by instructing them to use Alphabets, Numerals, and Special Characters in the passwords.
The Administrator can specify the Minimum number of the Alphabets, Numerical, and Special Characters that
the password should comprise.

This will help user to form a strong password.

Note: If the Passw ord Le ngth i s 0 the opti on, Speci fy ADVANCED Password
Strength w il l be ski ppe d.

2. Password Expiry

In the Password Expiry section of the Password Policy:

Password expiry period can be mentioned in the Password Expires after field, in days. By default, the value
will be 90 days, which is derived from the PCI-DSS.

Administrator can configure the Notification period for the Password expiry. By default the period will be 1 day.

Note: Admi nistrator cannot se t Noti ty bef ore val ue a s 0 days.

3. Password History

Password History maintained in Tally.ERP 9 is used to restrict the usage of previous passwords.
Administrator can configure the No. of old Passwords to be restricted after enabling the option - Restrict
the use of old Passwords
Note: Admi nistrator cannot se t the val ue as 0 i n No. of ol d passwords to be
restri cted .

4. Policy Overriding

Administrator can override Password Policy for particular users as per the requirement.

To override Password Policy for a user:

Go to Gateway of Tally > Company Info > Security Control > User and Passwords
In the F12: Configuration, enable Show Apply Password Policy as shown:

Apply Password policy column will be appear in the List of Users for Company screen.

By default it will be enabled for all users.

Administrator can disable this option for some users as per his requirements.

5. Change password on first login

If the password policy followed in the organisation requires users to change their passwords upon first
login, enable the option Change password on first login:
So when a user, say User A, logs into the company for the first time, the Change Password screen
appears as shown, with the message Password policy requires you to change password on first
login:

 Current/Existing Password: Enter the existing password in this field

 New Password: Enter the password you wish to use in this field

 Repeat New Password: Enter the password that was entered in New Password field

 The strength of the new password will be indicated below the Repeat New
Password field.

6. Allow user to change Password

As a part of Password policy, Administrator can also allow his users to change their own passwords.

He can enable this option in the Password Policy screen as shown:

If this option is enabled, user can change their password in:

Gateway of Tally > Company Info.

Upon clicking Change Password, the Change Password screen is displayed:

 Current/Existing Password: Enter the existing password in this field

 New Password: Enter the password you wish to use in this field

 Repeat New Password: Enter the password that was entered in New Password field

 The strength of the new password will be indicated below the Repeat New Password field.

7. Other Features

User Status
Apart from configuring Password Policy, Administrator can also make a user Active or Inactive. Only active users
are allowed to log in to the company while Inactive users are not allowed to load the company.

To set the status for a user:

Go to Gateway of Tally > Company Info > Security Control > User and passwords > F12: Configure

And enable Show User Status.

User Status column will appear in the List of Users for Company screen.

By default, all users will be Active.

Administrator can make a user Inactive, after which the user will be restricted to log in to the company.

Enabling TallyVault - in Tally.ERP 9

The user can enter the TallyVault password while creating the company or execute the following steps to
provide the TallyVault password for existing companies.

1. Load the Company that has to be secured using TallyVault.

2. Go to Gateway of Tally press F3 : Company Info > Change TallyVault

3. In the Change TallyVault screen select the required company from the List of Companies.

4. Enter the Password in the New Password field. Tally.ERP 9 displays the strength of the password
entered depending on the combination - Alphabets, Numbers and Special Characters.

Note: To unde rstand the condi ti ons that de termi ne a Passw ord's stre ngth,
cl ick Password Strength Indicator .
3. Re-enter the password to confirm in the Repeat New Password field.

4. Accept to Change the TallyVault password.

5. Tally.ERP 9 displays a message Created New Company followed by the new Company Number,
press any key to return to Company Info menu.

Once the company data is encrypted the Name of the Company and Financial Year will not be visible in
the Select Company screen.

8. In the Company Info, press Select

9. The Select Company screen with the encrypted company is displayed as shown.
10. Select the encrypted company, Tally.ERP 9 will prompt the user to provide the TallyVault
password.

11. Provide the required password and the company data is available for use in a readable format.

The above procedure will ensure that the data/information is available only to authorised users.

To enable TallyVault while creating a new company, you must provide the TallyVault password and
repeat the password, the new company created will be secured using TallyVault.

Altering TallyVault for a Company - in Tally.ERP 9

To alter the TallyVault for an existing company execute the following steps:

Go to Gateway of Tally > Press F3: Company Info > Change TallyVault

Repeat the entire process as described in Enabling TallyVault in Existing Company. The Change TallyVault
screen has an additional field Current Password; enter the present password in the Current Password field.
Enter the new password in the New Password field and repeat the same password in the Repeat New
Password field.

1. Accept to Change the TallyVault password.

2. Tally.ERP 9 prompts the user with a message Created New Company

xport Of Data - in Tally.ERP 9
The Export option in Tally.ERP 9 allows the user to export reports or data. The exported reports or data can
be viewed or published using any one of the standard formats available. You can also import the same data
into another company using Tally.ERP 9.

The user can open any report in Tally.ERP 9 and click on the E: Export button or press Alt + E to export
data.

[Img-27]

The Report Generation screen is displayed with the export details. Press Yes to accept or press Backspace to
change the export details.

Language

Based on the option selected in the Language field, the user can export reports in English or any of the
available Indian Language. When the user selects Default (All Languages) the report is exported in any
available Indian Language. If the user selects Restricted (ASCII Only), the reports are exported in English
only. However, the user has to select the appropriate display language before exporting.

[Img-28]

Note: If the use r sel ects Restri cted (ASCII Onl y) Language and uses PDF
/HTML Form at to e xport re ports of a company cre ate d usi ng any one of the
avai lable Indi an Languages (wi thout Engl i sh al i as) , the e xporte d val ue s wil l appe ar
as Q uesti on Marks (? ) .

Formats

By default Tally.ERP 9 supports the following export formats, to read more about the Export Formats click on
one of the corresponding links:

 ASCII (Comma Delimited)

 Excel (Spreadsheet)
 HTML (Web Publishing)

 JPEG (Image)

 PDF (Portable Data Format)

 XML (Data Interchange)

Export Formats - in Tally.ERP 9

The Export functionality available in Tally.ERP 9 allows the user to export data or report in any one of the
standard available formats. Tally.ERP 9 allows the user to select the required format before exporting the
data and based on the format selected the user needs to specify the resolution, page size and formatting.

Tally.ERP 9 also allows you to export the data in non-editable formats such as JPEG and PDF formats. The
JPEG format has the with dual facility, where the user can store the file in printable format or as an image.

[Img-29]

ASCII (Comma Delimited)

By selecting the ASCII (Comma Delimited) format, the user can export all the reports or data from Tally.ERP
9. The data exported is converted to plain text separated with commas and stored in a file with the
extension .txt. This file format is widely used for emailing and used for importing data into another company
using Tally.ERP 9
[Img-30]

Excel Spreadsheet

The user can export data and reports generated in Tally.ERP 9 to Excel by selecting the Excel (Spreadsheet)
format. The report or data is put in columns and the file is saved with the extension .xls. Tally.ERP 9 also
gives the user an option to export data with formatting and background colour as it appears in Tally.ERP 9.
The user can set the formatting and background colour in the Report Generation screen. The Excel file can
be emailed as an attachment and also used to generate graphs for better presentation.

[Img-31]

Note : Export to Exce l i s compati ble wi th Microsoft O ffi ce 97 or hi ghe r ve rsi ons onl y.

Tally.ERP 9 exports the data faster when Excel (Spreadsheet) Formatting is set to No

HTML (Web Publishing)

On selecting the HTML (Web Publishing) format, Tally.ERP 9 exports the data in HTML format retaining the
colours and formatting. The file name has an extension .htm, It can be sent as an attachment and read
using an internet browser. It is recommended to choose a higher resolution for better quality output.
[Img-32]

JPEG (Image)

On selecting this format the specified report is exported as an image file which is stored with an
extension .jpg in the specified folder. The image file generated is non-editable, platform independent and
supports the highest level of compression. The user needs to specify the paper orientation and paper size,
opting to store the report on a User defined or customised paper size, the user is required to specify the
page width and height in millimeters. This image file can be mailed as an attachment to a recipient, viewed
using an image viewer and printed.

[Img-33]

PDF (Portable Document Format)

The report is converted to a portable data format document which is independent of the application
software, hardware and operating system. This document can be viewed using the Adobe Acrobat Reader
commonly known as the PDF Reader. On exporting the data using PDF format, the file is stored in the
specified location and assigned the extension .pdf. While configuring the system to export data to PDF it is
necessary for the user to specify the paper orientation and paper size. On opting to store the report
with User defined or customised paper dimensions, the user is required to specify the page width and
height in millimeters. This PDF file can be mailed as an attachment to the desired recipient and viewed using
the Adobe Acrobat reader or PDF reader.
[Img-34]

XML (data interchange)

Extensible Markup Language (XML) is an extension of HTML. Using XML, data can be imported by other
systems. An XML file from Tally.ERP 9 has an XML envelope and formatted with XML tags to enable import
into other systems. The destination system requires re-formatting of XSLT (XML Style Sheets) based on the
inherent style used in Tally before importing the data. When two systems are running different versions of
Tally, XML data can be directly imported using the import menu option, without re-formatting.

[Img-35]

Note : D ata store d i n Tall y 7.2 can be e xporte d to Tally 9 or Tal l y.ERP 9. How e ver data
store d i n Tal l y 9 or Tal l y.ERP cannot be e xporte d to Tal l y 7.2.
The e xporte d fil es an any of the se le cte d format are store d i n C :\Tall y.ERP 9 for Wi ndows
XP and C :\Program Fi l es\ Tal l y.ERP9 for Wi ndows 7 ope rati ng

Export Data from Masters - in Tally.ERP 9

With the Export feature of Tally.ERP 9, you can export Tally.ERP 9 data using the available formats. The
exported data can be used by other programs. To export the Masters from Tally.ERP 9 execute the following
steps:

Go to Gateway of Tally > Display > List of Accounts

1. In the List of Accounts screen press E : Export.

2. Select the Language in which you want the data to be exported.

3. Select a format from the list of Formats available.

4. Press Enter to accept the default Output Filename. In case you want to save the file in another
folder then type the desired path and filename.

[Img-36]

5. Accept to export the Masters to a XML format file.

The exported file is saved in the default Tally.ERP9 folder or the specified folder.

Export to Excel - in Tally.ERP 9

Using the Export feature you can export Tally.ERP 9 data to Excel. Data exported to Excel can be e-mailed
as an attachment, used to generate graphs for better presentation and further analysis.

Go to Gateway of Tally > Balance Sheet

1. In the Balance sheet screen click E : Export or press Alt+E.

2. Select the required language from the list of Languages displayed.

3. Select a format from the list of Formats displayed.

4. By default, the exported file will be stored in C:\Program Files\Tally.ERP 9 for Windows
7 and C:\Tally.ERP 9 for Windows XP operating systems

5. Press Enter to accept the default Output Filename or type the filename of your choice in
order to save the file with a different name.

6. Press Enter to accept the default Output Sheet Name.

7. To update the existing file select Yes in Update Existing File.

8. To format the contents of the file select Yes in Excel (Spreadsheet) formatting.

9. Select Yes for the Field with Colour, to retain the background colour in the exported file.

[Img-37]

9. Accept to export the Balance Sheet to an excel file.

The exported file is saved in the default Tally.ERP9 or the specified folder, you can use this file for further
analysis.

Import Data - in Tally.ERP 9

In Tally.ERP 9 you can import data from earlier versions of Tally, Tally.ERP 9 and any third party application
using the predefined format of XML.

To Import Data

 Go to Gateway of Tally > Import of Data

 The Import of Data menu is displayed as shown.

[Img-38]

To read more on the step by step procedure for importing masters, vouchers and synchronization click one
of the corresponding links:

 Masters

 Vouchers

 Synchronization

Import Formats - in Tally.ERP 9

Import Formats

Tally.ERP 9 supports XML format to import data.

[Img-39]

Import Masters - in Tally.ERP 9

To Import Masters execute the following steps:

Go to Gateway of Tally > Import of Data > Masters

1. In the Import of Masters screen:

 Enter the required path and filename in the Import File Name (XML) field. If the file is located in
the default folder, then you need to provide the filename only.

 In the field Treatment of entries already existing select the required Behaviour

 Combine Opening Balances: Select this option to import data of different branches and
consolidate the opening balances. You can also select this option when the opening balances of
existing masters are Zero and need to be overwritten by the balances in the data being
imported.

 Ignore Duplicates Select this option to import new masters along with the existing masters in
Tally ignoring the duplicates.

 Modify with New Data Select this option to replace the existing balances with those existing in
the data imported and also override the other options available in Behaviour list.

[Img-40]

2. Press Enter to Import Masters.

3. Double click on Tally.imp file located in the Tally.ERP folder to view the import log.

Import Vouchers - in Tally.ERP 9

To import vouchers execute the following steps:

Go to Gateway of Tally > Import of Data > Vouchers

1. In the Import of Vouchers screen, enter the required path and filename in the Import File
Name (XML) field.

[Img-41]

2. Press Enter to import the Vouchers

3. Double click on Tally.imp file located in the Tally.ERP 9 folder to view the import log.
ODBC - in Tally.ERP 9
With Open Database Connectivity you can dynamically exchange data between Tally.ERP 9 and any other
application dynamically.

You must ensure that MS-Query is installed on the computer in which you will be installing Tally.ERP 9. This
enables ODBC as soon as Tally.ERP 9 is installed.

The ODBC server is displayed on the information block of the information pane.

To read more on the inward and outward connectivity click on one of the corresponding links below:

 Outward Connectivity

 Inward Connectivity

Outward Connectivity
Using the outward connectivity feature of Tally.ERP 9, you can transfer data between programs without
additional programming. The user can transfer data from Tally.ERP 9 to Microsoft Word or Excel.

Using the Outward Connectivity feature you can:

1.
 Generate Labels from ledger addresses stored in Tally.ERP 9

 Create templates for reports, forms and plug in up-to-date data from Tally.ERP 9.

 Tally.ERP 9 ODBC with Microsoft Excel

Outward Connectivity from Tally.ERP 9

Using the ODBC feature available in Tally.ERP 9 the user can extract the necessary data in Excel and
generate the required reports.

To extract data from Tally.ERP 9 in Excel execute the following steps:

 Start Tally.ERP 9. It should be open till the Mail Merge process is complete.

 Ensure that the words ODBC Server is visible in the Information

Panel under Configuration section of Tally.ERP 9 screen.

 Open Excel sheet

 Go to Data > From Other Sources > From Microsoft Query (Import data for an unlisted
format by using the Microsoft Query Wizard)
[Img-52]

 Choose the Tally.ERP 9 Source (Example: TallyODBC 9000*)

 Click OK

[Img-53]

The screen displayed above appears when Tally.ERP 9 exe is 32 Bit.

Note: If Tal l y.ERP 9 - 64 Bi t , the scree n appe ars as show n be l ow : O bse rve that
the DSN ( Data Source Name ) sel ecte d is Tal l yO DBC64_9000 , w he re 9000 i s the OD BC
Se rve r port numbe r.
[Img-54]

 The Query Wizard window opens

 Select Ledger

[Img-55]

 Expand the list under Ledger and select the required fields and move the required fields to
the right side
[Img-56]

 Click Next

[Img-57]

 Map the Parent as Sundry Debtors (if only Sundry debtors are required) or Sundry
Creditor (if only Sundry Creditors are required) or select both one by one, based on the
requirement.
[Img-58]

 Click Next

 If any sorting is required select the sorting

 Click Next

 Click on Save Query

 Save the Query in a particular path (Eg. C:\Documents and Settings\User\Application

Data\Microsoft\Queries\Query from TallyODBC_9000.dqy)

 Click on Finish

[Img-59]
 The customer data can also be seen in the Excel sheet.

 Click OK in the Import Data window to import the data to Excel

[Img-60]

 Press OK

[Img-61]

Exceptional cases for 64 Bit compatible scenarios

There are three important elements whose bitness determine the Export via ODBC process:

 Tally.ERP 9,

 Operating System, and

 MS Office

The ODBC feature works seamlessly when, the Operating System, Tally.ERP 9 and MS Office are all 64-bit. The
method for this is as shown above.

However, there is a driver requirement if, the Operating System is 64 Bit, while

 Tally.ERP 9 is 32 bit and MS Office is 64-bit.

 Tally.ERP 9 is 64 bit and MS Office is 32-bit.

As can be seen, in both cases there is a bitness mismatch between Tally.ERP 9 and MS Office. Due to this,
Tally.ERP 9 (which acts as the ODBC Server) will not be able to communicate with MS Excel and hence data
will not be exported.

Now, to enable data export, a driver is to be installed.

In the first scenario, to export data via ODBC,

o Open the Tally Application folder.

o Select the tool regodbc64.exe and Run as Administrator. This will install the
driver tallywin64.dat

In the second scenario,

o Select the tool regodbc32.exe and Run as Administrator. This will install the
driver tallywin32.dat

To summarise,

Tally.ERP 9 Operating System 64 Bit

Bitness

MS Office 32 Bit MS Office 64 Bit

32 Bit Works seamlessly without driver Driver to be Installed: tallywin64.dat

installation
To install, select the
tool regodbc64.exe and Run as Admin
64 Bit Driver to be Installed: tallywin32.dat Works seamlessly without driver
installation
To install, select the
tool regodbc32.exe and Run as Admin

[Img-62]

Once the driver has been installed, you can continue with the export process in MS Excel.

Indward Connectivity
Inward connectivity integrates data from other systems with Tally.ERP 9. With this feature you can use data
from other systems in Tally.ERP 9 by creating an integrated system.

For example, a customer contact management program containing details like status of an order and last
contact made can be brought into Tally.ERP 9 and merged into a report containing outstanding balances.
Changes made to the data are immediately reflected in Tally.ERP 9.

To connect to other programs and use external data in Tally.ERP 9, you can contact the nearest Tally
Offices or send an email to support@tallysolutions.com.
Printing Company Logos On Reports And Invoices
Did you know that you can now print your company’s logo on all your reports and invoices
generated by the Tally.ERP 9 system?

Whom do you think customers trust more or rate higher on credibility—a vendor
who hands over an invoice to you with the company logo on it or one who prints an
invoice on a plain sheet of paper?
The answer is, of course, the former. If you thought printing such customised
invoices and reports meant the additional expense of getting stationery printed with your
company logo, you can relax! If you have installed Tally.ERP 9 A Release 3.0 or later,
you can print your company’s logo on plain paper as this version supports image printing.
The logo images should be stored in .bmp, .jpg or .jpeg image formats.
By using the image printing feature, you can now create exclusive reports and
documents with your company’s logo, which will add to their value and render a unique
identity to each official document.

To configure the logo printing function:

• Go to ‘Gateway of Tally > F11: Features > Accounting Features’.
• Set the option ‘Enable Company Logo’ to ‘Yes’.

Enabling the printing of the company logo

Then the location of the logo needs to be entered in the ‘Company Logo Path’ screen.
Path for ‘logo location’ search

Enter the details of the sale in the relevant voucher. Then give the command ‘Alt + P’ to
enable printing.

The command to print the voucher

When the ‘Command to Print’ is given as ‘Yes’, thenthe invoice is printed.

An Invoice with a logo ready for printing

Let us see another example of a Pay slip with a logo:

As of now, the logo can be printed on the following documents:
• Sales invoice
• Delivery note/challan
• Debit note
• Credit note
• Outstanding receivables
• Reminder letters
• Pay slips
• Purchase orders
• Receipt vouchers
• Confirmation of accounts notes

To disable logo printing on some of the reports, ensure that the option ‘Print
Company Logo’ is set to ‘No’ in the print configuration. If any logo other than the default
one needs to be printed, provide the required path where the new logo is stored in
‘Location of logo field’.
As you may have noticed, printing logos on business invoices and reports in
Tally.ERP 9 Series A Release 3.0 is a cake walk. It is very simple and can add a touch of
finesse to any outgoing document, besides providing a professional look to your
stationery.
Data Backup - in Tally.ERP 9
Data on the computer is vulnerable to different types of threats and any data lost cannot be recovered.
Hence, there is a need to store data at a different location by taking a backup.

It is advisable to take data backup at frequent intervals as per the policies laid down by the organization and
also ensure that the data backup is secured logically and physically.

Tracking Data Backup

Back up of data can be carried out by executing the following steps:

Go to Gateway of Tally > Press F3: Company Info or Press Alt+F3

1. Select Backup

2. In the Backup Companies on Disk screen, by default the cursor is at Name of Company,
press Backspace to change the Source or the Destination.

 Source – it is the source folder that contains data for which backup has to be taken, by default
it is the Data folder of Tally.ERP 9

 Destination – it is a folder or an external device (pen drive/Portable Hard Disk etc.,) connected
to the same or another computer where the data backup has to be stored.

[Img-1]

3. Select the companies whose backup has to be taken from the List of Companies displayed,
then select End of List to complete the selection or select All Item to backup all the companies available in
the respective data folder.
[Img-2]

4. Accept to continue taking the backup

5. The Backing up Companies screen appears displaying the name of the company being
backed up and the percentage completed.

The backup file TBK900.001 is stored in the specified folder.

If your business uses Tally.Server 9 to maintain data,

 Click on S: Server Data Loc. or press Alt+S

[Img-3]
Note: If the admi ni strator has e nabl e d Securi ty Acce ss, use rs ne e d to provi de the
authori se d Tal l y.NET c re denti al s i n order to acce ss the Se rve r Li st.

 The List of Tally.Server Data Locations is displayed. Select the required location

[Img-4]

 Press Enter and follow the procedure given above

Note : Whi le taking a backup, i f the Li st of Companies contai ns one or more Tal l yVaul te d
compani e s, the n Tall y.ERP 9 al l ow s the use r to sel ect a si ngle

Restoring Backup Data - in Tally.ERP 9

Restore means return to the original, usable and functional condition. The Restore functionality allows you to
restore the data backup taken earlier.

The existing Restore utility is enhanced with an additional capability to restore data backup of multiple
companies taken using the Auto Backup feature. The backup of multiple companies is stored in a single file
named TABK.900 in the user defined path provided while configuring auto backup.

While restoring the auto backup data, Tally.ERP 9 displays the backup version followed by the last update
time. This allows the user to select and restore the latest backup.

The user must ensure the following points before restoring data backup:

1. Do not restore old or irrelevant data.

2. Do not restore data from a damaged media.

3. Do not restore data in the same folder as the existing data, since it may overwrite the existing
data.

To restore the back-up taken on another media, execute the following steps:

Go to Gateway of Tally > Press Alt + F3 or click F3: Cmp Info

The Company Info menu appears

 Select Restore.

The Restore Companies on Disk screen appears, enter the following details

1. Destination – is the path or the folder where data backup needs to be restored.

2. Source – is the folder or path where data backup file or auto backup files for multiple
companies are stored. The path specified can be on the same storage device/external storage
device or a storage device on the network.

Note: The l ast provi de d source and the de sti nati on paths are popul ate d and di spl aye d.

Restore

In the BackUp section

 Select the required company or companies from List of Companies displayed to restore the
data or select All Items to restore data of all the companies available.

[Img-5]

Note: To re store Auto Backup of mul ti ple companies, se le ct End of Li st i n Name of

C om pani es unde r Backup.

6. Accept to continue restoring the data backup.

The Restoring Companies screen displays the status of data being restored.
[Img-6]

Restore Auto Backup

On entering the Destination and Source, the Restore Companies on Disk appears as shown

[Img-7]

In the Auto Backup section

 Select the required company or companies from List of Companies displayed.

The List of Auto Backup Versions appears as shown

[Img-8]

 Select the required Version of backup

Similarly, select the required companies from the List of Companies displayed and select the required
backup Version from the List of Auto Backup Versions.

 Select End of List to complete the selection of companies

 Select All Items to restore the latest backup versions of all the available companies

 Accept to restore the auto backup of selected or all companies

The Restoring Companies screen displays the status of data being restored.
[Img-9]

If your business uses Tally.Server 9 to maintain data,

 Click on S: Server Data Loc. or press Alt+S

[Img-10]

Note: If the admi ni strator has e nabl e d Securi ty Acce ss, use rs ne e d to provi de the
authori se d Tal l y.NET cre denti al s i n order to acce ss the Se rve r Li st.

 The List of Tally.Server Data Locations is displayed. Select the destination:

[Img-11]

 Continue with Restoring the required Companies as shown above.

Split Company Data - in Tally.ERP 9
The procedure to split data based on financial years is as follows:

Go to Gateway of Tally > F3: Cmp Info

1. Select Split Company Data.

The Split Company Data menu appears

[Img-13]

2. Select the option Select Company

3. Select the required company whose data has to be split from the List of Companies. Click here to
know how to access Tally.Server 9 data.
4. Enter the required date from which you wish to split in the Split From field.
[Img-14]

Tally.ERP will create two separate companies suffixing each company with the date from which it has been
split.

4. Accept to split the company data.

Tally recommends the Split from date to be based on the existing data. It is recommended that the Split
from date is set as the beginning of the current financial year, even though Tally permits any date.

It is advisable to take a backup of the original data on to another media before splitting the company.

Remove the company which contained three years data as you may accidentally use it for entering the
current data.

The split occurs in a set of two periods. Hence, start to split the company with the latest period. E.g., The
data is stored in the same company for a period of three years commencing rather than storing data in three
separate companies. Initially the user has to split the company for two periods between 01/01/2003 and
31/12/2005 and the other part is split for the remaining period.

Two new companies will be created between the periods 01/01/2003 and 31/12/2004, and 01/01/2005 and
31/12/2005, i.e., the historical data of one or more financial years will be preserved as one company and
your current financial year as the other. There is normally no reason to split the prior years again into
separate companies. Incase you wish to split the data for an earlier period, then repeat the above
mentioned steps.

The user can display or print financial reports such as Trial Balance, Balance Sheet, Profit & Loss, Stock
Summary etc., for each of the companies for the relevant periods and compare them for accuracy.

The user needs to alter the names of the two freshly created companies according to the requirement.
Split Data based on Financial Years - in Tally.ERP 9
Storing data in the same company for a few years has a lot of advantages, even though the data size
increases which in turn affects the overall performance of the computer. Tally.ERP 9 allows the user to split
the data based on financial years which will reduce the volume of the data, thereby reducing the load on the
computer.

When the user splits the data based on different financial years, new companies are created for the
respective split periods and the entire data is retained in the original company.

Important pre-split activity

Before splitting the data the user must ensure that the following precautions are taken, failing which, could
result in mismatched information:

1. All unadjusted Forex Gains/Losses have been fully adjusted by journal entries. Verify that this
item does not appear in the Balance Sheet.

2. There are no Purchase Bills/Sales Bills due. Check the Profit & Loss Account and Inventory
Statements – Purchase/Sales Bills Pending. The user has to account them to the respective
party accounts or to respective Bills Pending Account.

3. Ensure that a backup of the data exists.

Note: For use rs of Sal e s/ Purchase O rde r Proce ssi ng fe ature s: O pe n sal e s/ purchase orde rs
w il l not be carrie d forw ard on spl i tti ng. The use r has to re - e nte r the outstandi ng orde rs
afte r spli tting the company. Si mil arl y data pe rtaini ng to a cost ce ntre i s not carri e d forw ard.

Verify Split Data - in Tally.ERP 9

A utility that has the capability to detect possible errors that occur while splitting the data and also provides
the user with possible solutions.

Developed with an objective to reduce the repeated occurrence of possible errors while splitting the data,
this utility automatically detects possible errors in the data. On detecting these errors the system prompts
the user to rectify them with possible solutions so that the errors will not reoccur in future. Users can opt to
either resolve these errors manually or by using the helper available within this utility.

The Verify Split Data utility detects the possible error for

 Units of Measurement incorrect for the Item

 Cost Centre does not belong to the category

 No Accounting Allocations

 Voucher Totals Do Not Match

 Cost Break-up total does not match

To start the data verification process follow the steps shown:

 Go to Gateway of Tally > F3: Cmp Info > Split Company Data >Verify Company Data

The Data Verification for the selected company appears

[Img-15]

1. Select the required company from the List of Companies

The Possible Error screen appears

[Img-16]

2. Select the required possible error displayed to fix the problem.

Units of Measurement incorrect for the Item

The Units of Measure Incorrect screen appears

[Img-17]

1. Select the required voucher

[Img-18]
3. In the Sales Voucher

 Select End of List

 Re-select the item shown earlier in Name of Item

 Enter the correct amount in the Amount column

 Accept the voucher to resolve the issue

Cost Centre does not belong to the category

In the Possible Errors screen

1. Select Cost Centre does not belong to the Category

The Cost Category Mismatch screen appears

[Img-19]

2. Select the required voucher

3. In the Sales Voucher

 Select End of List

 Select the Cost Centre for the Category correctly

 Accept the voucher to resolve the issue

4. Click Ctrl+L: Helper or press Ctrl+L

5. The Cost Category Mismatch Helper appears

[Img-20]

6. Click A: Auto Fill or press Alt+A to automatically fill in the List of Cost Centres

The cost centres are automatically assigned to the respective vouchers.

No Accounting Allocations

The No Accounting Allocation screen appears as shown:

[Img-21]

1. Select the required voucher

2. The Ledger Alteration screen appears

[Img-22]

3. Set Inventory values are effected to Yes

4. Accept to save the changes made.

Voucher Totals Do Not Match

This error occurs when there is a total mismatch in the debits and credit total for a transactions.

To resolve this error follow the steps shown:

On starting the verification process the Possible Errors screen appears

[Img-23]

1. Select Voucher Total Mismatch

2. The list of vouchers with mismatched voucher totals are displayed

[Img-24]

3. Select the required voucher

4. In the selected voucher screen

o Re-accept all the entries present

o Accept to save the voucher

Cost Break-up total does not match

This error occurs if Cost Centre Allocation Total does not match with the ledger amount Total.

To resolve this error follow the steps shown:

1. Select Cost break-up total does not match

2. The list of vouchers with mismatched cost category allocations are displayed

[Img-25]

3. Select the required voucher

4. In the selected voucher alteration screen

o For the Existing Cost Centre enter the correct amount in the Amount column in Cost
Allocations screen or Create a new Cost Centre and enter the difference amount
inAmount column.
[Img-26]

o Accept the voucher to resolve the issue.

Cost Centres in Tally.ERP 9
A Cost Centre is any unit of an organisation to which transactions (generally, revenue) can be allocated.
When only costs or expenses are allocated to these units, they are referred to as Cost Centres. When profits
are also allocated to these units, they become Profit Centres. You can now obtain a Profit and Loss account
of each such Profit Centre.

Cost Centre in Tally.ERP 9 allows an additional dimension to a transaction where a Ledger account indicates
the nature of the transaction. It does not readily disclose, except in the narration field, which part of the
organisation was involved in the transaction.

With the help of Cost Centres, a transaction can be allocated to it, which would then enable accumulation of
the all transactions for that particular Cost Centre. Tally.ERP 9 gives you the Cost Centre break-up of each
transaction as well as details of transactions for each Cost Centre.

Some examples of Cost Centres are

 Departments of an organisation - Finance, Manufacturing, Marketing, and so on.

 Products of a company.

 Individuals such as Salesman A, Salesman B.

Use of Cost Centres

You can classify Cost Centres, just as how you classify Group/Ledger accounts. You can have Primary Cost
Centres and several levels of Cost Centres under each Primary Cost Centre.

Consider the following example.

Primary Cost Centres - Finance, Manufacturing, Marketing.

Under Marketing, classify the company's sales executives as Cost Centres. This will help you track a sales
executive's performance, in terms of cost and revenue generated.

You will then have the following Cost Centre structure

Primary Cost Centre - Marketing

Under Marketing:

 Salesman A

 Salesman B

 Salesman C

Allocate expenditure incurred on sales by the salesmen, as well as the sales generated by them, directly to
their Cost Centres. The allocation is done at the time of voucher entry. This prevents allocation errors at the
end of the period.

By allocating expenses and sales transactions to the salesmen, you are setting up a valuable information
system that tracks the performance of your salesmen.
Creating a Single Cost Centre in Tally.ERP 9
To create a Cost Centre, set Maintain Cost Centres to Yes in F11: Accounting Features. For parallel
allocation of Cost, you can set More than ONE Payroll/Cost Category to Yes.

By default, Tally.ERP 9 activates the Cost Centre feature for Ledger accounts under Sales
Accounts, Purchase Accounts, Expense and Income groups.

Go to Gateway of Tally> Accounts Info.> Cost Centres> Create (Single Cost Centre)

The Cost Centre Creation screen is displayed as shown.

[Img-1]

A brief explanation on each of the fields in the Cost Centre Creation screen follows.

Name

Enter the name of the Cost Centre in this field. For example, Name, function, activity, department, task and
so on.

alias

Enter an alternative name, if required. For example, a short name or a code number

Under

Select the parent Cost Centre under which the Cost Centre is grouped or created from the List of Cost
Centres. If you want the Cost Centre to be a Primary Cost Centre, select Primary from the list.

Provide Bank Details?

The user can specify transaction details for a particular Cost Centre, then this option can be enabled and
relevant details entered in the Bank Details screen. Set this option to No for the Cost Centre Accts.

E-Mail

If required, E-Mail ID can be specified in this field

Refer Creating Cost Centres for Job Costing for details on using Cost Centres for Job Costing.
Note: Unl i ke Groups, you can all ocate transacti ons to Pri mary Cost Centres . How e ve r, you
shoul d do so w he n you do not have Sub Cost Ce ntre s unde r the Pri mary Cost Centr e .

Displaying a Single Cost Centre

To display the details of Cost Centre masters

Go to Gateway of Tally > Accounts Info. > Cost Centres > Display (under Single Cost Centre)

The Cost Centre Display screen appears. It is not possible to make any modifications to the Cost Centre
master in the Display mode. You can only view the details in this mode.

Altering a Cost Centre in Tally.ERP 9

To alter an existing Cost Centre

Go to Gateway of Tally> Accounts Info.> Cost Centres> Alter (under Single Cost Centre)

The Cost Centre Alteration displays,

[Img-2]

Make the necessary changes and Accept to save.

Deleting a Cost Centre

You can delete a Cost Centre from the Cost Centre Alteration screen by pressing ALT+D.

You can delete a Cost Centre only if

 It does not have any Cost Centres created under it.

 It is not used in any transactions.

Explanation of Buttons for Cost Centres in Single Mode

Groups, Ledgers, Voucher Types

It enables you to switch to these areas without having to quit from the current screen.

F11: Features
To change company features. For more information refer F11: Features in Tally.ERP 9.

F12: Configure

To change the configuration of master information. For more information refer F12: Configurations in
Tally.ERP 9.

Note: F12: C onf i gurati on change s affe ct all compani e s i n the data di rectory,
w he re as F11: Features change s affe ct the curre nt company onl y.

Creating Multiple Cost Centres in Tally.ERP 9

You can create multiple Cost Centres in this mode.

Go to Gateway of Tally> Accounts Info.> Cost Centres> Create (under Multiple Ledgers)

The Multi Cost Centre Creation screen is displayed as shown.

[Img-3]

A brief explanation on each of the fields in the Multi Cost Centre Creation screen follows.

Under Cost Centre

Select a particular Cost Centre as the parent Cost Centre, to create cost centres under it. If you wish to
create cost centres under different Cost Centres, select All Items and specify the relevant cost centres in the
Under field.

Name of Cost Centre

Enter the name of the Cost Centre to be created.

Under

The Parent Cost Centre selected in the Under Cost Centre field displays automatically in the Under field for
Cost Centres created newly. If All Items is selected in the Under Cost Centre field, you have the option of
selecting the Cost Centre from the List of Cost Centres.
Displaying Cost Centres in Multiple Mode

You can display the details of multiple Cost Centres at a time in this mode.

Go to Gateway of Tally> Accounts Info.> Cost Centres> Display (under Multiple Cost Centres)

Select a Cost Centre or All Items to display the details of all the Cost Centres under it. Alteration of Cost
Centres will not be possible in Display mode.

Note : The ali as opti on wi ll not be avail able i n Multipl e Cost Centre Creati on mode .
How e ve r, you can spe ci fy al i ases to Cost Ce ntres by se le cting e ach cost ce ntre.

Altering Cost Centres in Multiple Mode in Tally.ERP 9

You can alter multiple Cost Centres at a time in this mode.

Go to Gateway of Tally > Accounts Info.> Cost Centres > Alter (under Multiple Cost Centres)

[Img-4]

Use <backspace> to move back to the field Under Cost Centre or use the button F4: Parent to change
parent Cost Centre. Make the necessary changes in the respective fields and Accept to save.

Note: You cannot del ete a Cost Ce ntre i n multi pl e mode

Explanation on Buttons in Multiple Mode

F4: Parent

It is used to move the cursor to the field Under Cost Centre.

Ctrl + F4: New Parent

It is used to bring up the list of Cost Centres, to select a new parent Cost Centre.

F6: Skip Name/Edit Name

It is used for faster data entry when you need to alter only the Category and the Parent Cost Centre, but not
the names. While skipping names, you might change the Category or the parent Cost Centre to one, which
belongs to another Category, in such instances Tally.ERP 9 displays an error message at the time of
accepting the screen.
F7: Skip Parent/Edit Parent

It is used for quicker data entry, when you do not need to alter the parent Cost Centres but only the name
of the Cost Centre. While skipping Parent Cost Centres, you might change the Category or the Cost Centres
names, in such instances Tally.ERP 9 displays an error message at the time of accepting the screen.

Groups, Ledgers, Cst Cat:

It enables you to switch to these areas without having to quit from the current screen.

F11: Features:

To change Company features. For more information refer F11: Features in Tally.ERP 9.

Cost Categories in Tally.ERP 9

Cost Categories are useful for organisations that require allocation of Revenue and Non-Revenue Items to
parallel sets of Cost Centres. Cost categories facilitate third dimensional reporting of Expenditure and
revenue. Some of the examples of Cost Categories can be Regionwise or geographywise, Gradewise,
Departmentwise and so on.

Use of Cost Categories

By using Cost Categories you may allocate, in parallel, a transaction to more than one set of Cost Centres.
The following example illustrates the use of Cost Categories.

The Cost Centres such as Marketing, Finance and Manufacturing can now belong to a category -
Departments.

The Salesmen A, B and C can be Cost Centres under a Category - Executives.

Similarly, you can create a new Cost Category Projects under which Cost Centres such as Airport
construction, Road construction and Buildings may be created. The classification appears as following:

Cost
Departments Executives Projects
Categories
Airport
Marketing Salesman A
Construction
Cost
Road
Centres Manufacturing Salesman B
Construction
Finance Salesman C Buildings

Specify a Cost Category to allow allocation of only revenue items or items of both revenue and capital
(Non-Revenue) nature. Here in this instance, enable Revenue Items and Non-Revenue Items to Yes for
Departments and Projects Categories and only Allow Revenue Items for Executives.

By allocating expenses to parallel Cost Centres under different categories, you are simply assigning the
amounts to them; the amount does not increase. Tally.ERP 9 performs an automatic reconciliation on real-
time basis, saving you the effort of reconciling Ledgers and Cost Centres.

Note: Transacti ons are not al l ocate d to Cost Cate gorie s but to Cost Ce ntre s only.

Creating a Single Cost Category in Tally.ERP 9

To create a Cost Category, set Maintain Cost Centres to Yes in F11: Accounting Features and then set
More than ONE Payroll/Cost Category to Yes.

[Img-5]

This option is by default, set to No. When this option is set to Yes, Tally.ERP 9 creates a single Cost
Category called Primary Cost Category automatically and allows creation of Cost Centres under the
Primary Cost Category. However, you may also create new Cost Categories or alter existing Cost Categories.

To create a Cost Category

Go to Gateway of Tally > Accounts Info. > Cost Categories > Create (under Single Cost Category)

The Cost Category Creation screen is displayed as shown.

[Img-6]

A brief description on each of the fields in the Cost Category Creation screen follows.

Name

Enter the name of the Cost Category.

Note: The re is no sub - cl assi fi cati on of Cost Cate gori es and he nce you do not fi nd
an Under opti on. Though, the re i s a Pri mary Cost Category , i t i s not a parent of othe r
cate gorie s.
(alias)

Enter an alias, if you wish to call the Category by another name or even by a code number. This field
displays only if you set Allow ADVANCED entries in Masters in Gateway of Tally >F12: Configure> Accts/Inv
Info. to Yes.

Allocate Revenue Items

Set this option to Yes, to allocate all sales, purchase, expenses and income related transactions to Cost
Centres created under this Cost Category. However, if you wish to allocate only capital/non-revenue items
to Cost Centres created under this Cost Category, set this option to No.

Allocate Non-Revenue Items

Set this option to Yes, to allocate transactions related to capital or non-revenue nature to Cost Centres
created under this Cost Category. By default, this option is set to No.

Note: Enabl e ei the r Revenue or Non-Revenue items , or both. D o not di sabl e both.
Tall y.ERP 9 se ts Yes, by d e faul t, for Re ve nue i te ms and No for Non - Re ve nue i te ms.

Displaying a Single Cost Category

To view the details of the selected Cost Category masters from this mode

Go to Gateway of Tally> Accounts Info.> Cost Categories> Display (under Single Cost Category)

 Select a Cost Category from the List of Categories. The Cost Category Display screen is
displayed.

You cannot make any changes to the fields in the Display mode.

Altering a Cost Category in Tally.ERP 9

To alter an existing Cost Category

Go to Gateway of Tally> Accounts Info.> Cost Categories> Alter (under Single Cost Category)

Select the Cost Category from the List of Categories. The Cost Category Alteration screen displays. Make the
changes in the required fields and Accept to save.

Deleting a Cost Category

You may delete a Cost Category that does not have any cost centre under it from the Cost Category
Alteration screen. Use ALT+D to delete it. Tally.ERP 9 does not allow deletion of a Cost Category that has
Cost Centres.

Buttons in Single Cost Category screens

Groups, Ledgers, Cst Ctr, Vch Types

It enables you to switch to these areas without having to quit from the current screen.

F11: Features

To change company features. A detailed explanation on features has been given in the earlier section under
Gateway of Tally.

Note: F12: C onfi gurati on change s affe ct all compani e s, w he re as F11: Features change s
affe ct onl y the curre nt company.

Creating Multiple Cost Categories in Tally.ERP 9

You can create multiple Cost Categories at a time using the multiple mode.

Go to Gateway of Tally > Accounts Info. > Cost Categories > Create (under Multiple Cost
categories)

The Multi Cost Category Creation screen is displayed as shown:

[Img-7]

An explanation on each of the fields in Multi Cost Category Creation screen follows.

S. No.

This is an auto-generated serial number.

Name of Category

Enter the name of the Cost Category.

Allocations for

The Allocations for column is divided into two options, Revenue Items and Non-Revenue Items.

Revenue Items

This is set to Yes, by default. However, you have the option of altering it. This denotes whether you want to
allocate revenue items to Cost Centres created under the Cost Category.
Non-revenue Items

This option is set to No, by default. You can set it to Yes, if you wish to allocate Non-Revenue or Capital
items to Cost Centres created under the Cost Category.

Note: The re is no Unde r fie l d as you cannot sub -cl assi fy Cost Cate gorie s. Cost Cate gorie s
have Cost Ce ntre s as thei r sub - cl assi fi cati on.

Displaying Cost Categories in multiple mode

You can display multiple Cost Categories at a time in this mode. To display Cost Categories in the multiple
mode

Go to Gateway of Tally> Accounts Info.> Cost Categories > Display (under Multiple Cost
Categories)

The Multi Cost Category Display screen is displayed. View the details of all the Cost Categories created. It
is not possible to make any changes in display mode.

Altering Cost Categories in multiple mode in Tally.ERP

9
You can alter multiple Cost Categories at a time in this mode. To alter Cost Categories in the multiple mode

Go to Gateway of Tally> Accounts Info.> Cost Categories > Alter (under Multiple Cost Categories)

The Multi Cost Category Alteration screen displays. Make the necessary changes and Accept to save.

[Img-8]

Note: You wi ll not be able to de l e te a Cost Cate gory in mul ti pl e mode .

Buttons in Single Multiple Cost Category screens

F6: Skip names

It is used for quicker data entry when you need to alter only the Allocation details and not the names of the
Cost Categories.

F8: Skip Details

It is used for faster data entry when you do not need to alter the Allocation (Revenue and Non- revenue)
details. You need to give only the names and the default allocations of Yes for Revenue and No for Non-
revenue display automatically when you are creating Cost Categories. If you are in Alter mode, the
allocations that you opted for when creating the Categories are retained.

Groups, Ledgers, Cst Ctr

It enables you to switch to these areas, without having to quit from the current screen.

F11: Features

It is used to change company features. For more information refer F11: Features in Tally.ERP 9.

Note: F12: C on fi gurati on change s affe ct all compani e s, w he re as F11: Features change s
affe ct onl y the curre nt company.

Creating Cost Centres under Cost Categories in

Tally.ERP 9
To create a Cost Centre under a Cost Category, set More than ONE Payroll/Cost
Category to Yes in F11: Accounting Features

Go to Gateway of Tally > Accounts Info. > Cost Centre > Create (under Single Cost Centres)

[Img-9]

Under Cost Centre

Select a particular Cost Centre as the parent cost center, if you wish to create multiple cost centres under it.

[Img-11]

Name of Cost Centre

Enter the name of the new cost centre. The alias facility is not available in this mode. Select single alter to
give aliases to Cost Centres created in multiple mode.

Under

Select the parent Cost Centre from the List of Cost Centres. The list displays only the Cost Centres that
belong to the selected Category.

Displaying and Altering Cost Centres under Cost Categories in Multiple mode is similar to Displaying and
Altering Cost Centres in Multiple mode explained in the respective chapters. The only additional field is
Category.

Error in Categorisation of Cost Centres:

PARENT BELONGS TO ANOTHER CATEGORY!

This error occurs when you try to assign a cost centre to a parent cost centre belonging to a different
category. In most places, Tally.ERP 9 prevents you from making this error, by not displaying a cost centre
belonging to a different category.

However, this action is not possible when you are altering a cost centre in multiple mode, selecting All Items
in Under Cost Centre field. (You may have chosen to skip either or both).

You would have changed the Category without changing the name and the parent. However, Tally.ERP 9
will prompt for this error only at the time of accepting the screen.

Set up Required for Cost Centre Class in Tally.ERP 9

Before you select classes, it is advisable to create the cost centre structure.

Define the Classes required and indicate which cost centres will be affected for each class. For example,
you might have the following structure:

Divisions
1. Export

2. Wholesale

3. Retail

Departments
1. Finance

2. Marketing

Where Divisions and Departments are Cost Categories and the others are cost centres.

Now, you would like to allocate sales to the following Cost Centre Classes:

1. Export Class - to allocate 100% of Export sales to the cost centre Export

2. Wholesale Class - to allocate 100% of wholesale sales to the cost centre Wholesale

3. Retail Class - to allocate 100% of retail sales to the cost centre Retail

You would also like to allocate all the sales (Export, Wholesale and Retail) to the Marketing Department.

Along with the above mentioned, you would also like to allocate Marketing Expenses on a pro-rata in the
following manner:

1. Finance – 50%

2. Marketing – 50%
With this structure, let us now set up the classes.

Set up Cost Centre Classes

Go to Gateway of Tally > select F11: F1: Accounting Features

Set Use Pre-defined Cost Centre Allocations during Entry to Yes

[Img-78]

(The other options can remain as previously set and are not discussed here.)

Click on Enter, which will pop up Auto Cost Allocations-Cost Centre Classes creation screen. Type the
Class name and select the Categories and the respective cost centres. Specify the percentage of
allocation. After entry, your auto-cost allocation screen will be displayed as shown:
[Img-79]

You have created the Cost Centre Classes as Export, Wholesale, Retail and Marketing Expenses. Divisions
and Departments are cost categories. Export, Wholesale and Retail are cost centres under Divisions.
Marketing and Finance are cost centres under Departments.

It is not necessary to have the same names for the classes and the cost centres, as shown in the above
example.

Using Cost Categories and Cost Centres' in Tally.ERP 9

Cost Centers can be allocated in the vouchers. Activate Cost Centre for the Ledger Accounts
that are used in voucher entry.

Note: Activate Maintain Cost Centers and More than one payroll / Cost
Category in F11:Features > F1:Accounting Features.
[Img-18]

Applying Cost Centres to Ledger Accounts

Example: enable Cost Center for Payment ledger – conveyance account.

Go to Gateway of Tally > Accounts Info > Ledgers > Create/Alter

Set Cost Centres are Applicable to Yes.

[Img-19]

Cost Centre Allocation in Voucher Entry

Cost Centre allocations have to be done in the pop-up sub-screens in the main voucher entry
screen. The sub-screen is displayed after the amount fields pertaining to the ledger for which
cost centers have been activated. Hence, the following is the sub-screen for the ledger
Conveyance A/c.
[Img-20]

The entire objective of creating Cost Centres is to allocate expenses and revenues to Cost
Centres.

After allocating the Cost Centers, the payment voucher entry screen is displayed as shown.
Using Cost Centre Class' in Tally.ERP 9
Each voucher now contains the Cost Centre/Classes option at its head. Select Not Applicable in case
you want to allocate manually. Select a cost Centre class to auto-allocateaccording to the predefined
percentages set in that class.

Let us examine this with two examples, a sales entry and a payment entry.

In sales, let us select Export as the Cost Centre Class.

 Go to the Voucher Entry Screen

 Select F8: Sales

You have the following options:

[Img-22]

Cost Centre Class

Select one of the classes created earlier, in this case Export.

Now enter the sales invoice. The cost centre allocation sub-screen will not be displayed but the allocation
will be done automatically.

After accepting the entry, check the cost centre displays to verify whether the allocation was done correctly.

Similarly, when you press F5: Payment, similar options are displayed. Select Marketing Expenses in that
case. The cost centre allocation sub-screen will not be displayed but the allocation will be done
automatically.

[Img-23]

Use PgUp to check the entry in alteration mode. It will display the allocation in the voucher.
[Img-24]

Check the cost centre reports for allocation.

Note: You can combi ne Voucher Cl ass and Cost centre cl ass to maxi mi ze automati on.

Cost Category Summary in Tally.ERP 9

Cost Category Summary displays the information on all cost categories to which you have allocated the
voucher transactions.

Go to Gateway of Tally > Display > Statements of Accounts > Cost centres > Category Summary
[Img-22]

You can create any number of cost categories apart from the Primary one, which is the default category.
Each Cost Category has cost centres listed under it. The names in italics are cost centres that do not have
any sub-cost centres. The names that are in normal fonts are cost centres that have sub-cost centres
under them.

The debit and credit transaction totals and the closing balance for each cost category are displayed
together with their breakdown consisting of cost centre summaries.

Note: w e can confi gure the re port by se le cti ng the re qui re d opti ons i n F12: Confi gure .

Cost Centre Vouchers in Tally.ERP 9

To display Cost Centre Vouchers,

1. From the Cost Category Summary, drill down into a cost centre for a monthly breakup of
the figures.

2. Select a month to display the Cost Centre Vouchers pertaining to that month.

3. In the Cost Centre Vouchers use F2: Period to expand the date range if required.

4. To display more detailed cost centre vouchers, set the required options in F12: Configure.
[Img-23]

The Cost Centre Vouchers screen is also accessible from all other Cost Centre Reports but the vouchers
displayed are only those that relate to the currently selected cost centre.

Cost Centre Break-up in Tally.ERP 9

Cost centre Break-up shows the ledger accounts that are used in vouchers, the cost centre they were
allocated to, their total transaction values and the balance. If you consider only the revenue accounts, the
Cost Centre break-up becomes the Profit or Loss statement of activities for the cost centre, and hence a
powerful performance statement.

To access the Cost Centre Break-up screen,

1. Go to Gateway of Tally > Display > Statements of Accounts > Cost Centres > Cost
Center Break-up

2. Select a cost centre, e.g. Finance

3. Click F1: Detailed to see the ledgers.

The Breakup of Cost Centre report will be displayed as shown.

[Img-24]

Use the button F5:Led-wise on the button bar to view the report in the alphabetic order of ledger
accounts.

A columnar Cost-centre breakup enables comparison of two or more cost centres and assessment of
their relative performance. Use New Column (Alt+C) to bring up the data of another cost centre for
comparison alongside. Drill down for further details.

[Img-25]
Multi-Currency in Tally.ERP 9
Many Organizations have transactions in more than one currency. Such transactions have to be
recorded either in the base (home) currency or in the foreign currency. If the transactions are
recorded in home currency, the rate at which the foreign currency is exchanged should be
recorded as well. At times you need to record the transaction in the foreign currency itself when
you maintain the balance of the concerned account in foreign currency.

Tally.ERP 9 uses the term base currency for the currency in which your account books are kept.
Foreign Exchange is used interchangeably with foreign currency. The base currency is specified
while creating the company.

Tally.ERP 9 makes it easy to manage multiple currencies, automatic calculations of exchange

rates, automatic conversion of any currency used to record a transaction to the currency of the
account, etc.

The Balance Sheet and Profit & Loss Account of the company is maintained in the base
currency. Conversion of foreign currency account balances is done as per rules set by you.

Go to Company Info. > Create Company

[Img-79]

Note: At ti me of i nstal li ng Tal l y.ERP 9, i f the Country Selecti on i s opte d

as Indi a/Saarc , the C urrency Symbol i s de faul te d as Rs. i n th e Company maste r
othe rwi se i f the Country Se le cti on i s opte d as Internati onal (O thers) , the Currency
Sym bol i s de faul te d as £ in the Company maste r.

Enabling Multi-Currency

Creating a Currency

Altering a Currency

Defining Rates of Exchange

Enabling Multi-Currency in Tally.ERP 9
Enable Multi-Currency feature to view and enter transactions in multiple currencies.

 Go to Gateway of Tally

 Select F11: Accounting Features

 Set Allow Multi-Currency to Yes

 Accept to Save.

[Img-80]

Multi Currency feature is now enabled.

Currencies menu

Once the Multi-Currency feature is enabled in F11: Accounting Features, you can view the Currencies menu
from Gateway of Tally > Accounts Info > Currencies.
Creating a Currency in Tally.ERP 9

To create a foreign currency

1. Go to Gateway of Tally > Accounts Info. > Currencies > Create

[Img-82]

2. Enter the currency symbol in Symbol field. This symbol appears in your reports, wherever
applicable.

Use ASCII Special Characters with [Alt] key combination, if your keyboard does not have the
symbol. Utilities like Character Map (Start > All Programs > Accessories > System Tools) in
Windows, shows the key combination for most symbols. This might be different on some
notebook computers, refer to the computer's user manual or the vendor.

You cannot assign a duplicate currency symbol for a company in Tally.ERP 9.

The Key combinations for a few currency symbols are given below:

 Alt + 156 –Pound Sterling - £

 Alt + 0165 – Japanese Yen - ¥

 Alt + 0128 – Euro - €

 Use the Dollar and the Rs. Symbol from the keyboard

3. Enter the name of the currency in Formal Name. e.g., US Dollars, Pound Sterling, Indian Rupees,
Omani Rial and so on.

A formal name is required to distinguish different currencies with the same symbols. For e.g.
Assume you have created two companies (ABC & XYZ) in Tally.ERP 9. ABC andXYZ have
different set of currencies. ABC uses symbol $ for Australian Dollars and XYZ uses the
symbol $ for U.S. Dollars. The formal name distinguishes two different currencies with the
same symbol, when you compare Books of Accounts of the two companies.

The company that is loaded first retains the original symbol for display purposes. The other
company's currency symbol will be prefixed with the first letter/first few letters (to make it
unique) of the formal name. Here, if ABC is loaded first then the symbol $ is for Australian
Dollars and in XYZ (loaded next) the symbol $ is prefixed with the letter U (first letter of its
formal name).

Note: You cannot assign a duplicate Formal Name for a currency in Tally.ERP 9.

4. Enter the number of decimal places for the currency in Number of Decimal Places. E.g. Currencies with
2 decimal places like paisa and currencies with three decimal places like dinar. There are currencies that do not
have decimal places, e.g., Vietnamese Dong.

5. Tally.ERP 9 has two formats for displaying an amount, viz., in millions and in lakhs. 1000000 (one
followed by six zeroes) in millions format would appear as 1,000,000 and lakhs would appear as 10,00,000.

Select the required parameter in Show Amounts in Millions field. If you select No, the amounts
will appear in Lakhs, by default.

Note: You can always specify the appearance of numbers in specific reports, e.g. In Profit &
Loss Account display, press F12: Configure to change scale factors for values.

6. Set Is Symbol SUFFIXED to Amounts to Yes for the symbol to appear after the amount. Set it to No, for
the symbol to be prefixed to the amount.

7. Set Put a SPACE between Amounts and symbol? to Yes to apply a space between amounts and symbol.

8. Enter the Symbol for Decimal portion of currency in Symbol for Decimal Portion of Amount field. Eg.,
Ps. for Paise.

9. Enter the number of decimal places for printing the amounts in words in Decimal Places for Printing
Amounts in Words field. This number should be equal to or lesser than the number specified in Number of
Decimal Places field.

Note: The Currency cannot be translated or transliterated but will appear in the Language
created.

Buttons available in the Currency creation/alteration screen:

Buttons Keys Description and usage

G: Groups Ctrl+G User is allowed to create Accounting Group from the Currency
Creation/Alteration screen.

L: Ledgers Ctrl+L User is allowed to create Accounting Ledgers from the Currency
Creation/Alteration screen.

S: Cst Cat Ctrl+S User is allowed to create Cost Category from the Currency
Creation/Alteration screen.

C: Cst Ctr Ctrl+C User is allowed to create Cost Centre from the Currency
Creation/Alteration screen.

B: Budget Ctrl+B User is allowed to create Budget from the Currency

Creation/Alteration Screen.

V: Vch Types Ctrl+V User is allowed to create Voucher Type from the Currency
Creation/Alteration screen.
Altering a Currency in Tally.ERP 9
You can modify or delete a currency master using the Alter option. Rates of Exchange can also be
altered from here.

To alter a currency master:

1. Go to Gateway of Tally > Accounts Info. > Currencies > Alter

[Img-83]

2. Select a Currency from the Currencies list (displayed if there is more than 1 currency)

[Img-84]

3. In the Currency Alteration screen, alter details as required. For more information
refer Creating a Currency
[Img-85]

Displaying a Currency

The Currency Display screen displays the details and rates of exchange for a selected currency.

To display the Currency screen:

1. Go to Gateway of Tally > Accounts Info. > Currencies > Display

2. Select a Currency from Currencies list (displayed, if there is more than 1 currency)

3. Enter to view the details

Deleting a Currency

To delete a Currency:

1. Go to Gateway of Tally > Accounts Info. > Currencies > Alter

2. Select a currency from the Currencies list (displayed, if there is more than 1 currency)

3. Press Alt + D in the Currency Alteration screen to delete

Note: You cannot de le te a Curre ncy, i f i t i s use d i n any transacti on.

Defining Rates of Exchange in Tally.ERP 9

In the Rates of Exchange menu, you can specify the rate of foreign currency for a specific date.
Foreign exchange variations occur every day with different selling and buying rates. Rates of Exchange
feature helps you record rate of Currency for particular date and apply in your transactions.

To Display/Alter Rates of Exchange:

Go to Gateway of Tally > Accounts Info > Currencies > Rates of Exchange
[Img-86]

Enter to view the Multi Currency Alteration screen as shown :

[Img-87]

1. Enter the date for which the exchange rate is applicable

2. Enter the Standard Rate (optional) which is used to calculate variances from the actual
transaction rates

3. Enter the Selling Rate (your selling rate)

4. Enter the Buying Rate (your buying rate)

5. Accept to Save

Note: Last Vouche r Rate i s di spl aye d, i f any vouche r has be e n e nte re d e arli e r.

Selling Rate – Specified Rate

Selling rate is your selling rate (as opposed to bank's selling rate) used for receipt voucher entry where
you receive foreign exchange.

This is the rate obtained from your banker or also available in the daily newspaper. Once the Selling
Rate is specified in the Rates of Exchange menu, while entering a foreign exchange transaction, the
rates are defaulted automatically. However, you can alter the rate as required.

The actual rate at which the currency was last used is displayed and cannot be changed.

The specified rate is used for calculating foreign exchange variances only in case where there is no
standard rate.
Buying Rate – Specified Rate

Buying Rate is your buying rate (as opposed to bank's buying rate) used in payment vouchers.

The actual rate at which the currency was last used is displayed and cannot be changed.

The specified rate is used for calculating foreign exchange variances only in case where there is
no standard rate.
Note: Tal l y.ERP 9 automati cal l y cal cul ate s Fore x Gain or Loss for f orei gn exchange
transacti ons usi ng the standard rate s, speci fi e d rate s and actual transacti on rate s
spe ci fi e d in the Rates of Exchange me nu.

Buttons available in the Rates of Exchange screen:

Buttons Keys Description and usage

G :Groups Ctrl+G User is allowed to create Accounting Group from the Rates of
Exchange screen.

L: Ledgers Ctrl+L User is allowed to create Accounting Ledgers from the Rates of
Exchange screen.

S: Cst Cat Ctrl+S User is allowed to create Cost Category from the Rates of
Exchange screen.

C: Cst Ctr Ctrl+C User is allowed to create Cost Centre from the Rates of
Exchange screen.

Using Multi-Currency' in Tally.ERP 9

Tally.ERP9 provides you the facility of entering vouchers in any other currency (Foreign Currency) along
with base currency (specified during Company Creation), i.e., a voucher can be created either with base
currency or with Multi- Currency.

Recording a Purchase voucher with Multi-Currency

To record a purchase voucher using the Multi-Currency feature in Tally.ERP 9,

Go to Gateway of Tally > Accounting Vouchers / Inventory Vouchers > Click F9:
Purchase button or press F9 key

 Select the party ledger in the Party's A/c Name field

 Select the Stock Item in the Name of Item field and enter the quantity

 Specify the price in the currency other than base currency in the Rate field and press Enter
Tally.ERP 9 will automatically prompt you to enter the Rate of Exchange for Base Currency as shown:

[Img-25]

 Enter the rate of exchange and press Enter to navigate to

the Accounting Voucher Creation screen

[Img-26]

 Press Enter to accept

Recording a Sales voucher with Multi-Currency

Go to Gateway of Tally > Accounting Vouchers / Inventory Vouchers > Click F8: Sales button or
press F8 key

 Select the party ledger in the Party's A/c Name field

 Select the Stock Item in the Name of Item field and enter the quantity

 Specify the price in the currency other than base currency in the Rate field and press Enter
 Enter the Rate of Exchange for the base currency and press Enter

[Img-27]

 Press Enter to accept

To print the sales invoice,

 Press Alt+P key or click P: Print button

The Voucher Printing screen appears

 Press F12 key or click F12: Configure button

The Invoice Printing Configuration screen appears

 Set the option Print Base & Foreign Currency for Total to Yes. Enabling this option will
print the Total amount in both Base Currency and the Foreign Currency
[Img-28]

The print preview of Sales Invoice appears as shown:

[Img-29]
Interest Calculation based on Bank Date/Voucher Date
in Tally.ERP 9
The interest calculation feature is enhanced with the facility to calculate interest on ledger balance as per
Bank balance provided in Bank Reconciliation Statement using simple and advanced parameters based on
bank/reconciliation date. However, to allow users to predefine auto-calculation of interest based on
voucher date, the Date Type - Voucher Date is also made available along with Bank/Reconciliation
Date in the bank ledger master.
Note: In al l rele ase s of Tal l y.ERP 9, the i nte re st w as bei ng calculate d , by de faul t,
on Voucher Date . In Tal l y.ERP 9 rel ease 4.8 , the opti on to cal cul ate i nte re st
on Bank/Reconci l i ati on Date has be en provi de d. He nce , onl y the new l y provide d fe ature
w il l be e xpl ai ne d he re .

To capture the transaction details of reconciled vouchers and provide flexibility to drill-down to the last
level of voucher entry, a new report - Bank Reconciled Transactions has been introduced.

The option to calculate interest based on either Bank reconciliation date or voucher date will be displayed
for ledgers grouped under Bank Accounts, Bank OCC A/c and Bank OD A/c. The interest calculated
on:

 Voucher date will be displayed in the Ledger Interest report

 Reconciliation date will be displayed in Bank Reconciled Transactions report.

Bank Master - Interest Calculation on Bank/Reconciliation Date using Simple Parameters

Go to Gateway of Tally > Accounts Info. > Ledger > Create

Ensure the option - use advanced parameters below Activate Interest Calculation of F11:
Features > F1: Accounts is set to No.

Create the ledger Canara Bank A/c by grouping it under Bank Accounts and set the option - Activate
Interest Calculation to Yes.
[Img-40]

In the Interest Parameters screen, select the Bank/Reco Date as the Date Type in the Calculate
Interest Based on field. Provide the other parameters as shown and accept theInterest
Parameters and the bank Ledger Creation screen:

[Img-41]

Bank Master - Interest Calculation on Bank/Reconciliation Date using Advanced

Parameters

In the Ledger Creation screen, click F11: Features > F1: Accounts set the option - use advanced
parameters below Activate Interest Calculation to Yes.

In the Ledger Alteration screen of Canara Bank A/c ledger, set the option - Activate Interest
Calculation to Yes and press Enter key. In the Interest Parameters screen, select theBank/Reco
Date as the Date Type in the Calculate Interest Based on field. Provide the other parameters as
shown and accept the Interest Parameters and the bank Ledger Creation screen:
[Img-42]

Voucher Entry

Let us record payment voucher on 1-5-2013. Go to Gateway of Tally > Accounting Vouchers > F5:
Payment

Recording Payment Voucher in Single Entry Mode

Click F12: Configure and set the option - Use Single Entry mode for Pymt/Rcpt/Contra to Yes and
accept the Voucher Configuration screen. Record the payment voucher and provide the bank details.
[Img-43]
Note: To provi de bank de tai ls w i th re marks, cli ck F12 : Confi gure in the Payme nt voucher
and se t the opti ons as show n:
[Img-44]
The Payment voucher appears as shown:
[Img-45]

Recording payment Voucher in Double Entry Mode

In the Accounting Voucher Creation screen, click F12: Configure and set the option - Use Single Entry
mode for Pymt/Rcpt/Contra to No and accept the Voucher Configurationscreen. Record the
payment voucher and provide bank details.

[Img-46]
The Payment voucher appears as shown:
[Img-47]
Note: To di spl ay D r/ Cr i nste ad of To/ By i n the vouche r, cli ck F12 : Conf i gure and se t the
opti on - Use C r/Dr i nstead of To/By duri ng entry to Yes.

Interest Calculation Report

Since the bank ledger is configured to calculate interest based on reconciliation date, interest will be
calculated only if the transactions are reconciled.

To view the Interest Calculation report, go to Gateway of Tally > Display > Statement of
Accounts > Interest Calculation > Ledger > Canara Bank A/C

Scenario 1: Reconciling the Payment Vouchers and Viewing Interest Calculated on Simple
Parameters

To reconcile the payment voucher, go to Gateway of Tally > Banking > Bank
Reconciliation > Canara Bank A/c

For the payment vouchers recorded in the previous section, enter the reconciliation dates as shown and
accept the Bank Reconciliation screen:
[Img-48]
To view the Interest Calculation report after reconciling the payment vouchers, go to Gateway of
Tally > Display > Statement of Accounts > Interest Calculation > Ledger >Canara Bank A/C

Click F2: Period and enter the From and To dates as 1-5-2013 and 31-5-2013 respectively. The Interest
Ledger report appears as shown:

[Img-49]
Depending on the dates entered for reconciliation, the interest gets calculated and displayed here.
Scenario 2: Reconciling the Payment Vouchers and Viewing Interest Calculated on Advanced
Parameters

In the Interest Calculation report, click F2: Period and enter the From and To dates as 1-5-2013 and
30-6-2013 respectively to view the interest for the period of June as defined in the advanced interest
parameters. The Interest Ledger report appears as shown:

[Img-50]
Depending on the dates entered for reconciliation, the interest gets calculated and displayed here.

Bank Reconciled Transactions

To view the Bank Reconciled Transactions report, press Enter on any one of the balances displayed in
the Ledger Interest report.

(Go to Gateway of Tally > Display > Statement of Accounts > Interest
Calculation > Ledger > Canara Bank A/C > Press Enter on any one of the balances)

Click F2: Period and change the From and To dates as 1-5-2013 to 30-6-2013 respectively.
Click F12: Configure and set the options as shown to choose the required sorting option and capture the
narration, remarks and favouring name in the Bank Reconciled Transactions report:
[Img-51]
The Bank Reconciled Transactions report appears as shown below:

[Img-52]
The Bank Reconciled Transactions report provides columnar details on reconciled transactions. The description of
each column is given below:

Bank Date: The Bank Date provided in the Bank Reconciliation screen is captured here.
Vch Date: The date on which the transaction is recorded is captured here.

Particulars: The remarks and narration entered in the payment/receipt voucher are captured under the name of
the ledger:

 Debited while recording a payment transaction.

 Credited while recording a receipt voucher.

Favouring Name/Received From: The details entered in the Favouring Name/Received From field in the Bank
Allocation screen of payment/receipt voucher is captured here.
Note: To provi de de tail s i n the se fi el d, e n sure the re le vant informati on i s provi de d i n
the Bank Detai l s ( displ aye d on se tti ng the opti on - Provi de Bank Detai l s toYes) i n the
party l e dge r maste r.
Vch Type: The voucher type used to record transaction is captured here.

Transaction Type: The transaction type selected in the Bank Allocations screen of the payment or receipt
voucher is captured here.

Instrument No.: The instrument number entered in the payment or receipt voucher is captured here.

Instrument Date: The instrument date entered in the payment or receipt voucher is captured here.

Debit: The amount debited to the bank ledger in the voucher is captured here.

Credit: The amount credited to the bank ledger in the voucher is captured here.
Interest Calculation in Simple Mode in Tally.ERP 9
To calculate Interest in the Simple Mode:

1. Go to Gateway of Tally> F11: Features> Accounting Features > Set Activate

Interest Calculation to Yes. > Set Use Advanced Parameters to No.

2. In the Ledger Creation screen set Activate Interest Calculation to Yes.

3. The Interest Parameters sub screen is displayed. Enter the Rate and select the interest
style from the list.

Interest calculations on outstanding balances

Enter Interest details in Vouchers (only in case of transaction by transaction/Bill-by-bill) and view
Interest reports.

You will have to alter existing ledger accounts to permit interest calculations on them. The same
operation will apply when creating a new ledger account.

Interest calculation on outstanding balances is allowed for any ledger account. You simply specify the
interest rate and style of calculation. Nothing is required to be done for interest during voucher entry.

Let's take an example: Interest calculated on Outstanding Balances.

1. Go to Gateway of Tally> Accounts Info.> Ledgers> Alter (Single)> XY Bank (bank

account)

2. Set Activate interest Calculation to Yes.

3. On activation, the Interest Parameters must be set. It is the basis on which interest will
be calculated for this Ledger account.

4. Rate: This is the rate at which the interest has to be calculated. In this case, specify 15%.

5. Interest Style: It is the basis on which the rate is applied. Of the four options, select 365-
Day Year.

6. Accept the screen.

You can now view the amount of interest that could be charged by the Bank.

Report on Interest Calculated on outstanding balances

The Interest Calculations Report can be displayed and printed.

Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculations> Ledger>

XY Bank (Bank Account)
Interest calculation transaction by transaction

Activate and specify interest calculations in ledger masters.

Transaction by transaction or Bill-by-Bill interest calculation is permitted for 'Party' accounts like
accounts falling under the groups Sundry Debtors and Sundry Creditors. For example:

1. Alter a Customer account (under the group Sundry Debtors or one of its sub-groups).

2. Set Activate Interest Calculation to Yes. In the Interest Parameters now you have three
lines to answer.

3. Set Calculate Interest Transaction-by-transaction to Yes.

4. Set Over-ride Parameters for each transaction to No.

If set to No, you are not allowed to change interest parameters in voucher/invoice entry. If set to Yes,
you can change the interest parameters during entry.

Report on Interest Calculated on outstanding transactions/bills

To view the Interest calculated

Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculations> Ledger> CP

Ltd

The report is similar to the Bill-wise Outstanding Statement. The last column gives the interest amount
on the transaction. Select the line to be viewed in detail for its calculations.

Interest Calculation in Advance Mode in Tally.ERP 9

The advanced parameters are particularly useful where interest rates change from time to time.

 Go to Gateway of Tally> F11: Features > Accounting Features > Set Activate
Interest Calculation to Yes. > Set Use Advanced Parameters to Yes.

 The Interest Parameters sub-screen is displayed

For Ledgers created under the Group Sundry Debtors/Sundry Creditors, the Interest Parameters
sub-screen is displayed as shown below:
[Img-26]

 Set Calculate Interest Transaction-by-Transaction to Yes, if you want to calculate

interest for each transaction.

 Set Override Parameters for each Transaction to Yes, if you want to override the
interest rates and parameters set here during voucher entry.

 Enter the interest rate in the Rate field.

 Select the interest rate calculation period from the Interest Style list in the Per field.

 Select the choice of balances for which the interest has to be calculated from the Interest
Balances list in the On field. The balances are All Balances, Credit Balances only and Debit
balances only. Interest can be calculated on all outstanding balances, whether debit or
credit. You would like to select only credit balances in case of accounts like Bank accounts,
if you want to know the interest that the bank might charge on overdrawn balances.

 Select the rounding method applicable from the Rounding Methods list. The amount can
be rounded off normally or upward or downward. If you do not want any rounding method,
select Not Applicable.

For Ledgers created under the Group Bank Accounts, or if the option Calculate Interest Transaction
by Transaction is set to No, then the Interest Parameters sub-screen is displayed as shown below.

[Img-27]
Enter the interest rate in the Rate field.

 Select the interest rate calculation period from the Interest Style list in the Per field.

 Specify the interest rate applicable period from the Applicable From: and To: fields.

 Select the rounding method applicable from the Rounding Methods list. The amount can
be rounded off normally or upward or downward. If you do not want any rounding method,
select Not Applicable.

Display Report – Interest on Outstanding Balances

To view the report on Outstanding balances:

Go to Gateway of Tally> Display> Statements of Accounts.> Interest Calculations> Ledgers>

XY Bank

[Img-28]

Advanced Parameters - Interest calculation transaction by transaction

Activate and specify interest calculations in ledger masters.

The following extra options now become available:

 You can now have Multiple Rates of Interest.

 You can Override Advanced Parameters during voucher entry. Hence, each entry could
have different parameters.
 Choice of Balances – All Balances, Credit Balances only, Debit Balances only.

 Applicability - This actually applies to the viewing of the statement and not the levy of
interest.

 Calculate from - You can decide whether interest is to be levied from the Due Date or
from the Effective Date of the transaction (or the voucher date if effective date is not
activated) or even Date ranges specified during Voucher Entry.

 Choice of methods for Rounding off of interest amounts.

[Img-29]

Note: To obtai n the opti on C al cul ate f rom Date Speci f ied during Entry , you must
have O ve rri de advance d parame te rs se t to Ye s. The opti on i s re qui re d i f you w ant to
spe ci fy i nte re st to be calcul ate d at di ffe re nt rate s for di ffe re nt peri ods. If you choose to
ove rri de parame te rs the n i nformati on w oul d be aske d duri ng vouche r/i nvoi ce e ntry. The
i ntere st i nformati on i s re qui re d afte r the bill -w i se detail s have bee n e nte re d.

Report on Interest Calculated on outstanding transactions/bills

Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculations> Ledger> CP

Ltd

Press the button F1: Detailed on the Button bar to see the calculation and the period. Previous
transactions are calculated from Effective date of Transaction as default. Date Specified during Entry
has not been used.
Note: Part moni e s recei ved have be e n accounte d for and i nte re st cal cul ate d on the
bal ance .
[Img-30]

A look at Calculate From Dates Specified during Voucher Entry

You have set up the Interest Parameters for CP Ltd to calculate on Dates specified during Voucher
Entry.

We will take one invoice and put in the interest information.

[Img-31]

To view the interest amount:

Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculations> Ledger>

CP Ltd
[Img-32]

Book Entries and adjustment of interest

We have seen the reports on interest amounts calculated in different ways but these have not been
brought into books! They simply give you the interest implications. You must book them now.

How to enter the calculated interest amounts?

Use Debit Notes and Credit Notes with Voucher Classes

Use Debit notes for Interest receivable and Credit Notes for Interest Payable. Interest is
calculated on Simple or Compound basis and separate classes should be used for them.

Set-up Debit/Credit Note Classes for interest entries

Set up Debit Notes. Credit Notes will behave the same way.

Go to Gateway of Tally> Accounts Info.> Voucher Types> Create/Alter

 Alter the Voucher Type Debit Note.

 Tab down to the field Class.

 Type the name of the Class.

 Type Interest - Simple

[Img-33]

Likewise, create a Class – Compound Interest and set Yes to Amounts to be treated as Compound
Interest.

Accept the Voucher Type and return to the Gateway of Tally. Create a ledger account Interest
Received under Group Indirect Income.
Voucher Entry for booking Interest

1. Go to Gateway of Tally> Accounting Voucher

2. Select Ctrl+F9: Debit Note

3. There are two situations for interest adjustment:-

 Simple Interest – Interest amounts are not debited onto the same bills. Create a
fresh reference for it.

 Compound Interest – Amounts are auto-debited to the selected bills. Bill-wise

details will not appear in this case.

 Interest on balances only

Bill-wise interest entry

 Debit CP Ltd

 Credit Interest Received

When you debit the party account, a list of bills for which interest is applicable pops up. Select the bills
to adjust. Note that even cleared bills appear.

[Img-34]

Select the respective interest bills from the list . The debit amount is filled up with the total. Select New
Ref in the bill-wise allocation. In the interest sub-screen, ensure that the rate of interest is 0.
Now, Credit Interest Received. The amount is already filled in.

Your voucher will resemble the one below:

[Img-35]

Entries for compound interest are exactly the same as for Simple Interest where all you do is select
the Voucher Class Compound Interest. Also the Bill-wise details popup sub-screen does not come up as
the amounts are added onto the bills.

Select the required bill from the list and complete a Debit Note.

Now display Outstandings for CP Ltd

[Img-36]

The Bill reference CP/00466993 is the invoice onto which interest has been compounded.

A new Reference no 2 has been created for Simple Interest due from CP Ltd.

Entries for Interest on Balances only

Again, the issues are Simple and Compound Interest

Compound Interest

Make the following entries in a Debit note with Compound Interest Voucher Class

 Debit Bank Ltd (the amount is automatically filled up with the calculated interest)

 Credit Interest Received

And nothing needs to be done! The Bank Account has been increased by the amount of interest due and
the Income account of Interest Received also credited.

Simple Interest

Make the same entry as above.

However, since it has the effect of increasing the Bank Ltd account with the amount due (compound
effect), you must make a journal entry to reverse it. The reversal entry would be something like this:

 Debit Interest Receivable (a current asset account)

 Credit Bank Ltd

Use a normal Journal voucher for this entry.

We have to necessary go this route to take advantage of the auto filling of the interest amount which
can appear only when we use the Bank Ltd account in Debit Note in the first place.

Interest Calculation Reports in Tally.ERP 9

Interest Calculation reports are automatically produced if the feature is activated In F11: F1: Accounting
Features and the parameters are set for individual ledger accounts.

There are two types of reports, one pertaining to interest on balances of accounts like loans, and the other
interest on overdue invoices.

Interest reports are available for individual ledger accounts as well as for Groups

Interest Calculation on Group in Tally.ERP 9

The Group Interest Calculation statement is a list of all accounts and sub-groups belonging to the selected
group that displays the current balance in each account or sub-group and the total interest.

Go to Gateway of Tally> Display > Statements of Accounts > Interest Calculations > Group

Select a Group, E.g. Loans (Liability)

[Img-37]

The Cr in the interest amount should not be confused to mean an Income. It only means that it is payable and
is a liability.

To ease interest recording, Tally.ERP 9 has an interest template, a special voucher class in Debit
Note and Credit Notes.

Drill down to the Ledger level Interest report.

Interest Calculation on Ledger Balances in Tally.ERP 9

You can get a report on the Ledger balances for the interest calculated.

Go to Gateway of Tally> Display> Statements of Accounts> Interest Calculations> Ledger

Select Account E.g. Bank Loan Account.

Interest is re-calculated with every change in balance outstanding. The Cr in the interest amount should not be
confused to resemble an Income. It only means that it is payable and is a Liability.

To ease interest recording, Tally.ERP 9 has an interest template, a special voucher class in Debit Note and
Credit Notes.

The interest screen will appear similar to the one below:

Interest calculation on Bank Loan account

[Img-38]

Statement of Interest Due on Invoices in Tally.ERP 9

You can calculate interest on each invoice for the period it is outstanding, wholly or partly. Transaction by
transaction or bill-by-bill interest calculation is permitted for 'Party' accounts like accounts falling under the
groups Sundry Debtors and Sundry Creditors. Bill-wise details should be active for the company and the party.

The report is similar to the Bill-wise Outstandings Statement. The last column gives the interest amount on the
transaction. Press F1: Detailed to see the calculation.

Go to Gateway of Tally > Display > Statements of Accounts > Interest Calculations > Ledger

Select the ledger Account XYZ Agency

[Img-39]

Interest is re-calculated with every change in balance outstanding. The Cr in the interest amount should not
be confused to mean an Income. It only means that it is payable and is a liability. The figure is illustrative only
and you will need to account for the interest expense and liability through a journal entry.

To ease interest recording, Tally.ERP 9 has an interest template, a special voucher class in Debit
Note and Credit Notes.
Creating a Budget in Tally.ERP 9
To create a Budget in Tally.ERP 9

Go to Gateway of Tally > Accounts Info > Budgets > Create

1. In the Budget Creation screen enter a Name for your budget.

2. Select from the List of Budgets for Under field. You can have a hierarchical setup for
budgets. In the List of Budgets, Primary is at the top of the hierarchy and you can create
more primary budgets. Sub-budgets can be created under Primary budgets.

3. Enter the period of the budget in the From and To fields. The period entered can be a
month, a year or any other period.

4. In Set/Alter Budgets of, select

• Groups - To create a budget for a Group of ledger accounts.

• Ledgers - To create a budget for Ledgers.

• Cost Centres - To create a budget for Cost Centres.

5. Accept to save.

Altering a Budget in Tally.ERP 9

You can modify a budget, using the alter option.

Go to Gateway of Tally > Accounts Info > Budgets > Alter

1. In the Budget Alteration screen, modify the fields as required. Change the period or
change budgets of Groups, Ledgers and Cost Centres.

[Img-

Note : By de faul t, Se t/ Al te r Budge ts i s se t to No . Se t thi s opti on to Ye s to al ter.

Deleting a Budget

To delete a budget:

Go to Gateway of Tally > Accounts Info > Budgets > Alter

 Press Alt+D.

Creating Budget for Groups in Tally.ERP 9

In the Budget Creation/Alteration screen, set Yes in the Groups field, to set budgets for a group or
group of ledgers.

[iMG-15]

In the Group Budget screen, select a Group from the List of Groups and enter Account Name.

Enter the cost centre for a group in Cost Centres field, select Not Applicable, if the budget is not for
a particular cost center.
[iMG-16]

In Type of Budget, select from the following two types.

1. On Nett Transactions

Select this option to monitor the transaction amounts and not the balances. Nett is net of debits and
credits for the specified period. Nett transactions Budgets specified for a period automatically gets
apportioned over the period. i.e., When On Nett transactions Budgets are defined, the debit amount for
the specified period after reducing the credits for the same period is considered without taking into
account opening and closing balances. For example to compare transactions against budgets, especially
revenue income and expenses On Nett Transactions can be selected.

2. On Closing Balance

Select this option to monitor the balances of the Accounts and the not the transactions. i.e., each
month will have the same budget value except that the actual Opening Balance is also taken into
account. Budgets on Closing balances can be set for Bank Account Ledgers, Debtors Ledger balances
and so on. For example to compare closing balance figures in final statements, especially Balance Sheet
items like assets and liabilities, select Closing Balances.

Enter the budget amount in the Amount field.

[iMG-17]
Note : Group Budgets do not ge t apporti one d w he reas Ledger Budgets ge t
apporti one d for e ach month.

Creating Budget for Ledger Accounts in Tally.ERP 9

In the Budget Creation/Alteration screen, set Yes in the Ledgers field, to set budgets for ledgers.

[Img-18]

In the Ledger Budget screen, select a Ledger from the List of Ledgers and enter Account Name.

[Img-19]

Budgets can also be defined for Cost Centres pertaining to Ledger Accounts wherein you can repeat
the same ledger with another Cost Centre.

Enter the cost centre for the Ledger Account in the Cost Centre field. Select Not Applicable if the
budget is not for a particular cost centre, but for the company.

[Img-20]

In Type of Budget, select from the following two types.

1. On Nett Transactions

2. On Closing Balance

Enter the budget amount in the Amount field.

[Img-21]
Note : Le dge r Budge ts get apporti one d for e ach month.

Creating Budgets for Cost Centres in Tally.ERP 9

The purpose of a budget is to control expenditure. You can create multiple budgets in Tally.ERP 9, each
for a specific purpose such as for the Bank, for the Head Office, Marketing budgets, Finance budgets,
and so on.

1. In the Cost Centres field in the Budget Creation/Alteration screen, set Yes to set
budgets for cost centres.

[Img-22]

2. In the Cost Centre Budget screen, select a Cost Centre from the List of Cost Centres and
enter Cost Centre.
3. Enter a budget figure in Expenses for the cost centre.

4. Enter a budget figure in Income for the cost centre.

5. Enter Closing Balance.

6. Accept to save.

[Img-23]

Viewing Budget Variance in Tally.ERP 9

Budget Variance report can be viewed from Trial Balance, Group Summary, monthly summary etc.
The Budget Variance button (Alt+B) is active, if Budgets feature is enabled and at least one budget
created. Budget Variance displays Budgets, Actuals with percentage and Variance from the budget
with percentage.

1. Budget Variance can be accessed from:

 Gateway of Tally > Display > Trial Balance to display the Trial
Balance screen.

 Gateway of Tally > Display > Account Books > Group Summary and select a
group from List of Groups to display the Group Summary screen.

2. Click on Budget Variance (Alt+B) from the toolbar to display the Budget
Analysis screen.
[Img-24]

4. Select from the List of Budgets for Budgets/Scenario.

5. Three columns display Budget, Actuals and Budget Variance, respectively.

Note : Use C ol um n functional ity to add/ remove col umns for Multi -peri od or Mul ti -
budget C om parati ve Variance report .

[Img-25]

Corporate budget Column displays the values of the Budget, which is defined.
Actuals Column displays the value of Actual Expenditure incurred.

Corporate Budget Variance displays the values of the Variance of the Actuals and Budgets. i.e.,
Budgets – Actuals = Variance .
Note: If the Budget Vari ance show s the negati ve val ue , the n the actual e xpendi ture
val ue has e xcee de d the Budge te d val ue s.
Scenario Management in Tally.ERP 9
Scenario management is a management tool that enables different displays of accounts and inventory
related information, by selectively including certain types of vouchers without affecting the source data.
It is useful in generating provisional reports, where entries are not actually made in the main books. It is
also a useful forecasting tool i.e. you can forecast the expenses using provisional Vouchers and include
them in your reports.

The vouchers that are used in Scenario Management are:

 Optional Vouchers

 Memorandum Vouchers

 Reversing Journals

This section shows you how to use the above-mentioned vouchers in Reports. You can create a number
of scenarios each including and/or excluding one or more types of voucher entry.

Create a Scenario

Alter or Display Scenario Information

Using Reversing Journals in Scenarios

Using Scenarios in Statements and Reports

Creating a Scenario in Tally.ERP 9

Set Use Reversing Journals & Optional Vouchers in F11:F1: Accounting Features to Yes.

Go to Gateway of Tally > Accounts Info. > Scenario > Create

[Img-109]

1. Give a suitable name to the scenario. In this case, it is Provisional.

2. Set Include Actuals to Yes

3. Set Exclude Forex Gains/Losses Calculations to Yes if you do not want the Unadjusted
Forex Gain/Loss element to appear in the scenario

4. Set Exclude Inventory Tracking Calculations to Yes if you do not want the
Sales/Purchase Bills Pending element to appear in the scenario

5. Include - From the list of vouchers, include the type of vouchers required. Notice that it
picks up the Voucher Types created for this company. Provisional Vouchers and Regular
vouchers that are marked Optional are permitted for selection.

6. Exclude - Exclude from the list of vouchers already included in the type of vouchers that
you do not want to affect this scenario. This option is used in Alter mode and hence is
discussed under Alter/Display Scenario Information.

7. Accept to create this scenario.

Altering a Scenario in Tally.ERP 9
Go to Gateway of Tally > Accounts Info > Scenario > Alter

 Select the scenario to alter from the List of Scenarios

The information given while creating the scenario displays and you can alter it.

Exclude

Use the Alter mode, when you do not want a selected included voucher to affect the scenario,
anymore. It is easier to put the selected voucher in the Exclude List, rather than to remove it from the
Include List.

Using Reversing Journals in Scenarios in Tally.ERP 9

Create a Reversing Journal Entry for the scenario as follows.

Go to Gateway of Tally > Accounting Vouchers > F10: Rev Jrnl

1. Select Reversing Journals from the list.

2. Debit Depreciation and enter the amount

3. Credit Provision for Depreciation

[Img-110]

4. Enter Narration if any.

5. Accept the Voucher.

Display/Alter a Reversing Journal

Using Scenarios in Statements and Reports

Display / Alter Reversing Journals in Tally.ERP 9

View or alter the reversing journal through the Reversing Journals Book under Exceptional
Reports.

Go to Gateway of Tally > Display > Exception Reports > Reversing Journals

1. Select a month to list all the reversing journals for that month. Drill-down to view/alter
the entry.

Using Scenarios in Statements and Reports in

Tally.ERP 9
You can use scenarios in statements (not registers) that have the New Column button active.

1. Display the Balance Sheet.

2. Select New Column.

3. In the column details, tab down to Types of Values to Show.

4. Select the scenario named Provisional.

The Balance sheet displays as shown with two columns for the same date.
[Img-111]
Note: the Provi si on for Depre ci ati on fi gure s in both the col umns. The actual column
show s 18250 w hil e the Provi si onal column show s 33250. Thi s is on account of the
re ve rsi ng journal e ntry i n the Sce nari o. To vie w , go through the Exce pti onal Reports
D i spl ay Me nu.

Use the same procedure to create another scenario for Sales Forecasts.

1. Create a new Scenario and call it Sales Forecasts.

2. Include Sales Vouchers Optional Only.

3. Create 12 Sales Vouchers, one in each month. Remember to mark them Optional.

4. View the Sales Accounts by drilling-down the Profit & Loss A/c.

5. Bring up New Columns and limit each column date range to the following month.

The Sales forecast figures must display.

Note: You coul d e ve n use Memorandum Vouchers for thi s purpose , instead of
the O pti onal vouchers. Memorandum Vouchers i s di scusse d i n the ne xt se ction.
Banking In Tally.Erp9
Attitude Academy
Intro of Banking

• All businesses need to connect with their

banks. Today, even small businesses will
have thousands of banking transactions
per month and these are usually carried
out on a daily basis. Tally.ERP 9 ensures
a seamless banking experience.
The banking feature of Tally.ERP 9 gets all
bank - related chores to your fingertips.
Cheque Management
You get to maintain multiple cheque books with
cheque range and use it to auto-increment cheque
number during voucher entry. This, along with
duplicate cheque number validation, will reduce
manual error and increase the speed of data
entry. Other than this, you also get to manage
cheques through their life-cycle - from issue to
reconciliation - with the help of the cheque register.
This is that feature which shows the status of all
cheques, along with a quick search for instant
validation. You also have other conveniences like
issuing blank cheque and cheque cancellation.
Cheque Printing

• It is not just cheque management, you can

also print your cheques without doing any
manual configuration. Simply select your
cheque format by viewing its image and
print. Its that simple! There are more than
350 cheque formats that are currently
available.
Payment Advice Printing

• A system-generated payment advice

(covering letter for payments) can be
printed for both single and multiple
vouchers.
Printing Deposit Slips

• Deposit slips can be printed for cash

or for single/multiple cheques.
Benefits
• Saves time
• Reduces errors
• Simplifies banking
• Improves productivity
• Improves traceability
Banking - in Tally.ERP 9
Banking Module has been enhanced in Tally.ERP 9 to simplify the overall banking experience. A separate
menu Banking has been provided under Utilities in the Gateway of Tally. The user need not go to different menus
to operate the banking related operations in Tally.ERP 9, such as Printing Cheques (pre-Configured), BRS (Bank
Reconciliation Statement), Printing Cheque/Cash Deposit Slips, printing Payment Advices, managing Cheques,
Import Bank Statement for Auto BRS, etc.

The banking transactions can now be provided with Bank Allocation details such as
the Transaction Type, Instrument No, Date, etc. A single bank amount can also be allocated
tomultiple transaction types such
as Cheque, Electronic Cheque, Electronic DD/PO, Inter Bank Transfer, Others and Same Bank Transfer based
on the requirement.

The BRS screen now provides detailed information with regard to transaction types, instrument no., instrument date,
cheque favouring, etc. The user can also provide Opening BRS forunreconciled transactions.

Features of Banking in Tally.ERP 9

The salient features of Banking in Tally.ERP 9 are as follows:

Cheque Printing:

 Allows user to configure cheques for banks using sample formats provided, which come along with images.

 Supports multiple Cheque formats for a single bank.

 Allows user to print the pending or already printed or the required cheques continuously from a single
screen.

 Also allows user to update the cheque details and have track of cheques to be printed, of a selected or all
banks.

 Vertical Cheque Printing is an enhanced feature in cheque printing.

 Configurations can be stored on Tally.NET for easy maintenance and update.

Cheque Register

 Allows user to configure cheque number ranges for Auto cheque numbering based on cheque range.

 Duplicate cheque number validation

 Report for cheques issued (like the issue log slip in the cheque books)
 Inventory of cheques available (not used)

 Stale/cancelled cheque management

 Filters based on Cheque range

Bank Reconciliation:

 The BRS screen allows user to reconcile the bank account.

 This screen will now provide detailed information with regard to transaction types, instrument no.,
instrument date, cheque favouring, etc.

 User can also provide Opening BRS for unreconciled transactions.

 Allows user to import bank statements to perform Auto Bank Reconciliation.

Deposit Slips:

 Bank-wise Cash Deposit Slips for the Cash being deposited can be generated automatically along with cash
denominations.

 Cash Deposit Slips that are required to accompany Cash that is being deposited to the Bank can be
generated automatically along with cash denominations.

Payment Advice:

 The payment advice sent to the suppliers / other parties along with the cheques/other instruments may be
generated quickly from the voucher itself.

To access Banking, go to Gateway of Tally > Banking.

[Img-1]

Migrating Banking Vouchers for Existing Data

When the existing users of Tally.ERP 9 access their company data using Tally.ERP 9 Release 3.0 for the
first time, will migrate the Banking vouchers.

On completion of migration, the following has to be considered for Bank Reconciliation:

 The Transaction Type row in the Bank Reconciliation screen will be blank. The user
may alter the vouchers and select the appropriate transaction type (Cheque/DD) in
the Bank Allocation table and accept the vouchers, in case required.

[Img-2]
 The Instrument Date displayed in the Bank Reconciliation screen will be
the Voucher Date. The reconciliation will be based on the Instrument Date provided
in the Bank Allocation table and not on the Voucher date.

[Img-3]

 The Bank Reconciliation screen lists the transactions on the basis of each transaction type selected in
the voucher.
Example: A single banking voucher having Cheque/DD and Electronic Cheque as Transaction type will be
considered as two transactions in the Bank Reconciliation screen.

Banking Features

Cheque Printing

Auto Bank Reconciliation

Manual Bank Reconciliation

Cheque Deposit Slip

Cash Deposit Slip

Payment Advice

Cheque Management

Banking Features - in Tally.ERP 9

Default features for Banking can be altered from
the F11: Features > F1: Accounting Features screen

Set the option Alter Banking Features to Yes

[Img-4]

The Banking Features screen appears as shown below:

[Img-5]

The fields in the screen are explained below:

Alter List of Transaction Types: On setting this option to Yes, the Alteration of Transaction Types
screen opens. In this the user can include or exclude Transaction Types, as required
[Img-6]
Note: At - le ast one Transacti on Type shoul d be e nabl e d for Payments and Recei pts.
Show Additional Bank Details For: Banking Details include Account Number, IFS Code, Bank Name
for Inter Bank Transfers and Account Number for Same Bank Transfer. On enabling this option, all
these Additional Details will get displayed during Voucher entry. If the user doesn't want to display these
details during entry, the option None can be selected.

Allow to Enter Beneficiary Code: On enabling this option, a button B:Show Beneficiary Code/Hide
Beneficiary Code is available in the Ledger Master Creation/Alteration screens. This will help the user
enter Beneficiary Code, specific to the Bank selected in the Company
Note: All Le dge r Creati on/Al te rati on scree ns have the opti on Al l ow to Enter
Benefi ci ary C ode , e xce pt C ash , P& L and Bank
Show Transfer Mode: Enabling this option, will display the Mode of Transfer (NEFT/RTGS) in the Bank
Allocations screen for Inter Bank Transfers transaction type while
passing Paymentsand Receipts voucher entry. This will get picked up during voucher entry using Voucher
Class

Enable Bank Details for Cost Centres: This option is available only if Cost Centres and Cost Categories are
enabled for the Company. On setting this to Yes, the Cost Centre Creation screen will have the option Provide
Bank Details.

Import Beneficiary Bank Account Details: Bank Account Details of the beneficiary can be imported in Excel
Format, if this option is set to Yes

If this option is set to Yes, the Import of Data screen appears as shown below:
[Img-7]

Enter the Import File Name, along with the location path to import the required Excel File

To view a sample file, click the button, P: Payee Sample File

Note: If Payrol l i s e nable d, the button, E: Empl oyee Sampl e Fi le i s avai l abl e , w hich i s
use d to i mport Em pl oyee Bank Detail s
The Exporting Sample File screen appears. On accepting this screen, the Ledger Bank Details file opens

Cheque Printing - in Tally.ERP 9

The Cheque Printing option in the Banking menu allows the user to print all the pending, already
printed or the required cheques continuously from a single screen. It also allows to update
the cheque details of a transaction, i.e., the instrument no, instrument date, cheque favouring, etc.
The bank ledger needs to be enabled for cheque printing from ledger creation or alteration mode.
Click the links given below for details.

Accessing Cheque Printing

Printing Cheques / Cheque Printing Reports

Configuring Cheque Printing

Accessing Cheque Printing

To access Cheque Printing screen,

 Go to Gateway of Tally > Banking > Cheque Printing.

The Select Bank screen displaying the List of Bank appears as shown:

[Img-8]

 Select All or the required Bank account from the List of Bank.

 Press Enter.

The Cheque Printing screen of the selected Bank is displayed as shown:

[Img-9]

 By default, this screen displays list of pending cheques of the current date’s month.

 Press F6: Show All to display all the cheques.

[Img-10]
Note: Thi s button toggl e s be twe e n Show Al l / Hi de Pri nted .
Bank Not Configured for Cheque Printing

The cheque printing screen will prompt with a message Bank not configured for Cheque
Printing when the bank ledger not configured for cheque printing is selected, as shown:

[Img-11]

The bank needs to be enabled for cheque printing from ledger alteration screen.

In the Cheque Printing screen of the ledgers configured for it,

 Select the required row from the Cheque Printing list to open the voucher
in alteration mode.

 F2: Period: Allows to change the period.

 F4: Bank: Allows to select All / Other required Bank from the list.

 F7: Edit Ch Details: Allows to edit/update

the Favouring Name, Instrument No and Instrument Date columns, as shown:
[Img-12]

 Accept the screen to save the settings.

 F12: Range: Allows to filter the Cheque printing screen. The user can filter the transactions
based on the Amount, Bank Date, Date, Favouring Name, Instrument
Date,Instrument No., Ledgers, Narration, Remarks and Transaction Type as shown:

[Img-13]
Printing Cheques / Cheque Printing Reports

The user may print All or selected cheque from the Cheque Printing list.

Printing All Cheques

To Print All Cheque from the list,

 Go to Gateway of Tally > Banking > Cheque Printing.

 Select the required Bank account from List of Bank. To change the selection made,
press F4: Bank button to select another bank.

 The Cheque Printing screen is displayed.

 Click Print or Press Alt+P.

The Print Report screen appears. Set the option Print Cheque to Yes as shown:

[Img-14]
Note: The opti on - Pri nt C heque appe ars onl y i f a parti cul ar bank is sele cte d for
pri nting che que s. O n selecti ng All Items for di spl ayi ng pe ndi ng che ques of di ffe re nt
banks i n che que pri nti ng scre e n, thi s opti on w ill not appe ar.

 Accept to Print all the cheques.

 The Cheque Printing proceeds and displays confirmation for each cheque with Cheque
Details, as shown:
[Img-15]

 Confirm to print cheque one by one before printing. Additionally the facility to change
the orientation and adjust the distance of top edge and left edge with flexibility to avoid
printing the date on cheque is provided.

Printer Selection

Press S: Select Printer button to select the printer and the paper size. Select the paper size as A4.

Orientation

In the Sample Cheque Printing screen, press N: Orientation button (Alt+N) to select the orientation.
The orientations - Vertical and Horizontal gets listed.

[Img-16]

On selecting Vertical - centre/left/right the cheque gets printed in vertically (oriented as portrait).
Using these options, the cheque can be printed by setting the orientation to:

 Vertical Left: On inserting the paper in the printer tray, the cheque gets printed vertically
on the left hand side of the paper.

 Vertical Centre: On inserting the paper in the printer tray, the cheque gets printed
vertically at the centre of the paper.

 Vertical Right: On inserting the paper in the printer tray, the cheque gets printed
vertically on the right hand side of the paper.

Additionally for printing the cheque face up or face down with vertical orientation, the field - Print
From (for Vertical Only) gets displayed. Depending on the printer, the front or rear can be selected.

 Front: In printers which print face up select Front.

 Rear: For printers which print face down place the paper in reverse order and select Rear.

On selecting Horizontal the cheque gets printed horizontally (oriented as landscape).

Overall Adjustment

Using the configuration provided for overall adjustment:

 The cheque dimensions pre-configured on selecting the cheque format can be adjusted such
that the overall dimensions get shifted by the required 'mm' from top and left edge of
cheque.

 While printing the cheque, date field can be left blank if it is not required to be printed.

From the Sample Cheque Printing screen, click on F12: Configure button and change/retain the
dimensions in 'mm' as per requirement.

[Img-17]

 Adjust Distance From Top Edge (in mm): To adjust the distance from top edge such
that the overall measurements defined in Cheque Dimensions screen get shifted as per the
'mm' entered here.

 Adjust Distance From Left Edge (in mm): To adjust the distance from left edge such
that the overall measurements defined in Cheque Dimensions screen get shifted as per the
'mm' entered here.

 Print Amount in Foreign Currency: Set this option to Yes, to print cheques for foreign
currency transactions in the respective currency.

 Print Date: By default the date gets printed on the cheque. If the date is not to be printed
on the cheque set this field to No.

Accept the configuration and print the cheque. The adjustments done for overall adjustment using F12:
Configuration of cheque printing screen does not affect the settings of Cheque Dimensions pre-
configured for the selected cheque format.

The Printed Cheque displays as shown:

[Img-18]

Printing Selected Cheques

To Print selected Cheques from the list,

 Go to Gateway of Tally > Banking > Cheque Printing.

 Select All or required Bank account from List of Bank.

 The Cheque Printing screen is displayed.

 Press spacebar to select the required row(s).

 Click Print or Press Alt+P.

 The Cheque Printing screen appears.

 Accept to print the cheque(s).

Cheque Report Printing

To print the Cheque report,

 Go to Gateway of Tally > Banking > Cheque Printing.

 Select All or required Bank account from List of Bank.

 The Cheque Printing screen is displayed.

 Click Print or Press Alt+P.

 Cheque Report Printing screen appears confirming to print.

 Click No or Press N or Esc.

o Print Cheque: This option appears on selecting a particular bank. Set it to No.

o Include Printed Cheques also: Set this option to Yes to display the printed cheques also
in the report.

o Show Forex Transactions only: Set this option to Yes in case you need only
the forex transactions to be displayed in the report.

Note: Thi s opti on appe ars onl y i n case Mul ti Currency fe ature i s e nabl e d for the
company.

o Show Payment Favouring: Set this option to Yes to display Favouring Name details in the
report.

o Show Remarks also: Set this option to Yes to display the Remarks in the report.

On setting Print Cheque it to Yes, the options - Include Printed Cheques also, Show Payment
Favouring and Show Remarks also gets set to No automatically as the user has opted to print
cheque. If Print Cheque is set to No, a statement displaying all entries including details of printed
cheques can be generated with information about favouring name and remarks as entered in the Bank
Allocation sub-screen of payment voucher.

The Cheque Report Printing screen is displayed as shown:

[Img-19]

 Accept to Print.

The Cheque Report Printing is displayed as shown:

[Img-20]

Configuring Cheque Printing

The user may configure the Cheque Printing screen based on his requirement.

To configure,

 Press F12: Configure, the Configuration screen is displayed as shown:

[Img-21]

Confirm each Cheque before Print

By default this is set to Yes. The cheque printing will confirm for each cheque before printing.

Include Printed Cheques also

By default, this option is set to No. Set it to Yes to display the Printed Cheques also
Note: Thi s opti on i s si mi l ar to the functi on ke y F6: Show Al l / Hi de Pri nted .

Show Forex Transactions only

By default, this option is set to Yes. The cheque printing screen displays only the forex transaction.
Note: Thi s opti on appe ars onl y i n case the company is e nable d
w i th m ul ti currency fe ature .

Show Payment Favouring

By default, this option is set to Yes. The cheque printing screen displays the Favouring Name column.
Note: The Favouri ng Nam e col umn di splays onl y those names w hi ch are di ffe re nt from
the Party/Ledge r account name s.

Show Remarks also

By default, this option is set to No. Set it to Yes to display the Remarks also.

Appearance of Name

Select the required Display Name Style from the list to display in cheque printing screen.

Scale Factor for Values

Select the required Scale Factors from the list.

Sorting Method

Select the required Sorting Methods from the list.

Auto Bank Reconciliation - in Tally.ERP 9

For the benefit of business entities and users, Tally.ERP 9 has provided the facility of selecting the
formats which include configurations and output file type for printing the cheques. Currently, the
formats of many banks with supporting file types - Excel, CSV and MT940 are made available.
Depending on the formats pre-filled in the ledger master of the bank selected in payment/contra
voucher and the output file types supported for it, the cheques can be printed.

In Tally.ERP 9, Bank Reconciliation capability is enhanced to view, import the bank statements and
to Auto Reconcile the transactions.

For Auto Bank Reconciliation (importing Bank Statement), valid Tally.NET Subscription and Internet
Connectivity are required for performing auto reconciliation. To know how to enable Auto Bank
Reconciliation,

To view, import and auto reconcile the banking transactions:

Go to Gateway of Tally > Banking > Bank Reconciliation > select the Bank > Bank
Reconciliation statement appears
[Img-22]

For banks enabled with the feature of auto reconciliation in ledger master, the buttons:

 B: Bank Statement and R: Reconcile Unlinked appear on the right side button bar

 D: Delete Unlinked button appears on the button bar above Info Panel.

Note: The faci li ty to Imp ort and Vi e w Bank State me nts wi ll ge t e nable d onl y for banks
e nable d wi th auto reconciliati on fe ature in bank l e dger cre ati on / al te rati on mode .

Bank Statement

Bank Statement button with the facility to view and import is provided to meet the customers
requirement. There could be cases where the user just want to view it and not import the statement
directly or wants to view it before it is imported, mainly to confirm that it’s the same file that has to be
imported.

Reconcile Unlinked

Once the transactions are imported and reconciled, if there are any entries appearing under the
section Amount not reflected in Company Books the Reconcile Unlinked button needs to be used to
reconcile it.

Delete Unlinked

Delete Unlinked button is provided to delete the unlinked vouchers.

View Bank Statement

Tally.ERP 9 makes it possible for the user to view the Excel, MT940 or .CSV files in a readable format,
with an option of choosing to import or not to.
Click on B: Bank Statement button or press Alt+B key.

On pressing the button, the Bank Statement File screen displays the Directory which was specified as
the Location of Bank Statements in F12: Configuration > Banking Configuration. Select the
required file format in File Type field based on the format of bank statement being imported.

In File Name field, a list of Excel files will get displayed. To view the Bank Statement which would
be imported, click the button I: With View or press Alt+I.

[Img-23]

Press F12: Configure. The option Show Imported Bank Statement will be displayed and set
to Yes by default. Using this option, the bank statement which is already imported can be selected again
for import. The files will be listed in alphabetical order with details of file type and import status
(showing whether it is already imported or not).

The Bank Statement appears as shown:

[Img-24]

 Users can either import the statement using Import button

or Quit the Bank Statement screen by pressing Escape key or click
on Ctrl+Q: Quit button (where the user is not intending to import the file).
Import Bank Statement

In the Bank Statement screen which is previewed press I: Import button. Users must ensure that the
bank statements being imported haven’t been edited or altered in any way. If any changes are made,
the error message - Not a valid format will be displayed while importing the statement.

During import, the Import progress bar gets displayed followed by the Success message with count
of Total Entries in Bank Statement, transactions Reconciled and Additional Bank Entries.

[Img-25]

The Bank Reconciliation Statement with Imported Bank Statement details appears as shown:
[Img-26]

The Reconciliation found at the bottom of the screen shows:

 Balance as per Company Books

 Amounts not reflected in Bank

 Amount not reflected in Company Books

 Balance as per Bank

The Balance as per Company Books reflects the balance as on the last date (in the example, it is
30th April).

The Amounts not reflected in Bank are the debit and credit sums of all those vouchers, whose Bank
Date is either BLANK, or LATER than 30-Apr (i.e. these vouchers have not yet been reflected in the
bank statement).

The Amount not reflected in Company Books are entries which are present in the bank statement
but are not recorded in company's books.

The Balance as per Bank is the net effect of the Book Balance offset by the amounts not reflected in
the Bank – which must be equal to the balance in the bank statement.
Note: Some di scre pancie s ma y pe rsi st due to entrie s made i n the bank state ment, w hich may
not have be e n e nte re d i n the books of accounts.

Auto Reconciliation of e-Banking Transactions

After Importing the file, the bank dates will get filled in Bank Dates field automatically
in Bank Reconciliation screen.

However, there may be transactions which have been executed at the bank’s end (example, bank
charges, interest credit etc.) but not yet reflected in the books of accounts. Such transactions will
appear under the Amount Not Reflected in Company Books in BRS statement with the required
details.

[Img-27]

User can either Reconcile Unlinked transactions to existing transactions or create a new
voucher (to create vouchers click on C: Create Vouchers button or press Alt+C key) using this
information or delete them.
Note: It is sugge ste d to save the Bank Reco nci l i ati on be fore reconcili ng the
Unl i nked Transacti ons to avoi d mi stake s.
1. Reconcile Unlinked

In this example, there is a withdrawal of 2,500 on 23-4-2012 which is not reconciled. To reconcile
the transaction select the transaction displayed under Amount Not Reflected in Company Books and
click on R: Reconcile Unlinked button or press Alt+R.
[Img-28]

Application will display the transaction(s) matching the Transaction amount for selection. Select the
appropriate transaction using spacebar and press Enter. The Status will be displayed
as Reconciled Successfully.

2. Reconcile All Unlinked

To reconcile all unlinked transactions without having to select one by one simply the reconciling process,
press R: Reconcile All Unlinked. This option provides a simple and convenient option to
reconcile transactions from the imported statement and company's book from a single screen without having to
manually match the transactions.
[Img-29]

An Unreconciled Transactions screen will display matching transactions and the amount not reflected which
is about to get reconciled is shown under Transaction from Bank Statements to be Reconciled as shown
below:

[Img-30]

 Press Enter to accept the transaction displayed to link and to reconcile

[Img-31]

 Press Quit or Esc to skip the current transaction and proceed to the next for reconciliation.
To stop the reconciliation process, press Alt+S:Stop

If there are no matching transactions, then the screen will be blank and the amount not reflected will be
showing the transaction on the top. In case, there are no transaction to link, a message No unreconciled
transaction exists with same amount will be displayed as shown below:
[Img-32]

3. Create a New Voucher

If there is any transaction which is not reflected in the books of accounts, click C: Create
Voucher button or press Alt+C key to navigate to Voucher Creation screen.

[Img-33]

On recording the transaction against the Amount Not Reflected in Company Books, the details
displayed will be removed from the Amount Not Reflected in Company Bookssection indicating that
the corresponding entry is found in the books of accounts.
Note: You can re cord a Payment/Receipt/Journal vouche r to account for those
e ntri e s that are not re fl ecte d i n Company Books.
4. Error on re-importing the Excel/csv file

While selecting the bank statement for importing, the statement which is already imported will also
appear. To hide the imported statement, click S: Hide Imported button. On using this button only the
statement which is not yet imported gets displayed. The Hide Imported is a toggle button which can
also be used to Show Imported statements.
[Img-34]

In cases where the user has already imported an Excel/csv file and tries to re-import it by mistake, an
error message will be displayed indicating that Bank Details are reflected in your books of accounts.

[Img-35]

5. View Difference in Bank Balance

To view difference in Bank Balance click on F12: Configure and the option Show Difference in Bank
Balance to Yes
[Img-36]

The difference in Bank Balance (difference in Balance as per Bank and Balance as per Imported
Bank Statement) will be shown in Bank Reconciliation Statement. In the Bank Reconciliation screen,
the Balance as per Imported Bank Statement refers to the balance displayed on importing the bank
statement for reconciliation.

[Img-37]

Manual Bank Reconciliation - in Tally.ERP 9

The Bank Reconciliation option in the Banking menu allows the user to perform the following operations:
 Reconcile Bank accounts.

 Create vouchers from the Bank Reconciliation screen itself.

 The user can also provide opening BRS for unreconciled transactions.

 Alter the voucher by selecting the required transaction from the Bank Reconciliation
screen.

 Filter the report to display transactions based on Amount, Bank Date, Instrument No,
Instrument Date, Party ledger, etc.

Accessing Bank Reconciliation

Printing Bank Reconciliation Statement

Configuring Bank Reconciliation Statement

Accessing Bank Reconciliation

To access Bank Reconciliation screen,

 Go to Gateway of Tally > Banking > Bank Reconciliation

 The Select Bank screen displaying the List of Bank appears as shown:

[Img-38]

 Select the required Bank account from the List of Bank and press Enter.
The Bank Reconciliation screen of the selected Bank appears. By default the details in the Bank
Reconciliation screen are sorted based on Bank Date (if bank date is already specified for the
transaction). Or else, such sorting will be based on the Instrument Date.

[Img-39]
Note:

1. The Bank Re conci liati on scre en can al so be acce sse d from Gateway of
Tal l y > Di spl ay > Accounts Books > Cash/Bank Books >
Se le ct Bank Ledger >Select a month > F5: Reconci l e .

2. By de faul t, the scre en di spl ays the pe ri od range from date spe ci fi e d i n the Ef f ecti ve
Date for Re concili ati on i n the Bank le dge r maste r til l the date of l ast entry .

3. The Bank Date has be to be pro vi de d base d on the Instrument Date and not
on Voucher Date .

Button options in Bank Reconciliation screen

F2: Period

Press F2 key or click F2: Period to specify a period for which the Bank Reconciliation screen is to be
displayed.

S: Set Bank Dates

To set a bank date for all the transactions for reconciliation, click S: Set Bank Dates button or
press Alt+S key.

On pressing Alt+S, a Set Bank Date sub-screen appears as shown:

[Img-40]

 Instrument Date: On selecting Instrument Date as the Bank Date Type, the Bank
Date field for all the transactions in the Bank Reconciliation screen is filled with the
instrument date entered for that transaction in the Bank Allocations screen.

 New Date: On selecting New Date as the Bank Date Type, a new field Date appears in
the Set Bank Date sub-screen.

[Img-41]

Specify the required bank date that is to be filled for all the transactions in the Bank
Reconciliation screen.

 Voucher Date: On selecting Voucher Date as the Bank Date Type, the Bank Date field
for all the transactions in the Bank Reconciliation screen is filled with the Date of Voucher.

C: Create Voucher:

Press Alt+C key or click C: Create Voucher to create a voucher from the Bank Reconciliation screen
itself.

U: Opening BRS

In Tally.ERP 9 Series A Release 3.0 onwards the user may provided opening BRS to the unreconciled
transactions using this function.

The opening BRS will be used in the following scenarios:

 The BRS feature was used in the middle of the financial year by setting Effective Date
of Reconciliation in Bank ledger master in Tally.ERP 9, or

 Accounting was started in Tally.ERP 9 in the middle of the financial year.

 Opening balance of Bank having unreconciled transactions brought forward to Bank

ledger created in Tally.ERP 9, or for other reasons.

In these cases the user had to manually keep track of the unreconciled transaction until they are
reconciled.

To provide Opening BRS:

 Click U: Opening BRS.

 The Opening Bank Allocation screen for the selected Bank is displayed as shown:

[Img-42]

 Provide the unreconciled transaction details based on the nature of

transactions (Deposit/Withdrawal) as shown:

[Img-43]

 Save the screen.

 When the company data is split the unreconciled transactions will automatically get
updated in the Opening BRS details.

The Bank Reconciliation screen is displayed with opening BRS provided as shown:

[Img-44]

 Provide the date of the realised transactions (the amount reflecting in the bank passbook)
in the Bank Date field provided.

 Save the Bank Reconciliation screen.

Note: Whe n the use r trie s to acce ss F12 : Range for fi l te rs in

the Bank Reconci li ati on scre en, wi ll prompt to Accept the curre nt scree n be fore
proce e ding.

 Press Ctrl+Enter on the required transaction row to open the voucher in alteration mode.

F12: Range

Allows to filter the Bank Reconciliation screen. The user may filter the transactions based on the
Amount, Bank Date, Date, Favouring Name, etc as shown:
[Img-45]

Configuring Bank Reconciliation

The user may configure the Bank Reconciliation screen based on his requirement.

To configure,

 Press F12: Configure, the Configuration screen is displayed as shown:

[Img-46]

Select vouchers to show

By default, all the vouchers are displayed. Select the required Ledger Entries type from the list.

Show Narrations also

Set this option to Yes to display the narration in the Bank Reconciliation screen.

Show Remarks also

Set this option to Yes to display the remarks in the Bank Reconciliation screen as shown:

[Img-47]

Show Forex details also

Set this option to Yes to display the forex details also in the report.

Show Forex Transactions only

By default, this option is set to Yes. The cheque printing screen displays only the forex transaction.
Note: The opti ons Show Forex detai l s al so and Show Forex Transacti ons
onl y appe ar onl y in case Mul ti Currency fe ature i s e nable d for the company.

Show Reconciled Transactions also

Set this option to Yes to display the reconciled transactions also in the Bank Reconciliation screen.

Allow Back dated Reconciliation

Set this option to Yes to allow reconciling back dated transactions also.

Show Payment Favouring / Received From

Set this option to Yes to display the Payment Favouring / Received From details in the Bank
Reconciliation screen.

The Bank Reconciliation screen

with Narration, Remarks and Payment Favouring/Received From details is displayed, as shown:
[Img-48]
Note:

1.The Favouri ng Nam e col umn di spl ays onl y those name s w hi ch are di ffe re nt from
the Party/Ledger account name s.

2. Bank Re concili ati on capabi li ty has bee n e nhance d, from thi s scree n use rs can
* Vi e w the vouche r di spl ay by pre ssi ng Al t + Enter from Bank Date fi el d
* Al te r the Vouche r by pre ssing Ctrl +Enter from Bank Date fi el d

Show all Unreconciled Transactions Till Date

Set this option to Yes to display all the Unreconciled Transactions till the given date, irrespective of
the From date set in the Bank Reconciliation Statement.
Note:
1. Thi s opti on i s al so avai labl e i n Gateway of Tall y > F12:Confi gure > General .

2.The opti on se t wi ll be appl i cabl e to all the banks for the sel e cte d company.

Appearance of Name

Select the required Display Name Style from the list to display in cheque printing screen.

The completed Bank Reconciliation screen is displayed as shown

[Img-49]

Printing Bank Reconciliation Statement

The user may print the Bank Reconciliation statement for the required Bank.

To Print Bank Reconciliation Statement:

 Go to Gateway of Tally > Banking > Bank Reconciliation.

 Select the required Bank account from List of Bank.

 The Bank Reconciliation screen is displayed.

 Click Print or Press Alt+P.

The Print Report screen appears.

[Img-50]

 Click No or Press N or Esc to set the following options:

o Select Vouchers to Show: By default this is selected as All Vouchers, select the required
option from the Ledger Entries list.

o Show Narrations also: Set this option to Yes to display the narration in the report.

o Show Remarks also: Set this option to Yes to display the remarks in the report.

o Show Forex details also: Set this option to Yes to display the forex details in the report.

o Show Forex Transactions only: Set this option to Yes to display the forex transactions
only in the report.

Note: The opti ons Show Forex detai l s al so and Show Forex Transacti ons
onl y appe ar onl y in case Mul ti Currency fe ature i s e nable d for the company.

o Show Reconciled Transactions also: Set this option to Yes to display the reconciled
transactions also in the report.

o Show Payment Favouring/Received From: Set this option to Yes to display the Payment
Favouring/Received From details in the report.

 Accept to Print.

The Bank Reconciliation Statement appears as shown:

[Img-51]

Alteration of Reconciled Voucher

In some cases users may alter the reconciled vouchers by changing/splitting the amount, in such cases
Tally.ERP 9 will display the message asking the confirmation to continue with the alteration. Users can
later a reconciled voucher from Day Book, Bank Conciliation or from voucher reports.

Here ABC company is altering the voucher dated 3-7-2010 (already reconciled) where the company has
issued the cheque for Rs. 1000 to Supreme Computers
Note: To al te r a vouche r from Bank Reconci l i ati on re port, from Bank Date fie l d pre ss
Ctrl + Ente r

The amount of 1000 has been split into 600 & 400. On saving this voucher Tally.ERP 9 displays the
message indicating the reconciled voucher is altered and bank balance in BRS will not Match, hence
Bank Date will be removed.

Cheque Deposit Slip - in Tally.ERP 9

The Cheque Deposit Slip option in the Banking menu allows the user to generate the deposit slip
for payments received through cheque/dd which need to be deposited into the bank.

Click the below links for detail.

Accessing Cheque Deposit Slip

Printing Cheque Deposit Slip / Cheque Deposit Slip Report

Configuring Cheque Deposit Slip

Accessing Cheque Deposit Slip

To access Cheque Deposit Slip screen,

 Go to Gateway of Tally > Banking > Deposit Slip > Cheque Deposit Slip.

 The Select Bank screen displaying the List of Bank appears as shown:
[Img-53]

 Select the required Bank account and press Enter.

The Cheque Deposit Slip screen of the selected Bank is displayed as shown:

[Img-54]
Note: The Che que D e posi t Sl i p scre e n di spl ays onl y those transacti ons w hi ch
have C heque/DD as Transacti on type all ocate d i n the Bank All ocati on tabl e i n
the Recei pt vouche r e ntry.

 Select the required row from the Cheque Deposit Slip list and press Enter to open the
voucher in alteration mode.

 F2: Period allows to change the period.

 F4: Bank allows to select other required Bank from the list.

 F5:Cash allows user to view cash transactions (for the same Bank).

 F6: Show All allows user to view the transactions for which cheque deposit slips haven’t
been printed or to view all transactions for that bank for the period mentioned.

 F7: Edit Ch Details allows to edit/update the Received From Name

and Instrument No. as shown:

[Img-55]
Note:

The Received From i s an addi ti on fie l d avai labl e i n the Che que De posi t Sl i p scre e n to
spe ci fy the name of Indi vidual / Busi ne ss O rgani sation w ho has i ssue d the cheque , to be
pri nte d in the de posi t sli p / re port.

Whe n the use r tri e s to acce ss F12 : Range for fi l te rs i n Edi t Che que D e tail s scree n, wi ll
prompt to Accept the curre nt scre e n be fore proce e ding.

Accept the screen to save the settings.

 Ctrl+P: Mark as Printed allows to mark all the Cheque Deposit Slips as Printed at once.

 F12: Range allows to filter the Cheque Deposit Slip screen. The user may filter the cheque
details based on the Amount, Bank Date, Date, Party Ledger, etc as shown:
[Img-56]

Printing Cheque Deposit Slip / Cheque Deposit Slip Report

The user may select All or the required receipts to be included in the Cheque Deposit
Slip. The Cheque Deposit Slip report prints all the receipts for the selected period.

Printing Cheque Deposit Slip

To Print the Cheque Deposit Slip,

 Go to Gateway of Tally > Banking > Deposit Slip > Cheque Deposit Slip.

 Select the required Bank account from List of Bank.

 The Cheque Deposit Slip screen is displayed with the list of receipts.

To include all the receipts in the Cheque Deposit Slip,

 Click Print or Press Alt+P.

To include selected receipts in the Cheque Deposit Slip,

 Press Spacebar to the required receipt row(s).

 Click Print or Press Alt+P.

The Printing Cheque Deposit Slip screen appears.

[Img-57]

 Click No or Press N or Esc to set the other options as follows:

o Print Deposit Slip: By default, this option is set to Yes.

o Date of Printing: By default, the current date is displayed. Specify the required date to be
printed in the Cheque Deposit Slip.

o Space to leave on Top (default 0.5 inches): Set the required space.

o Show Received From: Set this option to Yes to print the Received From details in the
deposit slip.

o Print Company's Telephone Number: Set this option to Yes to print the Company's
Telephone Number.

o Print Company’s PAN/IT Number: By default, this option is set to Yes.

Note: The opti on Show Forex Transacti ons onl y w ill ski p w he n you are opti ng to pri nt
the C heque Deposi t Sl i p .

 Accept to Print.

The Cheque Deposit Slip is displayed as shown:

[Img-58]

Printing Cheque Deposit Slip Report

To Print the Cheque Deposit Slip Report,

 Go to Gateway of Tally > Banking > Deposit Slip > Cheque Deposit Slip.

 Select the required Bank account from List of Bank.

 Click Print or Press Alt+P.

The Printing Cheque Deposit Slip screen appears.

 Click No or Press N or Esc to set the other options as follows:

o Print Cheque Deposit Slip: By default, this option is set to Yes. Set this option to No to
print the report.

o Space to leave on Top (default 0.5 inches): Set the required space.

o Show Forex Transactions only: By default, this option is set to No. Set this option
to Yes in case you need only the forex transactions to be displayed in the report.

Note: Thi s opti on appe ars onl y i n case Mul ti Currency fe ature i s e nabl e d for the
company

o Show Received From: Set this option to Yes to display the Received From details in the
report.

o Show Bank/Branch Name also: Set this option to Yes to display

the Bank and Branch columns in the report.
o Show Remarks also: Set this option to Yes to display the Remarks in the report.

 Accept to Print.

The Cheque Deposit Slip Report is displayed as shown:

[Img-59]
Note: The Recei ved From col umn wi ll di spl ay the rece i ve r's name ( provi de d i n
the Bank All ocati on) , only i f i t i s di ffe re nt from the Party/ Le dge r Name di splaye d
i n Parti cul ars col umn.

Configuring Cheque Deposit Slip

The user may configure the Cheque Deposit Slip screen based on his requirement.

To configure,

 Press F12: Configure, the Configuration screen is displayed as shown:

[Img-60]

Show Forex Transactions only:

By default, this option is set to No. Set it to Yes to display only the forex transactions.
Note: Thi s opti on appe ars onl y i n case the company is e nable d
w i th m ul ti currency fe ature .
Show Received From:

By default, this is set to No. Set it to Yes to display Received From column in the Cheque Deposit Slip
screen to specify the details as shown:

[Img-61]

Show Bank/Branch Name Also

By default, this is set to No. Set it to Yes to display Bank and Branch columns in the Cheque Deposit
Slip screen.

Show Remarks also:

By default, this is set to No. Set it to Yes to display Remarks column in the Cheque Deposit Slip
screen.

Appearance of Name:

Select the required Display Name Style from the list to display in deposit slip screen.

Scale Factor for Values:

Select the required Scale Factors from the list.

Sorting Method:

Select the required Sorting Methods from the list

Cash Deposit Slip - in Tally.ERP 9

Any cash received has to be deposited in the bank with relevant Cash Deposit Slip attached. Tally.ERP 9 allows
users to generate cash deposit slip for depositing cash into a bank on any particular date. The Cash Deposit
Slip option in the Banking menu is used to generate cash deposit slips, bank-wise.

The Cash Deposit Slip provided in Tally.ERP 9 has all the contents of cash deposit slip – Account Number,
Account Holder Name, Bank Name, Branch Name (information is fetched automatically from Bank ledger),
Company’s Telephone Number, (information is fetched automatically from Company Creation screen), and
Cash Denomination Details (information is fetched automatically from Contra voucher), so that user will not
have to manually enter all the details.

Accessing Cash Deposit Slip

Printing Cash Deposit Slip / Deposit Cash Slip Report

Configuring Cash Deposit Slip

Accessing Cash Deposit Slip

To access Cash Deposit Slip screen,

 Go to Gateway of Tally > Banking > Deposit Slip > Cash Deposit Slip.

[Img-62] [Img-63]

 List of Bank will be displayed in the Select Bank screen as shown:

[Img-64]

 Select the required Bank account from the list for whose transaction you want to print Cash
Deposit Slip and press Enter.
The Cash Deposit Slip screen of the selected Bank is displayed as shown:

[Img-65]
Note: The C ash Deposi t Sl i p scre en di splays onl y those transacti ons w hi ch
have C ash as Transacti on Type all ocate d i n the Bank Al l ocati on scree n i n
the C ontra vouche r e ntry.

 Select required row from the Cash Deposit Slip list and press Enter to open the voucher
in alteration mode.

 F2: Period is used to view cash transactions for a particular period.

 F4: Bank is used to toggle between the banks from the same screen. This will reduce navigation
time.

 F5: Cheques allows user to view transactions for which Cheques/DDs have been received (for the
same Bank), and print Cheque Deposit Slip for the same.

 F6: Show All allows user to view the transactions for which cash deposit slips haven’t been printed or
to view all transactions for that bank for the period mentioned.

 F12: Range allows user to filter Cash Deposit Slip screen. User may filter the transactions based on
the Amount, Date, Bank Date, Instrument Date, etc. as shown:

[Img-66]

This is a useful tool, as it makes the process of finding particular transactions fast, easy and simple.

Printing Cash Deposit Slip / Cash Deposit Slip Report

 Cash Deposit Slip can be printed for all or just selected transactions.

 Cash Deposit Slip Report can be printed for all the transactions for the selected period

Printing Cash Deposit Slip

To Print the Cash Deposit Slip,

 Go to Gateway of Tally > Banking > Deposit Slip > Cash Deposit Slip

 Select the required Bank account from List of Bank.

 The Cash Deposit Slip screen displays the list of transactions for the bank selected.
To print Cash Deposit Slip for selected transactions,

 Press Spacebar to select required transaction(s).

 Click Print or Press Alt+P.

The Printing Cash Deposit Slip screen appears.

[Img-67]

 Date of Printing: The date that has to be printed on the Cash Deposit Slip has to be specified in
this field. By default, the current system date is displayed. Usually, this date will be the date on which
the actual deposit of the cash into the bank will be made.

 Space to leave on Top (default 0.5 inches): This is the space between the top of the page and the
Title (First Line on the page). User can specify the dimension as per requirement.

 Print Company's Telephone Number: Set this option to Yes to print the Company's Telephone
Number. The Telephone Number specified in the Company Creation screen will be captured.

 Print Company’s PAN/IT Number: The PAN or IT Number specified in the F11: Features (F3:
Statutory & Taxation) will be captured. By default, this option is set to No.

 Click on Yes or Press Y or Enter to Accept.

 A new screen will appear where Cash Denomination details can be specified for individual
transaction, as shown:
[Img-68]

 By default, it will take the cash denominations specified in the Contra voucher. If the Cash
Denominations are different during actual cash deposit in bank, click on No or press N or Escand
enter the Cash Denomination details.

 Accept to print.

The Cash Deposit Slip is displayed as shown:

[Img-69]

Note: If A /c Hol der Name i s not me nti one d i n the Bank l e dge r maste r, the n the name
of the company as me nti one d in the Company Creati on scre e n w il l be pri nted
as Account Hol der Nam e of the Cash Deposi t Sl i p.
The Cash Deposit Slip for the first transaction will be printed.

For the next transaction selected, a new Cash Denomination details screen will appear. User can specify the
details and print the Cash Deposit Slip.

A separate Cash Deposit Slip will be printed for all the selected transactions.

To print Cash Deposit Slips for all transactions,

 Click Print or Press Alt+P.

The Printing Cash Deposit Slip screen appears.

[Img-70]

 Click No or Press N or Esc to set the other options as follows:

[Img-71]

 Print Cash Deposit Slip: When all the transactions are selected for printing, user can print a report of
the Cash Deposit Slip by setting this option to No. By default, this option is set to No.

 Date of Printing: By default, the current date is displayed. Specify the date to be printed in the Cash
Deposit Slip. This date should be the date on which the actual deposit of the cash in the bank will be
made.

 Space to leave on Top (default 0.5 inches): This is the space between the top of the page and the
Title (First Line on the page). User can specify the dimension as per requirement.

 Print Company's Telephone Number: Set this option to Yes to print the Company's Telephone
Number. The Telephone Number specified in the Company Creation screen will be captured.

 Print Company’s PAN/IT Number: The PAN or IT Number specified in the F11: Features (F3:
Statutory & Taxation) will be captured.

 Click on Yes or Press Y or Enter to Accept.

 A new screen will appear where Cash Denomination details can be specified for individual
transaction, as shown:
[Img-72]

 Accept to print.
The Cash Deposit Slip is displayed as shown:
[Img-73]
The Cash Deposit Slip for the first transaction will be printed.

For the Next transaction selected, a new Cash Denomination details screen will appear. User can specify the
details and print the Cash Deposit Slip.
A separate Cash Deposit Slip will be printed for all the transactions.

Note: 1. If the opti on Pri nt Consoli dated Cash Deposi t Sli p i s se t to Yes, the n
a bl ank C ash Denom i nation detail s scree n i s di spl aye d and a combi ned Cash D e posi t
Sl i p is pri nte d for al l the transacti ons sel ecte d.

2. O n fi ll ing i n the de tai l s in thi s scre en and pre ssi ng Ente r at the e nd, a noti fi cati on i s
di spl aye d – Detai l s entered here wil l not get updated in the vouchers .

Printing Cash Deposit Slip Report

To Print the Cash Deposit Slip Report,

 Go to Gateway of Tally > Banking > Deposit Slip > Cash Deposit Slip.

 Select required Bank account from List of Bank.

 Click Print or Press Alt+P.

The Printing Cash Deposit Slip screen appears.

[Img-74]

 Click No or Press N or Esc to set the other options as follows:

 Print Cash Deposit Slip: Set this option to No to print the Cash Deposit Slip report.

 Space to leave on Top (default 0.5 inches): This is the space between the top of the page to the
Title (First Line on the page). User can specify the dimension as per requirement.

 Show Remarks also: Set this option to Yes to display the Remarks in the report.

 Accept to Print.
The Cash Deposit Slip Report is displayed as shown:
[Img-75]

Configuring Cash Deposit Slip

User may configure the Cash Deposit Slip screen based on requirements.

To configure,

 Press F12: Configure, the Configuration screen is displayed as shown.

[Img-76]

Print Consolidated Cash Deposit Slip:

This option, when enabled, is used to print a single Cash Deposit Slip for all selected transaction. By default,
this is set to No. Set this option to Yes, to generate a Consolidated Cash Deposit Slip of the selected
transactions.

Include Printed Cash Deposit Slips also:

To view all the transactions for a given period, even if Cash Deposit Slip has been printed for them, this option
can be set to Yes.

Note: This opti on wi ll w ork i n accordance w ith the F6: Show All opti on i n the Button
Bar.

Show Remarks also:

To view the remarks entered in the Contra voucher, set this option to Yes. A Remarks column will appear in the
Cash Deposit Slip screen. By default, this is set to No.

Appearance of Name:
In the Cash Deposit Slip screen, user can choose the Display Style of the name under Particulars column;
Alias (Name), Alias Only, Name (Alias) or Name Only, using this option.

Scale Factor for Values:

User can choose to view the Value in the Amount column based on different factors – Crores, Hundreds,
Lakhs, Millions, Ten Lakhs, Ten Millions, Ten Thousands, and Thousands.

Sorting Method:
List of transactions can be sorted by user by selecting any of the Sorting Methods from the list. The
transactions can be sorted in ascending or descending order based on – Amount-wise, Date, Instrument Date,
Instrument Number, Party-wise. By default, the transactions are sorted in ascending order based on Date.

Payment Advice - in Tally.ERP 9

The Payment Advice option in the Banking menu allows the user to generate the payment advice to be
sent to suppliers/other parties along with the cheques/other instruments.

 Accessing Payment Advice

 Printing Payment Advice

Accessing Payment Advice

To access Payment Advice screen,

 Go to Gateway of Tally > Banking > Payment Advice.

The ledger selection screen displaying the List of Ledgers appears as shown:
[Img-77]

 Select the required Ledger and press Enter.

Note: If Al l i te ms i s sel e cte d, the payme nt advice for al l transacti ons wil l be displ aye d

The Payment Advice screen displays the payment list of the selected ledger as shown:

[Img-78]

 Select the required row and press Enter to open the voucher in Alteration mode.
 Press F12:Configurations for more options as shown below:

[Img-79]

Confirm each payment advice before Print/e-Mail: If user selects multiple transactions for
mailing/printing belonging to different Parties, then the confirmation screen will be displayed one by one for
each party's payment advice. If this option is set to No then Confirmation screen display once.
Note: The opti on wi ll come w he n user sel e cts "All Ite ms' and not w he n i ndi vi dual le dge r
i s sel ecte d
Start Fresh page for Print/e-Mail : When this option is set to Yes, if user selects multiple transactions for
mailing/printing belonging to same Party, then print/mail for one transaction will happen per page at a time
(without combining all into one page)

To print the Payment Advice when a single ledger is selected,

Go to Gateway of Tally > Banking > Payment Advice.

 Select the required Ledger account from List of Ledgers.

The Payment Advice screen is displayed with list of payment vouchers.

[Img-80]

To print each transaction or payment advice in separate page,

 Press F12:Configure

o Set Yes to Start fresh page for each transaction for Print/e-Mail as shown below:
[Img-81]

o Accept the screen

Printing Payment Advice

To print the payment advice of all the payments,

 Click Print or Press Alt+P.

To print the payment advice for the selected payments:

 Press Spacebar to select the required payment row(s)

 Click Print or Press Alt+P.

The Print Report screen appears as shown below:

[Img-82]

 Click No or Press N or Esc key to set the other options as follows:

o Payment Advice Date: By default, the current date is displayed. Provide the required date
o Include Bill Details: By default, this options is set to No. Set it to Yes to include the bill
details in the payment advice

o Show Transferred to: By default, this options is set to No. Set it to Yes to show
the transferred information like A/c No, IFS code, Bank Name which is applicable for Inter
& Same Bank Transfer

o Print Due Date: By default, this option is set to No. Set it to Yes to print the due date in
the payment advice

o Print Company’s PAN/IT Number: By default, this option is set to No. Set Yes to print
the PAN/IT No of the company

Button options in the Payment Advice report

F2: Period

Press F2 key or click F2: Period button to change the period.

F4: Ledger

Press F4 key or click F4: Ledger button to select other required Ledger from the list.

P: Mark as Printed

Press P: Mark as Printed or click Ctrl + P to mark the transaction as printed. When data is migrated
from a lower release to release 4.8, many of the transactions for which payment advice have already
been printed will appear as not printed in release 4.8. This option can be used to mark those
transactions as printed.

F12: Configure

To configure the Payment Advice for printing,

 Click F12: Configure button or press F12 key from the Print Report of the Payment
Advice screen

The Payment Advice Print Configuration screen appears as shown:

[Img-83]
Note: The Payme nt Advi ce Pri nting Confi guration scre e n al l ow s the use r to
e nable / di sable Pri nti ng Com pany Logo . The Location of Logo se t i n F11: Accounting
Features w ill be the pre - fil le d i n thi s scre e n w hi ch can be al te re d as pe r re qui reme nt.

 Set the required options and press Ctrl+A to save the settings
The Print Report screen appears.

 Press Ctrl+A or click Accept to Print

The print previews of the selected Payment Advices will be displayed as one payment advice per page as
shown below:

Cheque Management Voucher Entry - in Tally.ERP 9

Auto Cheque Numbering and Selection of Cheque Books during Bank allocation is supported in all
Accounting Vouchers in Tally.ERP 9. To know how to provide Cheque Range for auto cheque numbering,
click here.
Payment Voucher is taken to explain these two features used for Cheque Management.
To view the Payment Voucher entry screen:

 Go to Gateway of Tally > Accounting Vouchers

 Select F5: Payment from the Button Bar or press F5.

Payment voucher can be passed using Single Entry or Double Entry mode by configuring the setting Use
Single Entry mode for Pymt/Rcpt/Contra in F12: Configure.
[Img-85]

To use Auto Cheque Numbering during Bank Allocation the following options in F12: Configure has to be
enabled:

 Use Auto Cheque Numbering

 Allow Selection of Cheque Range

[Img-86]
Record a Payment voucher for the following: The Company settles a Creditor’s bill (Purchase) via Cheque.
This entry can be passed in single entry mode where you will be crediting the Bank Ledger (for which Cheque
Books has been configured) and debiting the Party Ledger, as shown:
[Img-87]

In the Bank Allocation screen,

 The Nickname will appear as defined in the Provide Bank Details during the ledger
creation.

 The Favouring Name and Amount fields are prefill based on the Payment entry
recorded.

 The Transaction Type is set to Cheque by default. This can be changed based on
requirement.

 For Transaction Type – Cheque:

o User can choose a Cheque Range (Cheque Books) from the list of Cheque books defined for
the bank, in the Cheque Range field.

o The Cheque Number will be automatically filled in the Instrument Number field. User still
has the option to manually change the Cheque Number, if required.

Note: If the Che que numbe r e nte re d doe s not fall in the sel ect Che que Range , Tall y.ERP
9 w il l throw an e rror - The Instrument number entered i s out of the Cheque
range and the cursor wil l re turn to the Instrument Number fi el d.

o Multiple allocations can be done in Bank Allocation screen as shown:

[Img-88]

 For each allocation, a different range can be chosen or the same cheque range can be
chosen. When the same range is chosen, the subsequent cheque numbers will be
automatically filled in Instrument Number field.

 Once Bank Allocations are done, accept the Payment voucher by pressing Y or Enter, or by
clicking on Yes.
[Img-89]
If the Cheque Printing is enabled for the Bank, once the payment voucher is accepted, the Cheque Printing
screen will appear.

 To print the cheque, click on Yes, or Press Y or Enter.

 To print the cheque later, click on No, or press N or Esc Key.

Cheque Management Cheque Register -

in Tally.ERP 9
Cheque Register helps users to manage their cheque books for various banks, give information about
Cheques which do not belong to any cheque range available and also the status of all the cheques. This report
gives the values of the total number of cheques for each bank (Cheque Book wise), that are Available,
Unreconciled, Reconciled, Blank and Cancelled.

The advantages of the Cheque Register:

 User will know how many cheques are available for use.

 Used cheques are classified as Unreconciled and Reconciled.

 Unreconciled cheques can be reconciled from the Cheque Register itself.

 Cheque Register has an option to Search for Cheque Numbers.

 Report can be viewed either Bank-wise or Cheque Range wise or drill-down to Cheque
numbers.

 Users are allowed to change the status of cheques (Available) to Cancelled or Blank and
make cancelled cheques available.

 Report can be viewed period-wise, hence makes it easier to filter the cheques that are
issued on particular date or during a particular period.

For more information, click on the links below:

Cheque Register

Altering Cheque Status

Configuring Cheque Register

Cheque Register

To view the Cheque Register:

Go to Gateway of Tally > Banking > Cheque Register

[Img-90]

The Cheque Register report screen will appear as shown:

[Img-91]

The first level of the Cheque Register displays all the Banks and gives the number of total cheques which are
Available, Unreconciled, Reconciled, Blank and Cancelled.

Users can drill down from any of the fields.

 To view the break-up of the statics based on the Cheque Ranges, press F1: Detailed.
[Img-92]

 The period of the report can be changed using the F2: Period option.

 Using F5: Reconcile button, users can go to the Bank Reconciliation screen for a
particular bank.

 To search for a particular cheque’s details, press S: Quick Search. Part of the cheque
number can be used to search for a cheque. The search results will have all the cheques
which have the search string as shown:
[Img-93]

 To view all the Cheques that belong to a particular status like Available, Blank Cheque,
Cheque Cancelled, Reconciled and Unreconciled, irrespective of banks and Cheque Ranges,
users can press Ctrl+S (Show All) and select the Status.

[Img-94]

When Enter is pressed from a Bank, Cheque Register shows the statistics of all the Cheque Ranges of that
bank, as shown:
[Img-95]

 When the cursor is on a Cheque Range, to reconcile the cheques that are used in that
range, press F5 or click on F5: Reconcile. Tally.ERP 9 will list out all the transactions
corresponding to the Cheques in that range that have to be reconciled.

 S: Quick Search option can be used in this screen as well.

 Ctrl+S (Show All) option can be used to view all the cheque numbers of a particular
status, irrespective of the Cheque Ranges, for the selected bank.

 To toggle between banks press F4 or click on F4: Bank button.

 To view all the transaction details of all the Cheques in the Bank press F7 or click on F7:
Transactions. All the details of every cheque for that bank will be displayed as shown:
[Img-96]
Note: To vi ew all the transacti ons of all the che que s i n a parti cul ar range ,
pre ss Enter from that range .

 To view the cheques for a particular period, press F2 or click on F2: Period.

 To toggle between the different Cheque Ranges in a bank from the same screen,
press Ctrl+C (Cheque Range).

[Img-97]

 To reconcile the unreconciled cheques, press F5 or click F5: Reconcile.

 Press Alt+F5 or click on F5: Status wise, to get a Status wise statistics of the cheque
range.
[Img-98]

 To view all Cheques of a particular status, press F6 or click on F6: Status. A new screen
will appear where user can choose among the different statuses of cheques.

[Img-99]

 To change the status of a cheque, select the Cheque Number and press Alt+A or
click A: Alter Status. The status of Available cheques can be updated
as Blank orCancelled. The Status of Cancelled cheques can be changed to Available.

 For Available Cheque Numbers, users can create a voucher from this screen itself.
Press Alt+C or click on C: Create Voucher to record a transaction for a selected cheque
number. The Payment Voucher Creation screen will appear, where you can record the
transaction.

Note: This opti on wi ll be hi ghli ghte d onl y i f che que s are sel ecte d.

 For cheques that are already used and are not a part of any cheque range, users can define
a Cheque Range in the Bank ledger, and can add these Cheque numbers to the new book
(Cheque Range) created using the Alt+R (R: Refresh Range) option.
Altering Cheque Status

To change the status of a cheque from Cheque Register:

 Select the Cheque Number and press Alt+A or click A: Alter Status.

 The status of Available cheques can be updated as Blank or Cancelled.

 The status of Cancelled Cheques can be changed to Available.

To update a cheque’s status as Blank,

 The options Use Reversing Journals & Optional Vouchers and Allow Zero valued
entries to Yes in F11: Features (F1: Accounting Features).

[Img-100]

 Select an Available Cheque Number and press Alt+A or click A: Alter Status.

 Select Blank Cheque from Cheque Status as shown:

[Img-101]

 You will be taken to Payment Voucher Creation screen as shown:

[Img-102]

 The voucher will be marked as Blank Cheque.

 User can change Voucher Number and Amount field. No other field is allowed to be
altered.

 If Amount field is left blank and the voucher is accepted, the status of the cheque in the
Cheque Register will be Blank.

 Once the value is entered in Amount field, the Blank Cheque tag will disappear. The status
of the cheque in the Cheque Register will be Unreconciled.

To update a Cheque's Status as Cancelled,

 Cancelling a Voucher will automatically change the Status of the Cheque(s) used in that
voucher to Cancelled.
 In case a new cheque has to issued for a transaction for which the issued cheque cannot be
used due to various reasons like - lost in transit, torn cheque etc., the previously used
Cheque has to be cancelled. You will have to follow the below procedure:

o Go to Voucher Alteration screen of the Cheque which has to be cancelled, and change
Cheque number

o In Cheque Register, the status of Cheque number which was changed, will be
under Available.

o Press Alt+A or click on A: Alter Status, and select Cheque Cancelled, give a Date on
which the Cheque was cancelled and enter the reason for cancellation in Remarks field.

[Img-103]

o Accept the screen. The Cheque’s status in the Cheque Register will be Cancelled.

To update a cheque’s status as Available,

 Select a Cancelled Cheque Number and press Alt+A or click A: Alter Status.

 A message - Reuse the Cancelled Cheque? will appear as shown:

[Img-104]
 Press Enter or click on Yes to reuse the Cancelled Cheque.

Configuring Cheque Register

To configure the Cheque Register,

Press F12 or click on F12: Configure, the Configuration screen will appear:

[Img-105]

Include Not in Range Cheques

The cheque numbers that are entered manually by the user and which do not belong to any Cheque
Range can be brought to the Cheque Register report by setting this option to Yes. This way all the cheques
used can be managed from a single place.

[Img-106]

Ignore the Completed Cheque Ranges

Cheque Books that are completely used, i.e., the Status of all the cheques is other than Available, can be
ignored while viewing Cheque Register by setting this option to Yes.

Show Book Name

Cheque Book Names defined in the Bank ledger can be viewed along with the Cheque Ranges by setting
this option to Yes. This way it is easier to identify the Cheque Ranges
Using Additional Cost of Purchase' in Tally.ERP 9
In many situations, more than one item is purchased where the expense incurred is charged as a lump-
sum amount. However, to give an effective cost including the expense to each of the items, additional
costs of purchase option is used. This process is automated and allocation of the expense to stock item
can be done on a predefined basis.
Note: The se e xpe nses poste d usi ng Addi ti onal cost on Purchase fe ature s, do not
affe ct the re le vant nomi nal l e dge r accounts but update the cost of the Stock Item, i .e .,
the addi ti onal costs i ncurre d are update d w i thout actuall y affe cting accounti ng, onl y the
stock val ue goe s up.

Enabling Additional Costs of Purchase

In F11: Features (F2: Inventory Features) under Purchase Management, set Track additional
costs of Purchase to Yes.

[Img-1]

The additional costs/ expenses incurred can be allocated to each item based on:

 Quantity

 Value

The following set-up activity is required to appropriate the additional costs:

 Alter the Parent Group of the expense ledger accounts, e.g. Indirect Expenses. (Go
to Gateway of Tally > Accounting Info > Groups >Alter > Direct Expenses).
 You will find a new option - Method to Allocate when used in Purchase Invoice.

 If you want to appropriate the ledger accounts under this group to stock items either by
Quantity or value, you must select the respective option. For ex: Select Appropriation by
Qty.

[Img-2]

Note: To ge t the opti on Method to Al l ocate when used i n Purchase Invoi ce ,

Enable Enter Purchases in Invoi ce in F11: Features (F1: Accounti ng Features)

Creating Purchase Entry

Purchase entry in As Voucher mode: The additional cost details have to be filled in after the
allocation of each purchase item.

While creating the Purchase Voucher, once after giving the Quantity and Rate in the Inventory
Allocations, press Enter button on the Amount column, Additional Cost Detailsscreen will be
displayed.
[Img-3]

Type of Cost

Select the expense ledger from the List of ledgers Accounts.

% age

Additional costs can be entered in terms of percentage also. For example, 1%, 2% etc. You can also skip
the percentage field to enter the amount directly.

Amount

You can enter the amount of additional cost directly or if the percentage is entered, then amount will be
calculated automatically.
Note: If the re are tw o or more i te ms, the n for i te ms, the ‘Addi ti onal Cost De tail s’
scre en wi ll be di spl aye d.
[Img-4]

Purchase entry in As Invoice mode: The treatment of additional costs on stock items is automated.

[Img-5]

Report on Additional Cost Details

The reports on appropriation of additional costs/ expenses can be viewed in the Stock Summary.

Go to Gateway of Tally > Stock Summary

[Img-6]

Let us consider as an example, the appropriation calculation for Item A.

Total of Expenses ledger = Rs. 200

Total of no of quantities = 30

Number of quantities of Item A = 10

200 / 30 * 10 = 66.66

Total amount + additional charges

1000 + 66.66 = 1066.67/-

Price Levels in Tally.ERP 9
In Tally.ERP 9, you can create different Price Levels and assign different Price Lists to these Price Levels.
For example, you can create Wholesaler, Distributor and Customer as Price Levels and assign applicable
Price Lists to these Price levels, as per your requirements, so that only the relevant prices and discount
rates are used during entry of orders and invoices. Before you start creating Price Lists, you may decide
to create Price Levels as required.

Creating Price Lists

Altering Price Levels

Altering Price Lists

Creating Price Levels in Tally.ERP 9

Ensure that whether the Company is enabled for Accounts with Inventory in the Company Master
screen.

To enable Price Levels, Set the following fields to Yes in F11: Features > F2: Inventory
Features screen.

1. Allow Invoicing (If you do not set this option to Yes, the options for Price Lists will not
be available.)

2. Set Use Multiple Price Levels to Yes.

[Img-57]

3. Type the name of the price levels to be created, in the Company Price Levels screen.

[Img-58]

4. Press Ctrl + A to accept the screen and return to the F11: Inventory Features screen. Set
the other options as required and accept Yesto save.
Altering Price Levels in Tally.ERP 9
This option allows you to alter the existing Price Levels.

To alter a Price Level,

Go to Gateway of Tally > F11: Features > F2: Inventory Features screen.

1. Tab down to Use Multiple Price Levels field and press Enter to go to Company Price
Levels screen.

Follow the same procedure as discussed in Creating Price Levels, to alter the name of a price level.
You can simply overwrite the names you specified previously and save the changes.

Price Lists in Tally.ERP 9

Price Lists are useful for orders and invoices. An up-to-date price list helps in decision-making even at the lower levels
the organization and quickens the sales process. Tally.ERP 9 assists in creating quantity based pricing with complex discou
structure. Price Lists are available only for inventory items and hence the feature is available only if inventory and invoic
are activated for the company.

You can have one or more price lists. You may require more than one price list, when you have different pr
structures/levels for different purposes viz., different groups of customers requiring different discounts or dealing in differe
products.

Tally.ERP 9 permits you to create any number of price lists, based on the Stock Group and Stock Category to match the structure
you need.

Go to Gateway of Tally > Inventory Info. > Price List

[Img-59]

Creating a Price List in Tally.ERP 9

Once you have created Price Levels, the Price List option appears in the Inventory Info. menu

Go to Gateway of Tally > Inventory Info. > Price List

[Img-60]

Creating Price List based on Stock Group

Go to Gateway of Tally > Inventory Info. > Price List > Stock Groups

 If you want to create a Price List consisting of all stock Items falling under different Stock Group
select Stock Groups from the Price List Menu.

[Img-61]

 Select a Stock Group Name from the List of Stock Groups.

[Img-62]

 Select the Price Levels from the list

Note: To view all the Stock Items under the selected Price Level, click on F12: Configure and set t
option Show all Items for Price Level to Yes.

 Type the applicable rates for the stock items for the selected Price Levels (you will notice that
the items grouped under Components appears under List of Items).
[Img-63]

 Accept to save

Under Group

This is the stock group of the Stock Item, for which you want to define the Price Lists.

Price Level

This is the Price Level under which the Price List needs to be created

Applicable From

This is the date from which the defined Price List is applicable.

The columns you see are as follows.

Sl. No

This column is auto-generated serial numbers to track the number of items in the Price List.

Name of Item

This column contains the Name of the Stock Items under the selected Stock group. You can define the Price L
for each item.

Quantities - From & Less Than

These fields are repeated for an item and begin with a blank for 0 items and end with a blank for any number
items (i.e., upto 50 Nos you can have a certain pricing if someone buys more than 50Nos you can specify
different rate). This is useful for quantity based pricing and discounts. You can create a staggered quant
price structure, if required.

If you do not require quantity based pricing, leave From and Less Than fields blank.
Rate

Under this column, you can specify Rate, the Rate for the item based on the quantity range given.

Discount % (if any)

You can define a discount percentage in the Price List which will be taken automatically in the sales invoic
you may also choose to maintain the same price for all bands, but define different discounts.

Historical Details (Rate and Disc%)

This column displays the last Price List specified for such Stock Group.

There are two columns: Rate and Disc %. Tally.ERP 9 provides the historical details of the sale rate a
discount percentage of any previously created Price Lists. Therefore, you can define the current price deta
based on the information given in the Historical details.

Cost Price

In this column, Tally.ERP 9 displays the cost price of the item calculated based on the stock valuation meth
given in the item master. This has been provided to assist the user in giving the appropriate sale price.
viewing the historical price details of an item, we can accordingly define the sale price for the new Price List.

Note: For the discount percentage to be taken in the Price List, you should activate the feature Separa
Discount Column on Invoices in the F11: Features (Inventory Features).

Buttons in Price Lists Screen

Ctrl+F4: New Parent

Select this option to change the parent Stock Group Name, Price Level from the List.

Creating Price List based on Stock Categories

Go to Gateway of Tally > Inventory Info. > Price List > Stock Categories

 If you want to create a Price List consisting of all stock Items falling under different Sto
Categories, select Stock Categories from thePrice List Menu.

[Img-64]

 Select a Stock Category from the List of Stock Categories.

 Select the Price Levels from the list

 Type the applicable rates for the stock items for the selected Price Levels
[Img-65]

Buttons in Price Lists Screen

Ctrl+F4: New Parent

Select this option to change the parent Stock Category Name, Price Level from the List.

Print/Export/Email/Upload Price Lists

Select the relevant buttons while the price list is displayed for it to be printed /

sent by e-mail or published.

Altering a Price List in Tally.ERP 9

This option allows you to view the existing Price List based on Stock Groups or Stock Category in edit
mode, here you are allowed to change the various information.

To alter a Price List based on Stock Groups,

Go to Gateway of Tally > Inventory Info. > Price List > Stock Groups

1. Select the required Stock Group Name from the List of Stock Groups.

2. Select the required Price Level from the List of Price Levels.

3. Change the Applicable From date, as required.

Follow the same procedure as discussed in Creating a Price List, to alter the Price Lists.
Note: Si mil arl y you can alte r the Pri ce Li st base d on Stock Category .

To vi e w al l the Stock Item s unde r the sel e cte d Pri ce Level , cli ck on F12:
C onf i gure and se t the option Show all Items f or Pri ce Level to Yes.

Assigning Price Levels to Ledger Accounts in

Tally.ERP 9
Once the Price Levels are created in Tally.ERP 9, a new option appears in Ledgers grouped under Sundry
Debtors and Sundry Creditors, with the help of which you can assign a specific Price Level to the ledger
account.
Go to Gateway of Tally > Accounting Info > Ledgers > Create

[Img-66]

You can choose the Price Level that you want to assign to the Ledger, by selecting the Price Level from
the Price Levels list in the Pricing Level Applicable field. Select Not Applicable, if you do not want
to assign any Price Levels to the Ledger.

If you want to assign Price Levels to ledgers created earlier, alter the ledger account, tab down
to Pricing Level Applicable field and select the applicable price level from the list.
Note: For a Le dge r, you ca n onl y assi gn / tag onl y one Pri ce Le vel at a ti me , how e ve r
you can change the Pri ce Level sele cti on de pe nding upon your re qui re me nt in al terati on
mode or duri ng Vouche r Entry.

Using Price Levels during Invoicing (Voucher Entry)

in Tally.ERP 9
The price levels created and assigned to Ledger Accounts automates Stock Item Prices and helps
minimizing errors during Invoicing.

Go to Gateway of Tally > Accounting Vouchers > F8: Sales

1. Select As Invoice.

[Img-67]

3. Accept to save

During Invoicing, there is an additional field Price Level enabled once Price Levels feature is activated
and is prefilled with the Price Level which are specified for the selected Party ledger and the cursor skips
this field.

You may change the Price Level during Invoicing by pressing F12: Configure and
setting Yes to Allow modification of ALL fields during entry.

Go to Gateway of Tally > F12: Configure > Invoice/Orders Entry

[Img-68]

Set Allow modification of ALL fields during entry to No to prevent changes made to prices. If you
set it to Yes, you can override the prices already defined.

Go to Gateway of Tally > Accounting Vouchers > F8: Sales

 Select As Invoice.

[Img-69]

Once the above configuration is enabled in F12: Configure, you will now be allowed to modify the Price
Levels for the selected Party Ledger during Invoicing.
Note: Tal l y.ERP 9 provi de s you fl e xi bil ty to se le ct ite ms wi th and wi thout the Pri ce Li st
i n the s ame invoi ce . For e xampl e , for the i te m w hich had the Pri ce Li st de fi ne d,
Tall y.ERP 9 took the de tai l s automati call y. Whe re as for the stock i te m w hi ch di d not
have a Pri ce Li st de fi ne d, Tall y.ERP 9 prompte d for the same .
Zero Valued entries are those entries where a voucher entry is made without any values, i.e., one of
the parameters (Qty or Rate) may not have a value but needs to updated in the records.
Example:
Zero-rated VAT or Exempt from Tax Account. You are permitted to make such an entry. The Exempt
Ledger account can be viewed for all Exempt Sales.
 The items which are given as Free Samples.
Note: Zero Valued entries are allowed only in Sales and Purchase vouchers only and are not available in
Receipt, Payment vouchers and journal vouchers.

Enabling Zero Value entry

Enabling Allow Zero valued entries in F11: Feature: F1:Accounting Features/ F2: Inventory Features.

Example: Create a Sales invoice with Zero Value entry.

In the above Snap shot you can make out that, if Item A is purchased, then Item B is free.
Even if the values are not mentioned, the quantities of Item B will be reduced from the stocks.

Using different Actual and Billed Quantities' in Tally.ERP 9

Sometimes, the goods purchased or sold may have difference in the Actual and the Billed
quantities due to the following reasons:

 Free scheme

 Rejected by the customer for defective quality

 Rounding off of the billing quantity (for e.g., in Textile industries, Cloth measuring 150.50
mtrs is actually delivered but bill is made for 150 mtrs)

Recording of Actual Quanties and the Billed Quanties are essential to get the accurate stock values and
sale/purchase value i.e., the Books of Accounts should be updated with the Billed quantities
and Stocks has to be updated only with the Actual Quantities. Tally.ERP 9 allows you to record both
these in different fields i.e., Billed and Actual Quantity separately in the same invoice.
Note: The Actual Quantity update s stock and the Bil l ed Q uanti ty affe cts the accounts
and thus show s the correct posi ti on of both Accounts as w el l as Inve ntory.

Set the option Use different Actual and Billed Qty to Yes in F11:Features:F2:Inventory Features.
[Img-9]

Purchase or Sales vouchers with Actual and Billed quantity will appear as shown.

[Img-10]

In the screen shown above, there are two columns under Quantity:

 Actual
 Billed

Once when quantities are entered under Actual and Billed, stocks will be reduced to the extent of Actual
quantities only.

Example:

A company gives 2 items free as a sample to the customer, when 10 items are purchased. Then
under Actual qty column 10 numbers will be entered and under Billed quantity 8 numbers will be
entered. In the stock summary 10 numbers will be shown under Outwards.
Job Costing in Tally.ERP 9
Job costing is a form of specific order costing, which applies to a job undertaken according to customer
requirements and specifications. Tally.ERP 9 enables the tracking of cost and revenue information down
to the smallest detail. With a view to ascertaining the actual costs incurred for each job, each job is
assigned a job number or Job name. Job costing systems then accumulate costs separately for each
product or service, based on the jobs undertaken, for each product or service.

Some of the examples of Job Costing are Interior Decoratoration, Construction, Architecture, Printing
etc.,

Use of Job Costing

 To determine the true cost for each job broken down by locations

 To determine the revenue and expenditure and therefore the profit associated with each job

 To track overhead costs by allocating them for each job

 To identify loss on projects at an early stage

Features of Job Costing in Tally.ERP 9

 It helps in accumulating Cost and Revenue for a particular Job / Project.

 It allows tracking transfers of materials from one godown to another.

 It allows tracking of consumption of materials at different locations.

 It ascertains profitability i.e., Net Profit / Loss for a particular Job / Project.

 It provides summary of inventory movements (Opening, Inwards, Outwards , Transfer,

Consumption etc.)

 Allows comparison of each element of cost, selling price and profit with other jobs in single
screen

 Allows drill down till voucher level for any kind of alteration or reference

Enabling Job Costing in Tally.ERP 9

The Job Costing feature in Tally.ERP 9 is used to track all the incomes and expenses for a project. Each
project or job is created as a Cost Centre. The Cost Centres and Inventory Options (Maintain Multiple
Godowns) are integrated in Tally.ERP 9 to enable Job Costing, if the company maintains Accounts with
Inventory features. For companies that maintain Accounts Only, the Job Costing feature will not be
available.

To enable Job Costing:

Go to Gateway of Tally > F11: Company Features ( F1: Accounting features)

1. Set Maintain Cost Centres and Use Cost Centre for Job Costing to Yes.

[Img-1]

2. Set Maintain Multiple Godowns to Yes in F11: Company Features (F2: Inventory
Features).

3. Click Accept to save.

[Img-2]
Note: For compani e s, that Mai ntai n Accounts onl y , the Job Costi ng fe ature wil l not be
avai lable .

Creating Masters for Job Costing in Tally.ERP 9

Creating masters for Job Costing is similar to creation of other ledgers. The masters for job work
analysis are:

1. Cost Centres for Job Costing

2. Godowns dedicated to specific jobs

3. Stock Items

4. Customer and Supplier ledgers

5. Sales and Purchase ledger accounts

6. Expenses and Income Accounts

7. Stock Journal Voucher class

 Transfer voucher class

 Consumption voucher class

Creating Cost Centres for Job Costing in Tally.ERP 9
Creating Cost Centres for Job Costing is similar to creation of other Cost Centres. Refer Cost Centres
for additional Information.

Go to Gateway of Tally > Accounts Info > Cost Centres > Create

1. Enter the name of the Cost Centre in the Name field. Eg: Project 1.

2. In the Under field select Primary from the List of Options.

3. Set the option Use for Job Costing to Yes. This cost centre will then be available in the
drop down for the Job Work Analysis report.

4. Click Accept to save the settings.

[Img-3]

Creating Godowns for Job Costing in Tally.ERP 9

For creating Project / Job Location use Godown Creation.

Once Godown is allocated to the Job/Project, it is taken into account that all the materials issued or
received for that particular Job/Project and will reflect in the reports. It is always advised to create
separate godowns for each Job/Project.

Go to Gateway of Tally> Inventory Info. > Godowns > Create

1. In the Godown Creation screen, Allow Storage of Materials is automatically set to Yes.
Ex: Bangalore.

2. An additional field Set Job/Project Name for Job Costing is displayed. Press the
spacebar in the field and the list of Cost Centres for which Use for Job Costing was set to
yes is displayed in the List of Cost Centres sub-screen.

3. Select the Cost Centre to which the Godown is associated.

4. Click Yes to Save.

[Img-4]

Note: Re fe r Cre ate a Location for more de tai ls on Cre ating Godow n. Whe n the
Godow n i s confi gure d for J ob Work cursor w i l l not move to Use for se cti on.

Creating Ledgers for Job Costing in Tally.ERP 9

Creating Ledgers for Job Costing is similar to that of other Ledgers. Refer Ledgers for additional
information.

Creating Job Costing Party Ledgers

Create party accounts for our Customers under Sundry Debtors. For e.g. you can create a Ledger for a
Bangalore customer and one for a Chennai customer. Similarly create your Suppliers under Sundry
Creditors.

Creating Sales and Purchases Ledgers

Create Sales Ledgers under Sales Accounts and Purchase Ledgers under Purchase Accounts. Ensure that
the field Cost Centres are applicable? is Yes for the Ledgers you want to include in Job Costing.

Creating Income and Expenses Ledgers

Create Income Ledgers such as Project Inspection Charges etc. under Direct Income. Expense ledgers
such as Transportation Charges, Project Site Rent, and so on can be created under Direct Expenses.
Staff Welfare, Telephone Charges etc. can be created under Indirect Expenses as required by your
project. Ensure that the field Cost Centres are applicable? is Yes for all the Ledger Accounts you want to
include in Job Costing.

Creating Stock Journal Voucher class in Tally.ERP 9

Stock Journal classes allow you to handle transfers from one location (Godown) to another, for
companies having Multi-Location Inventory and at least two locations/Godowns created. It also allows
you to track transfer of materials for consumption.
Note : Re fe r to Voucher Classes for Stock Journals for ad di ti onal i nformati on.

Go to Gateway of Tally > Accounting Info or Inventory Info > Voucher Types > Alter > Stock
Journal > under ‘Name of Class’ give the name as ‘Transfer’:

[Img-5]

1. Below ‘Transfer - Name of Class’ give the name as ‘Consumption’.

[Img-6]

The Stock Journal Voucher screen, which contains both Transfer and Consumption voucher class
is displayed as shown.

[Img-7]

Creating Purchase Vouchers in Tally.ERP 9

If you would like to allocate the Cost Centers, then enter purchase voucher in As Voucher mode as the
Cost Allocation sub-screen does not appear in the As Invoice mode, else enter purchase voucher in As
Invoice. In the purchase entry it is not necessary to allocate to Job Costing for Job Cost reporting.

Go to Gateway of Tally > Accounting Vouchers

1. In the Voucher Creation screen select F9: Purchase.

2. Select As Invoice.

3. Enter the current date and reference.

4. Select the Party to be credited from the List of Ledger Accounts in Party’s A/c name.

5. Select the required Purchase Ledger from the List of Ledger Accounts.

6. Select an item from the Stock Items List of Items.

On selecting the Item, an Item Allocations sub screen for the selected Item is displayed as shown.

[Img-8]

7. Select the Godown under the Godown field and specify the quantity to be allocated under
the Quantity field.

8. Enter the Quantity and Rate, and the amount is automatically displayed in the Amount field.

9. Select another Godown and follow the similar procedure for Item allocation.

10. Select the Items to be purchased.

11. Enter Narration if required and accept to save

Note : In the J ob Work An al ysis re port, purchase amount w il l be show n i n the inw ards
col umn.
[Img-9]

Creating Stock Journal Vouchers for Job Costing in

Tally.ERP 9
Inter Project Transfer Entry:

For Inter Project / Site Transfer, use Stock Journal with Transfer Class.

Go to Gateway of Tally > Inventory Vouchers > press Alt+F7

[Img-10]

[Img-11]

1. Select the Godown from the List of Godowns, to where Items are to be transferred.

2. Select the item from the List of Items.

3. Select the Godown from the List of Godowns, from where goods are transferred.

4. Enter the Quantity and Rate, Amount will be displayed automatically.

5. Enter the Narration, if required.

Consumption Entry:

For consumption of material, use Stock journal voucher with Consumption Class.

Go to Gateway of Tally > Inventory info > press Alt+F7 > select Consumption under Class.

[Img-12]

[Img-13]

1. Enter the Date as current date or as required.

2. Select the stock Items from the ‘List of Items’ screen.

3. Select the Godown from which the items are to be consumed.

4. Enter the Quantity and Rate. The amount is automatically displayed in the Amount field.

5. Enter the Narration if required.

Note: Thi s Consumpti on Amount w il l be show n unde r ‘consumpti on’ col umn i n the Job
Work Anal ysi s Re port.

Other Transfers:

When materials are transferred from one godown to another (Godown tagged to the Job Costing)
without selecting the voucher class (Classes created for ‘Transfer’ and‘Consumption’), it will be taken
under ‘Other Transfers’ in the Job Work Analysis report.

[Img-14]

Creating Manufacturing Journal for Job Costing in

Tally.ERP 9
Job Work Analysis report will also take into consideration of a product produced by
passing Manufacturing Journal voucher.

Creating Manufacturing Voucher Type

Go to Gateway of Tally > Accounts Info or Inventory Info > Voucher Types > Create

1. Under Name type Manufacturing Journal.

2. Under Type of Voucher select Stock Journal.

3. Set Use as a Manufacturing Journal to Yes.

[Img-15]

Creating Bill of Materials:

In the item master creation screen (Building), press F12: Configure (Stock Item Configuration) and
set Allow component list details ( Bill of Materials) to Yes.

[Img-16]

Accept to save the screen.

Now In the Item master creation screen, set Set Components List to Yes
[Img-17]

Then the Stock Item Multi Components (M BOM) screen will be displayed. In Name of BOM specify
the BOM Name

[Img-18]

Press Enter from Name of BOM to view Stock Item Components (BOM) screen. The
completed component list is displayed as shown
[Img-19]

Go to Gateway of Tally >Inventory Vouchers > press Alt+F7 > select ‘Manufacturing
Journal’ under Voucher Type.

[Img-20]

Passing Manufacturing Journal

[Img-21]

1. Select the Product under Name of Product.

2. Select the appropriate Godown (Job/Project).

3. Enter the quantity.

4. Sub-Component items will be displayed automatically.

5. Enter the Addl.cost, if any.

6. Enter the Narration.

Creating Journal Vouchers for Job Costing in

Tally.ERP 9
Even Journal Vouchers could be used to allocate the receipts and payments for Job/Projects.
Note: In the J ournal Vouche r scre e n, e nable the option Al l ow Cash Accounts in
Journal s i n F12: C onf i gurati on scree n.
[Img-22]

Creating Payment Vouchers for Job Costing in

Tally.ERP 9
Go to Gateway of Tally > Accounting Vouchers

1. In the Voucher Creation screen select F5: Payment.

2. Enter the date and reference.

3. Select the Bank Account or Cash Account from where payment has to be made.

4. Select the Expense Ledger Account created and enter the amount to be debited.

5. The Cost Allocations sub-screen appears. If the payment has to be allocated to more than
one Cost Centre, select the Cost Centres and allocate the corresponding amount.

6. Enter Narration if required and accept to save.

[Img-23]

Similarly, the expenses related for a particular project could be accounted by tagging to the respective
Job/Projects.

Creating Sales Voucher for Job Costing in Tally.ERP 9

Go to Gateway of Tally > Accounting Vouchers

1. In the Voucher Creation screen, select F8: Sales.

2. Select As Voucher.

Note: You can cre ate an Item Invoi ce or an Account Invoi ce and al l ocate appropri ate
Cost Ce nters or J ob/ Proje ct and al so sale s can be create d - As Voucher or As Invoi ce

3. Enter the date and reference.

4. Select the appropriate Customer in the Party’s A/c Name.

5. Enter the amount in the Amount field.

6. Select the Sales ledger from the List of Ledger Accounts.

7. In the Cost Allocations sub screen, select the Cost Centre from the List of Cost Centres under
the field Name of Cost Centre and enter the amount to be allocated to that Cost Centre.

8. Enter Narration if required and accept to save.

[Img-24]
Note: Whe n sale s i s cre ated as Item Invoi ce , thi s de tail s i s avail abl e unde r Cost of
Sal es i n the Job Work Anal ysi s - Consumpti on report .

Job Costing Reports in Tally.ERP 9

Job costing report enables the user to know the Net Profit/Loss for the selected re the reports available
in Job Work Analysis.

The following reports are available for Job Costing :

 Job Work Analysis

 Material Consumption Summary

 Comparative Job Work Analysis report

Job Work Analysis Report in Tally.ERP 9

Go to Gateway of Tally > Display > Statement of Inventory > Job Work Analysis
[Img-25]

Job Work Analysis report is displayed as shown:

[Img-26]

Detailed view:

Press Alt+F1 in the Job Work Analysis report, to view a detailed report.
[Img-27]

Detailed view with percentage:

Press F12 in the Job Work Analysis report, and set Show Percentage to Yes.

[Img-28]
[Img-29]

Materials Consumption Summary Report in Tally.ERP

9
To view the Material Consumption Summary report, scroll down to the line Consumption in Job Work
Analysis Report and press Enter.

The Material Consumption Summary report is displayed.

[Img-30]

Here it will display Opening Value, Inward Value, Consumption, Other Transfers and Closing
Value.

[Img-31]

It will display the Godown of the particular Job/Project:

Detailed view of Inward Value, Consumption and Other Transfers:

Press F12 and set Show goods inwards in detail, Show goods Consumption in detail and Show
goods outwards in detail to Yes.
[Img-32]

Material Consumption Summary will appear as below:

[Img-33]

Further drill down from Material Consumption Summary to Material Consumption Stock
Summary, would enable the user to view the Stock Group:

[Img-34]

This Report displays the material consumed for the Job/Project. Details of Opening value, Inward Value,
consumption, other transfers and Closing value is shown – Drill down:

Opening Value: Opening Balance of the items which are tagged to the Godowns (Job/Project) is
displayed here.
Inwards:

 Purchase: The value of the materials which are purchased for the project is displayed here.

 Manufacturing Journal: The value of the materials which are produced by passing
Manufacturing Journal voucher tagging to the appropriate godown, is displayed here under
Inwards.

 Inter Project Transfer: The value of the transfer entry which is made by
using ‘Class’ created for ‘Stock Journal’ and tagging to the appropriate godown is displayed
here.

 Other Transfers: Transfer of materials which are done by NOT using

the ‘Transfer Class’ created for Stock Journal would appear here.

Consumption:

 Cost of Sales: The Value of Cost of Sales will be displayed here. Cost of Sales is nothing
but Number of quantities (Sold) x Cost of Purchase. Sales which is made by usingItem
invoice will appear here.

 Job Consumption: The value of the entries which are made using ‘Consumption Class’
create for Stock Journal is displayed here.

Outwards:

 Manufacturing Journal: The value of the materials which are used\ consumed for a
Job/Project in the manufacturing journal voucher entry is displayed here.

 Inter Project Transfer: The value of the transfer entry which is made by
using ‘Class’ created for ‘Stock Journal’ and tagging to the appropriate godown is
displayed here.

 Other Transfers: Transfer of materials which are done by NOT using

the ‘Transfer Class’ created for Stock Journal would appear here.

Closing Value:

Closing value of an item will be determined based on costing method.

Closing value = Opening Value + Inwards – Consumption – Other Transfers

Drill down from the above report, will display the Stock items used for Job/Project
[Img-35]

Drill down further to display the Godown Voucher screens.

[Img-36]

It displays the report godown wise - Inwards, Outwards and Closing Balance.

To view total material consumption of all the Job/Projects

The button Auto Column is available to view all the Job/Projects material consumption report in one
sheet. Press Alt+N.

[Img-37]

[Img-38]

For comparison of one Job/Project material consumption with other Job/Project.

The button New Column is also available in the report to view the period for a particular period that
can be selected from the list – Press Atl+C

[Img-39]

[Img-40]

Viewing other Job/project from the screen on one Job/Project:

The button Alter Column is also available in the report to view the other job or Project. Press Alt+A

[Img-41]

[Img-42]

F4 button:
Click this button to select the other Job/Project from the list.

F7: Button or Show:

Profit button is available in the Material Consumption Stock Summary report, to view the Gross
Profit with Percentage for a particular Job/Project.

[Img-43]

Comparative Job Work Analysis report in Tally.ERP 9

To view multiple Job/Projects.

The Job Work Analysis report supports details of Multiple Jobs in a single report. All these details are
viewed as different columns with the help of New Column button. Alt+N

[Img-44]

Comparative Job Work Analysis report will be displayed as shown:

[Img-45]

Comparison of one Job with another Job:

The button Auto Column is available in the report to view the period for a particular period that can be
selected from the list. Refer Modify Reports for adding, deleting and altering columns. Press Alt+C.

[Img-46]

Job Work Analysis report will appear as below:

[Img-47]

Viewing any other Project/Job from the existing project Job Work Analysis report:

The button Alter Column is also available in the report to view the other job or Project Alt+A

[Img-48]

Job Work Analysis report will appear as shown:

[Img-49]
Press F4 button, to select the other Job/Project from the list.

[Img-50]

It allows the user to drill down from Job Work Analysis report to voucher entry, to view a break up of
Job/Project.
Job Order Processing' in Tally.ERP 9

Job Work Out Order

When the principal company intents to manufacture or process goods, raises a Job Work Out Order on
Job Worker to process the order. The Job Work Out order contains the Ordered Item, Quantity, Rate
and the Amount. It allows to define the BoM for the ordered item. It also contains the despatch details,
the process instruction with regard to duration and nature of process along with the Job Work Out Order
Number.

Tally.ERP 9 allows the principal company to have track of raw materials sent and finished/processed
materials received. It provides reports on Orders/Components Outstandings, Material
Movements, Stock availability with Job Workers, Stock ageing analysis and Analysis on Job Work such
as Issue and Receipt Variance.

To enable Job Order Processing refer Enabling Order Processing in Tally.ERP 9.

Job Work In Order

When the job worker receives an order from the principal company to manufacture or process goods,
raises a Job Work In Order on the Job Order received. The Job Work In order contains the Ordered Item,
Quantity, Rate and the Amount. It allows to define the BoM for the ordered item. It also contains the
despatch details, the process instruction with regard to duration and nature of process along with the
Job Work In Order Number.

Tally.ERP 9 allows the job worker have track of raw materials received and finished/processed materials
sent. It provides reports on Orders/Components Oustandings, Material Movements, Stock availability
with Job Workers, Stock ageing analysis and Analysis on Job Work such as Issue and Receipt Variance.

To enable Job Order Processing refer Enabling Order Processing in Tally.ERP 9.

Creating a Job Work Out Order' in Tally.ERP 9

This voucher allows the principal company to raise Job Orders on Job Worker.

Creating a Job Work Out Order

Altering and Deleting a Job Work Out Order

Creating a Job Work Out Order

To create a Job Work Out Order,

Go to Gateway of Tally > Order Vouchers > press Alt + J or click on J: Job Work Out Order.
[Img-5]

Party's A/c Name

Select the Supplier’s (Job Worker) name from the List of Ledger Accounts. Use Alt + C to create a
new account.

The Party Details screen is displayed. Provide the details as shown.

[Img-6]

Order No

Enter the Job Work Out Order Number under Order No column.
Name of the Item

Select the Stock Item for which order is placed, from the List of Stock Items. The Item
Allocations sub-screen is displayed. Enter the details as shown.

Track Components

Set the option to Yes if components need to be tracked.

Due On

Enter the due date for receipt of the items. This monitors outstanding receipts.

If orders are split for different dates, then specify the due date for the first lot to be received, after
selecting the quantity, rate and amount; specify the due date for the second lot and so on. After
specifying the due dates for all the lots, press Enter in the Due on field to return to the Voucher
Creation screen.

Godown

Select the required Godown from the list.

Note: The Godown sel ecte d i n Item Al l ocati on shoul d not be e nabl e d wi th opti ons Our
Stock wi th Thi rd Party and Thi rd Party Stock wi th us i n Godow n maste rs.

Quantity, Rate and Amount

Enter the ordered quantity of the item and its rate. The amount will be calculated automatically.

In case Track Component is set to Yes, the Component Allocation screen is displayed when
the Quantity is entered, as shown:
[Img-7]
Note: The C om ponents All ocati on di spl ays the l ist of compone nts spe ci fi e d i n
the O rdered Item master.

 Accept to Save.

Narration

This field is optional. Enter the required particulars concerning the order.

For more details on F12 configuration refer Invoice / Order Entry

Altering and Deleting a Job Work Out Order

To alter a Job Work Out Order,

Go to Gateway of Tally > Display > Day Book

Go to Gateway of Tally > Display > Job Work Out Reports > Job Work Registers > Job Work
Out Orders Book

Make the necessary alterations and save.

Deleting a Job Work Out Order

To delete a Job Work Out Order, press Alt + D in the Job Work Out Order alteration screen.

Creating a Job Work In Order' in Tally.ERP 9

This voucher allows the Job Worker to raise receipt of Job Order from the Principal
Company.

Creating a Job Work In Order

Altering and Deleting a Job Work In Order

Creating a Job Work In Order

To create a Job Work In Order,

Go to Gateway of Tally > Order Vouchers > press Alt + W or click on W: Job Work In Order.
[Img-5]

Party's A/c Name

Select the Customer's (Principal Company) name from the List of Ledger Accounts. Use Alt +
C to create a new account.

The Party Details screen is displayed. Provide the details as shown in Job Work Out Order.

Order No

Enter the Job Work In Order Number under Order No column.

Name of the Item

Select the Stock Item for which order is received, from the List of Stock Items. The Item
Allocations sub-screen is displayed. Enter the details as shown.

Due On

Enter the due date for delivery of the items. This monitors outstanding deliverables.

If orders are split for different dates, then specify the due date for the first lot to be
delivered, after selecting the quantity, rate and amount; specify the due date for the second
lot and so on. After specifying the due dates for all the lots, press Enter in the Due on field to
return to the Voucher Creation screen.
Godown

Select the required Godown from the list.

Note: The Godown selected should not be enabled with options Our Stock with Third
Party and Third Party Stock with us in Godown masters.

Quantity, Rate and Amount

Enter the ordered quantity of the item.

In case Track Component is set to Yes, the Component Allocation screen is displayed when
the Quantity is entered, as shown:

[Img-6]

Note: The Components Allocation displays the list of components specified in

the Ordered Item master.

 Accept to Save.

Narration

This field is optional. Enter the required particulars concerning the order.

For more details on F12 configuration refer Invoice / Order Entry

Altering and Deleting a Job Work In Order

To alter a Job Work In Order,

Go to Gateway of Tally > Display > Day Book

Go to Gateway of Tally > Display > Job Work In Reports > Job Work Registers > Job Work In
Orders Book

Make the necessary alterations and save.

Deleting a Job Work In Order

To delete a Job Work In Order, press Alt + D in the Job Work In Order alteration screen.

Viewing Order Position' in Tally.ERP 9

To view the order position in Stock Summary,

Go to Gateway of Tally > Stock Summary

 Press Alt + F1 (For detailed view)

 Press Alt + N > Select Orders & Stock Details

[Img-7]

Orders & Stock Details screen is displayed as shown.

[Img-8]

 In the Stock Summary screen, you can add a new column using Alt + C.

[Img-9]

 Sales Order Reports can be accessed through Alt + F7 or Alt + C of the Stock Summary.

Viewing Purchase or Sales Order Outstanding

Go to Gateway of Tally > Stock Summary > Press F9 > select Purchase or Sales Order
[Img-10]
Note: Inventory Reports and Accounti ng Reports can al so be acce sse d
through ALL othe r re ports by pre ssi ng F9 or F10 (Accounti ng/ Inventory Reports) .
Job Order Processing' in Tally.ERP 9

Job Work Out Order

To enable Job Order Processing refer Enabling Order Processing in Tally.ERP 9.

Job Work In Order

To enable Job Order Processing refer Enabling Order Processing in Tally.ERP 9.

Creating a Job Work Out Order' in Tally.ERP 9

This voucher allows the principal company to raise Job Orders on Job Worker.

Creating a Job Work Out Order

Altering and Deleting a Job Work Out Order

Creating a Job Work Out Order

To create a Job Work Out Order,

Go to Gateway of Tally > Order Vouchers > press Alt + J or click on J: Job Work Out Order.
[Img-5]

Party's A/c Name

Select the Supplier’s (Job Worker) name from the List of Ledger Accounts. Use Alt + C to create a
new account.

The Party Details screen is displayed. Provide the details as shown.

[Img-6]

Order No

Enter the Job Work Out Order Number under Order No column.
Name of the Item

Select the Stock Item for which order is placed, from the List of Stock Items. The Item
Allocations sub-screen is displayed. Enter the details as shown.

Track Components

Set the option to Yes if components need to be tracked.

Due On

Enter the due date for receipt of the items. This monitors outstanding receipts.

Godown

Select the required Godown from the list.

Note: The Godown sel ecte d i n Item Al l ocati on shoul d not be e nabl e d wi th opti ons Our
Stock wi th Thi rd Party and Thi rd Party Stock wi th us i n Godow n maste rs.

Quantity, Rate and Amount

Enter the ordered quantity of the item and its rate. The amount will be calculated automatically.

 Accept to Save.

Narration

This field is optional. Enter the required particulars concerning the order.

For more details on F12 configuration refer Invoice / Order Entry

Altering and Deleting a Job Work Out Order

To alter a Job Work Out Order,

Go to Gateway of Tally > Display > Day Book

Go to Gateway of Tally > Display > Job Work Out Reports > Job Work Registers > Job Work
Out Orders Book

Make the necessary alterations and save.

Deleting a Job Work Out Order

To delete a Job Work Out Order, press Alt + D in the Job Work Out Order alteration screen.

Creating a Job Work In Order' in Tally.ERP 9

This voucher allows the Job Worker to raise receipt of Job Order from the Principal
Company.

Creating a Job Work In Order

Altering and Deleting a Job Work In Order

Creating a Job Work In Order

To create a Job Work In Order,

Go to Gateway of Tally > Order Vouchers > press Alt + W or click on W: Job Work In Order.
[Img-5]

Party's A/c Name

Select the Customer's (Principal Company) name from the List of Ledger Accounts. Use Alt +
C to create a new account.

The Party Details screen is displayed. Provide the details as shown in Job Work Out Order.

Order No

Enter the Job Work In Order Number under Order No column.

Name of the Item

Select the Stock Item for which order is received, from the List of Stock Items. The Item
Allocations sub-screen is displayed. Enter the details as shown.

Due On

Enter the due date for delivery of the items. This monitors outstanding deliverables.

Select the required Godown from the list.

Note: The Godown selected should not be enabled with options Our Stock with Third
Party and Third Party Stock with us in Godown masters.

Quantity, Rate and Amount

Enter the ordered quantity of the item.

In case Track Component is set to Yes, the Component Allocation screen is displayed when
the Quantity is entered, as shown:

[Img-6]

Note: The Components Allocation displays the list of components specified in

the Ordered Item master.

 Accept to Save.

Narration

This field is optional. Enter the required particulars concerning the order.

For more details on F12 configuration refer Invoice / Order Entry

Altering and Deleting a Job Work In Order

To alter a Job Work In Order,

Go to Gateway of Tally > Display > Day Book

Go to Gateway of Tally > Display > Job Work In Reports > Job Work Registers > Job Work In
Orders Book

Make the necessary alterations and save.

Deleting a Job Work In Order

To delete a Job Work In Order, press Alt + D in the Job Work In Order alteration screen.

Viewing Order Position' in Tally.ERP 9

To view the order position in Stock Summary,

Go to Gateway of Tally > Stock Summary

 Press Alt + F1 (For detailed view)

 Press Alt + N > Select Orders & Stock Details

[Img-7]

Orders & Stock Details screen is displayed as shown.

[Img-8]

 In the Stock Summary screen, you can add a new column using Alt + C.

[Img-9]

 Sales Order Reports can be accessed through Alt + F7 or Alt + C of the Stock Summary.

Viewing Purchase or Sales Order Outstanding

Creating a Manufacturing Journal Voucher Type in

Tally.ERP 9
In Manufacturing/Assembling organisations, there are number of components that go into the manufacturing/
assembling of finished Goods. Once, the Bill of materials is created, you can use Manufacturing Journal and
specify the quantity of finished goods that are to be manufactured.

To create a Manufacturing Journal Voucher Type,

Go to Gateway of Tally > Inventory Info. > Voucher Types > Create
[Img-73]

Name

Enter the name of the Voucher for ex: Manufacturing Journal

Type of Voucher

Select Stock Journal from the List of Voucher Types

Method of Voucher Numbering

You can select the method of voucher numbering as required.

Use Advance Configuration

Enable the options as required.

For more details refer Creating a Voucher Type with Advanced Configuration

Use a Manufacturing Journal

Set this option to Yes. Once this option is set to Yes, you will be able to record Manufacturing Journal.

You can also alter the existing Stock Journal Voucher type and set Use as a Manufacturing
Journal to Yes.

Go to Gateway of Tally > Inventory Info > Voucher type > Alter > Stock Journal
Note : O nce the Stock J ournal is al te re d to e nable the opti on Use as a Manuf acturi ng
Journal , all stock journal vouche rs wi ll be tre ate d as Manuf acturi ng journal s.
Transfer Journal Voucher' in Tally.ERP 9
Tally.ERP 9 allows you to transfer materials from one Godown to another. The transfer of materials is
done using the Transfer Journal Voucher.

To create Stock Journal for Inter - Godown Transfers,

Go to Gateway of Tally > Inventory vouchers > Alt+F7 for Stock Journal and select the class.

[Img-27]

 Pass the stock transfer entry.

[Img-28]

Printing Stock Transfer Voucher

Press Alt+P to print the Stock Transfer Journal Voucher

[Img-29]

F12: Print Configuration

[Img-30]

While printing Stock Transfer Voucher, set the options Destination Godown on Top of Voucher and Print
Godown Address to Yes.

 Enabling the option Destination Godown on Top of Voucher will display

the Destination Godown name on the top of the voucher instead of printing as separate
rows

 Enabling the option Print Godown Address will display the godown address as mentioned
in the Godown Creation/Alteration screen
[Img-31]

In case, where you don't have By-Product/Co-product/scrap details, then you can configure the

Manufacturing Journal to skip the movement of cursor to that section.

In F12: Configure (Stock Journal Configuration)

 Set the option Skip Co-Product/By-Product/Scrap Stock Item to Yes

[Img-26]

Note : When the opti on Ski p Co- Product/ By - Product/ Scrap Stock Ite m i s band the user i s
recordi ng a Manufacturi ng J ournal f or a stock ite m f or whi ch the BO M i s created by capturi ng
the detai l s of By- Product/ Co - Product/ Scrap ; then Tal l y.ERP 9 wil l i gnore the confi gurati on
and wi l l capture the detai l s of By - Product/ Co - Product/ Scrap. It wi ll al so al l ow to
m odi f y the detai l s i n By - Product/ C o - Product/ Scrap secti on.

Manufacturing Journal Voucher' in Tally.ERP 9

Go to Gateway of Tally > Inventory Vouchers > Alt +F7 > select Manufacturing Journal

For more information on creating Manufacturing Voucher type refer Creating Manufacturing Journal.

[Img-25]

Name of Product

Select the product which needs to be manufactured from the List of Items. The Item selected in Name of
Item field will be the primary Item which will be manufactured using different components.

BOM Name

Select the Bill of Material if you want the components utilised to manufacture the finished goods to be
displayed automatically.
Note: If BO M i s se le cte d the Components use d for the manufacture of fi nishe d goods &
the By-Products/C o -Prod ucts or Scrap produce d du ri ng manufacturi ng w il l be
de faul te d.

For more details on creating BOM & recording Manufacturing Journal using BOM refer the topic -
Creating Bill of Materials for a Stock Item

Godown

Select the godown where you would like to place the produced goods.

Quantity

Enter the quantity to be produced.

% of Cost Allocation

This field displays the Percentage of Cost of Allocation to the Primary Item manufactured.
Note: In a manufacturing proce ss i f the re are no by - Products/ co - products or scrap
produce d the n the % of Cost of All ocati on to Pri mary Item wi ll 100%.

If the re are any by-products/Co-products or scra p i s manufacture d the n the % of

C ost of Al l ocati on to primary i te m wil l be Total Cost - Cost al l ocated to By Products
/C o Products /Scrap.
Batch Name, Mfg Date, Expiry

If the item to be manufactured in batches then enter the Batch Name, Manufacturing Date and Expiry Date.

Components (Consumption)

The list of Sub-Component items which will be used to produce the finished goods, need to be selected
here.

1. Name of Item: In this field select the components used for the manufacture of finished
goods.

2. Godown: In this field select the Godown from where the components are consumed for
production.

3. Quantity: In this field mention the Quantity of Raw materials required to manufacture the
finished goods.

4. Rate: In this field mention the rate (purchase cost) of the raw materials used in the
manufacture of finished goods

5. Amount: In this field the Amount will be calculated automatically based

on Quantity & Rate of item

Co-Products/ By-Products /Scrap

The list of By-products/ Co-products or Scrap produced during the manufacture of finished goods need
to be selected here

1. Name of Item: In this field select the By-product/Co-product/Scrap name which is

produced in the process of manufacture of finished goods

2. Godown: Select the godown where the By-product/Co-product/Scrap produced will be

stored

3. % of Cost Allocation: In this field specify the % of cost of allocation to be made towards
the By-product/Co-product/Scrap produced

4. Quantity: In this field mention the Quantity of By-product/Co-product/Scrap produced

5. Rate: This is the rate of producing of By-product/Co-product/Scrap. (Rate =

Amount/Quantity) Rate will be displayed automatically

6. Amount: Amount will be displayed automatically based on the % of Cost

Allocation defined for the By-product/Co-product/Scrap produced. Tally.ERP 9 calculates
the % of Cost Allocation on Effective Cost

In the above example: Amount of By-Product 1(5,050) = 20,20,000 (Effective Cost) X

0.25\100 (% of Cost Allocation)

Cost of Components

This field displays the total cost of the components (raw materials) used in the manufacture of finished
goods.

Type of Addl. Cost

Enter the additional cost incurred for manufacturing the finished goods, if any.

Total Addl. Cost

The total of all additional cost will be displayed here.

Effective Cost

The Effective cost is total of Cost of Components (Consumption) + Additional Cost incurred to
manufacture the finished goods & Co-Product/By-product or Scrap

In the above example: 20,00,000 + 20,000 = 20,20,000 is incurred manufacture Item B (Primary
Item), By-Product 1 & Scrap

Allocation to Primary Item

The cost allocated to manufacture the Primary Item will be displayed in this field.

Allocation to Primary Item = Effective Cost - Total cost of Co-products/By-Products/Scrap

Effective Rate of Primary Item

This is the rate of the Primary Item Manufactured (finished item).

In the above example: 20,08,890 / 2000 (number of Item B produced) = 1004.45/nos.

Manufacture of Finished Goods without By-Product/Co-Product/Scrap

In some manufacturing processes, only finished goods will be produced without any By-product/Co-
product/scrap. In those cases, users may not need the provision to move to By-Product/Co-
product/scrap section. You can configure the movement of cursor to By-Product/Co-product/scrap
section.
Enabling TDS
To get started, you have to enable the Tax Deducted at Source (TDS) module in
Tally.ERP 9 and enter your company's registration details.

To enable TDS

1. Go to Gateway of Tally > F11: Features > Statutory & Taxation.

2. Set Enable Tax Deducted at Source (TDS) to Yes in the Company Operations
Alteration screen.

The Company Operations Alteration screen appears as shown below:

3. Enable the option Set/alter TDS details? to display TDS Deductor

Details screen.

4. Enter the TAN registration number.

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5. Enter the Tax Deduction Account Number (TAN).

6. Select the Deductor Type.

7. Enter Deductor branch/division.

8. Enable the option Set/alter details of person responsible?. to display

the Person Responsible Details screen.

o Enter the details as shown below:

o Press Enter.

9. Enter the Rate of TDS if PAN not available.

10. Enable the option Ignore IT Exemption Limit for TDS Deduction?, if required.

11. Enable the option Activate TDS for stock items?, if required.

The TDS Deductor Details screen appears as shown below:

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12. Press Enter.

13. Press Ctrl+A to save the details.

Configuring TDS
You can make many other configurations in your Company related to TDS, such as
configuration for displaying collector types, enabling surcharge details, and showing
alternate contact details.

Show All Deductor Types

Enable Surcharge Details for TDS

Show Alternate Contact details - TDS

Showing All Deductor Types (TDS)

By default, only Company and Individual/HUF appears in the Collector/Deductor Type list.
You can use F12: Configure option to show all the deductor types for TDS.

To enable all deductor types for selection

1. Go to Gateway of Tally > F11: Features > Statutory and Taxation.

2. Enable the option Set/alter TDS details.

3. Click F12: Configure.

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4. Enable the option Show All Deductor type.

5. Press Ctrl + A to accept. All the organisation types will appear in

the Collector/Deductor Type list for the option Deductor Type.

Enabling Surcharge Details for TDS

You can enable surcharge details applicable for TDS by using the F12:
Configure option.

To enable surcharge details for TDS

1. Go to Gateway of Tally > F11: Features > Statutory and Taxation.

2. Enable the option Set/alter TDS details.

3. Click F12: Configure.

4. Set the option Enable Surcharge Details for TDS to Yes.

5. Press Ctrl + A to accept.

6. Enable the option Provide surcharge details.

7. Enter the surcharge details, as required.

The TDS Surcharge Details screen appears as shown below:

8. Press Enter.

9. Press Ctrl + A to accept.

Showing Alternate Contact Details (TDS)

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You can use F12: Configure option to enable display of the alternate contact details for TDS.

To enable alternate contact details

1. Go to Gateway of Tally > F11: Features > Statutory and Taxation

2. Enable the option Set/alter TDS details.

3. Click F12: Configure.

4. Enable the option Show Alternate Contact Details.

5. Press Ctrl + A to accept.

6. Enter the STD Code, Phone No. and E-Mail.

7. Press Ctrl + A to save the details.

Creating TDS Nature of Payment

For payments attracting TDS, the relevant nature of payment is defined by the department
with associated tax rate, section, payment code, and threshold limit. While creating a TDS
Nature of Payment, you can press Ctrl+C to select the required nature of payment.

To create TDS nature of payment

1. Go to Gateway of Tally > Accounts Info. > Statutory Info. > TDS Nature of
Pymts > Create.

2. Press Ctrl+C to view the list of Nature of Payment.

3. Select the required Nature of Payment.

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Note: The nature of payment Income in Respect of Investment in Securitization Trust has
been introduced in release 5.4.
The Section and Payment code are displayed automatically.

4. Enter the Rate of TDS.

5. Enter the Threshold/exemption limit as applicable.

6. Click F12: Configure to configure more options.

7. Press Ctrl+A to save the details.

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In the text file generated as per File Validation Utility (FVU) version 5.6, the letter B appears
as remarks for transactions recorded at lower or zero deduction for TDS nature for all
the Nature of Payments under section 194J.

Creating Expenses Ledger (TDS)

An expenses ledger is used for booking expenses. It can be created by selecting
the Nature of Payment during ledger creation.

To create an expense ledger

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create.

2. Enter the Name.

3. Select Indirect Expenses as the group name in the Under field.

4. Set Inventory values are affected to No.

5. Enable the option Is TDS Applicable?.

6. Select the Nature of Payment from the List of Nature of Payments.

The Ledger Creation screen appears as shown below:

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7. Press Ctrl+A to save the details.

Creating Party Ledger (TDS)

TDS will be deducted on the basis of the deductee type, which has to be defined in the party
ledger.

To create a party ledger

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create

2. Enter the Name.

3. Select Sundry Creditor as the group name in the Under field.

4. Enable the option Maintain bill-by-bill, if required.

5. Enable the option Is TDS Deductible?

6. Select a Deductee Type.

7. Enable Deduct TDS in Same Voucher, if required.

8. Enter the Name of the service provider under Mailing Details.

9. Enter the Address.

10. Select the Country from the List of Countries.

11. Select the State from the List of States.

12. Enter the PIN Code.

13. Enable Provide Bank Details, if required.

14. Enter the PAN under Tax Information.

15. Enable the option Provide PAN Details to enter PAN details of the party.

The Ledger Creation screen appears as shown below:

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16. Press Ctrl+A to save the details.

Creating TDS Ledger

A TDS ledger is used for recording duties in TDS related transactions.

To create a TDS tax ledger

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create.

2. Enter the Name.

3. Select Duties and Taxes as the group name in the Under field.

4. Select TDS as the Type of Duty/Tax.

5. Select a Nature of Payment from the List of Nature of Payments.

6. Press Enter.

The Ledger Creation screen appears as shown below:

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7. Press Ctrl+A to save the details.

Creating Stock Item (TDS)

Stock items with TDS details can be created only if it is configured on the
Company TDS Deductor Details page.

To create a Stock item for TDS

1. Go to Gateway of Tally > Inventory Info. > Stock Item > Create.

2. Enter the Name.

3. Select a stock group from the List of Stock Groups in the Under field.

4. Select a unit of measurement in the Units field.

5. Enable the option Set/alter TDS details.

6. Select the Nature of Payment from the List of Nature of Payment.

7. Press Enter.

The Stock Item Creation screen appears as shown below:

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8. Press Ctrl+A to save the details.

Creating Fixed Asset Ledger (TDS)

A Fixed Asset ledger is used for recording fixed assets and capital goods.

To create a fixed asset ledger

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create.

2. Enter the Name.

3. Select Fixed Assets as the group name in the Under field.

4. Set Inventory values are affected to No.

5. Set Is TDS Deductible to Yes.

6. Set Treat as TDS Expenses to Yes.

7. Select the required Nature of Payment.

8. Enter the Mailing Details and Tax Registration Details, as required.

The Ledger Creation screen appears as shown below:

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9. Press Ctrl + A to save the details.

Configurations in Masters for TDS

You can enable advance configurations for TDS in party masters. This will allow you
to configure surcharge exemption limits, and income exemption limits. You can also
set a zero or lower rate of TDS for party masters.

Ignore surcharge exemption limit

Ignore income tax exemption limit

Set zero/lower rate for TDS

Ignoring Surcharge Exemption Limit

You can choose to ignore surcharge exemption limit while creating ledgers by
using F12: Configure options for advanced TDS entries.

To ignore surcharge exemption limit

1. Click F12: Configure in the Ledger Creation screen.

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2. Enable the option Allow advanced entries in TDS masters.

3. Press Ctrl + A to save the details. A new option Use Advanced TDS Entries will
be available.

4. Enable the option Use Advanced TDS Entries.

5. Enable the option Ignore Surcharge Exemption Limit.

6. Press Ctrl + A to save the details.

7. Press Ctrl + A to save the party master.

Ignoring Income Tax Exemption Limit

You can choose to ignore income tax exemption limit while creating ledgers by
using F12: Configure options for advanced TDS entries.

To ignore income tax exemption limit

1. Click F12: Configure in the Ledger Creation screen.

2. Enable the option Allow advanced entries in TDS masters.

3. Press Ctrl + A to save the details. A new option Use Advanced TDS Entries will
be available.

4. Enable the option Use Advanced TDS Entries.

5. Select Applicable in the Set/Alter Ignore Income Tax Exemption Limit.

6. Select the required TDS nature of goods from the List of TDS Nature of Pymts.

7. Select End of List to exit the screen.

8. Press Ctrl + A to save the details.

9. Press Ctrl + A to save the party master.

Setting Zero or Lower Rate for TDS

You can set up zero or lower rate related to TDS by enabling the necessary
configurations under F12: Configure during ledger creation.

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To set zero or lower rate for TDS

1. Click F12: Configure in the Ledger Creation screen.

2. Enable the option Allow advanced entries in TDS masters.

3. Press Ctrl + A to save the details. A new option Use Advanced TDS Entries will
be available.

4. Enable the option Use Advanced TDS Entries.

5. Select Applicable in the Set/Alter Zero/Lower Collection.

6. Select the required TDS nature of payment from the List of TDS Nature of
Pymts.

7. Select the Section Number.

8. Enter the Certificate No./ Date.

9. Enter the Applicable From date.

10. Enter the Applicable To date.

11. Enter the rate of TDS in the TDS field.

12. Repeat steps 6 to 10 for the required TCS nature of goods.

13. Select End of List to exit the screen.

14. Press Ctrl + A to save the details.

15. Press Ctrl + A to save the party master.

Accounting for TDS on Expenses

You can create an accounting voucher for your business expenses, along with the
applicable TDS.

Scenario: On 30-4-2015, ABC Company paid MAR Tech Park ₹ 5,00,000 as rent.

To create a journal voucher

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 30-4-2015.

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3. Debit the Rent expense ledger.

4. Enter 500000 in the amount field.

5. Credit MAR Tech Park. The amount after TDS deduction will appear in
the Amount field automatically.

6. Press Enter.

7. Enter the Bill-wise Details, as required.

8. Press Enter.

9. Credit the TDS tax ledger. The TDS amount will automatically filled in
the Amount field.

10. Press Enter.

11. Enter Narration, if required.

The Journal voucher appears as shown below:

12. Press Ctrl+A to save the voucher.

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Accounting for TDS on Advance
Payment
You can create an accounting voucher for advance payments made directly or by a
third-party, along with the applicable TDS.

Scenario 1: On 1-5-2015, ABC Company paid an advance of ₹ 1,00,000 on rent to

MAR Tech Park as rent directly.

To create an advance payment

1. Go to Gateway of Tally > Accounting Voucher > F5: Payment

2. Click F2: Date to change the date to 01-05-2015.

3. Select bank ledger in the Account field.

4. Select MAR Tech Park in the Particulars field.

5. Enter 100000 in the amount field.

6. Select the TDS tax ledger. The TDS amount will automatically filled in
the Amount field.

7. Press Enter.

8. Enter the Bank Allocation Details, as required.

9. Press Enter.

10. Enter Narration, if required.

The Payment invoice appears as shown below:

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11. Press Ctrl + A to save the invoice.

Scenario 2: On 2-4-2015, XYZ Company paid an advance of ₹ 1,00,000 on rent to MAR

Tech Park as rent on behalf of ABC Company.

To create an advance payment via third party

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 01-05-2015.

3. Select MAR Tech Park, debit 100000.

4. Select XYZ Company, credit 90000.

5. Select the TDS tax ledger. The TDS amount is automatically filled.

6. Press Enter.

7. Enter the TDS Details, as required.

8. Press Enter.

9. Enter Narration, if required.

The Journal invoice appears as shown below:

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10. Press Ctrl+A to save the invoice.

Deducting Tax at Lower Rate (TDS)

To record a transaction attracting a lower rate with applicable TDS can be recorded
by using the commission expense ledger.

The Assessing Officer shall issue a certificate for deduction of Tax at Lower rate than
the relevant rate specified under the section, Where the assessing officer is satisfied
that the total income of the recipient (Assessee) justifies the deduction of income tax
at any lower rates than the rate specified under the sections specified under the act
and has received an application in Form 13 from the assessee under sub-section (1)
of section 197.

The certificate granted shall be valid for the assessment year specified and is valid
only for the person named therein.

Scenario: On 16-05-2015, ABC Company received a bill from ACE Computers for
₹80,000 towards commission charges. ACE Computers has a certificate for deduction
of Income tax at Lower rate @ 5%, on Commission.

To record expenses in the journal voucher

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1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 16-5-2015.

3. Debit the Commission expense ledger.

4. Enter 80000 in the amount field.

5. Credit ACE Computers. The amount after TDS deduction will appear in
the Amount field automatically.

6. Press Enter.

7. Enter the Bill-wise Details, as required.

8. Press Enter.

9. Credit the TDS tax ledger. The TDS amount will automatically filled in
the Amount field.

10. Press Enter.

11. Enter Narration, if required.

The Journal voucher appears as shown below:

12. Press Ctrl+A to save the voucher.

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In the text file generated as per File Validation Utility (FVU) version 5.6, the
letter B appears as remarks for transactions recorded at lower or zero deduction for
TDS nature for all the Nature of Payments under section 194J.

Deducting Tax at Zero Rate (TDS)

A Deductee (other than Company or Firm) can submit a declaration in Form 15G under sub
section (1) of section 197A, for TDS deduction at Zero Rate. Declarations can be given only by
those deductees whose income is below the taxable limit and the income falls under section
193, 194, 194A, 194EE and 194K.

The certificate granted shall be valid for the assessment year specified and is valid only for
the person named therein.

Scenario: On 25-5-21-015, ABC Company received a bill from Gokul Co-operative Building
Society for Rs. 10,00,000 towards Rent on Building and Furniture. Gokul Co-operative
Building Society has a certificate for non-deduction (zero rate) of Income tax on Rent.

To record expenses in the journal voucher

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 25-5-2015.

3. Debit the Rent expense ledger.

4. Enter 1000000 in the amount field.

5. Credit Gokul Co-operative Building Society.

6. Press Enter.

7. Enter the Bill-wise Details, as required.

8. Press Enter.

9. Enter Narration, if required.

The Journal voucher appears as shown below:

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10. Press Ctrl+A to save the voucher.

Recording Payment Transaction (TDS)

You can record a payment transaction with inclusion of the necessary TDS to be paid
to the government.

Scenario 1: On 05-05-2015, ABC Company paid TDS deducted in the month of April
2015 to the government directly.

To record a payment transaction

1. Go to Gateway of Tally > Accounting Vouchers > F5: Payment.

2. Click S: Stat Payment.

3. Select TDS as the Tax Type.

4. Enter the Period From and To dates.

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5. Enter the Deducted Till Date.

6. Select the Section from the List of Section.

7. Select the required Nature of Payment.

8. Select the Deductee Status.

9. Select the Residential Status.

10. Select either bank or cash ledger in the Cash/Bank field. The payment voucher
will be automatically filled with the relevant values.

The Statutory Payment Details screen appears as shown below:

11. Press Enter.

12. Enter the Bank Allocation details as required.

13. Enter Narration, if required.

The Payment invoice appears as shown below:

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14. Press Ctrl + A to save the invoice.

Scenario 2: On 05-05-2015, XYZ Company paid the TDS deducted to the government
on behalf of ABC Company.

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 05-05-2015.

3. Debit TDS tax ledger.

4. Credit XYZ Company.

The Journal invoice appears as shown below:

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5. Press Ctrl+A to save.

Accounting for Expenses, Deducting TDS

Later
It is always expected that the deductor should deduct the tax in the same invoice in
which the expenses are accounted. But in some cases, deductor may follow the
procedure of accounting only expenses on the receipt of bills and later, deduct
applicable tax on all such accounted expenses in one invoice.

Scenario: On 1-4-2015, ABC Company paid MAR Tech Park ₹ 5,00,000 as rent
(accounting only expenses). On 14-4-2015, deducting applicable tax.

Accounting for Expenses

To create a journal voucher

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 1-4-2015.

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3. Debit the Rent expense ledger.

4. Enter 500000 in the amount field.

5. Credit MAR Tech Park.

6. Enter 500000 in the amount field.

7. Press Enter.

8. Enter Narration, if required. The Journal voucher appears as shown below:

9. Press Ctrl+A to save the voucher.

Deducting Applicable TDS

To create a journal voucher

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 14-4-2015.

3. Debit MAR Tech Park.

4. Enter 100000 in the amount field.

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5. Enter the required details in the Bill-wise Details screen.

6. Press Enter.

7. Credit TDS on Rent ledger.

8. Enter 100000 in the amount field.

9. Enter the required details in the TDS Details screen.

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10. Press Enter.

11. Enter Narration, if required. The Journal voucher appears as shown below:

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12. Press Ctrl+A to save the voucher.

Accounting for TDS on Transport

You can create an accounting voucher for transport-related expenses, along with the
applicable TDS.

Section 194C of Income Tax Act is amended to include TDS deduction of 1 % for
individuals and Hindu Undivided Families owning more than 10 goods carriage, and
at the rate of 2% in case of other payees. For others not owning more than 10 goods
carriage at any time during the previous financial year, and who has furnished a
declaration to this effect along with his PAN, no TDS is applicable.

Note: A TDS of 20% is applicable for parties without a valid PAN.

Scenario: Rekha Traders availed transportation services from ABC Transporters
(owns more than 10 goods carriers) on 24-4-15 on which a TDS of 2% is applicable.

To create a journal voucher

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 24-4-2015.

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3. Debit Transport Expense ledger, by 50000.

4. Credit ABC Transporter, amount is automatically filled.

5. Enter the required details in the Bill-wise Details screen.

6. Press Ctrl+A to save.

7. Credit TDS ledger, amount is automatically filled.

8. Enter Narration, if required.

The journal voucher appears as shown below:

9. Press Ctrl + A to save the voucher.

Scenario: Rekha Traders availed transportation services from XYZ Transporters

(owns less than 10 goods carriers) on 28-4-15.

To create a journal voucher

1. Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2. Click F2: Date to change the date to 28-4-2015.

3. Debit Transport Expense ledger, by 30000.

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4. Credit XYZ Transporters, amount is automatically filled.

5. Enter the required details in the Bill-wise Details screen.

6. Press Ctrl+A to save.

7. Enter Narration, if required.

The journal voucher appears as shown below:

8. Press Ctrl + A to save the voucher.

Deducting TDS when expenses are paid

through Cash in Release 5.x
Using purchase vouchers, you can account for TDS when expenses are paid through
cash.

1. Go to Gateway of Tally > Accounts Vouchers > F9: Purchase:

● Select Cash in Party’s A/C name.

● In Supplementary Details screen,

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o Under Supplier details, press Alt + M: Party List

o Select the party from the list instead of cash.

2. Select Expenses and TDS duty ledgers. Once you select Duty ledger, party
details will appear with Party name, PAN number and deductee type.

Note: A party which is selected in Supplementary Details screen details will appear
after selecting TDS duty ledger. In Supplementary Details screen instead of
selecting the party from the list, party name can be entered manually if
required. In such case after selecting duty ledger, mention PAN number of party
and deductee type.

3. Press Enter to accept.

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Form 26Q (TDS)
Form 26Q is the Quarterly return of TDS in respect of all payments other than
salaries. As per the Income Tax Act, 1961, every corporate and government entity
responsible for deduction of tax at source should furnish TDS returns containing
details of deductee(s) and challan details relating to deposit of tax with the Income
Tax Department.

This is applicable for Resident and the due date for Government entities is July 31st,
October 31st, January 31st, and May 15th; for non-government entities the due
dates for filing returns are July 15th, October 15th, January 15th, and May 15th.

The Form 26Q report in Tally.ERP 9 assists you in generating accurate the returns to
be filed.

To generate Form 26Q

● Go to Gateway of Tally > Display > Reports > Statutory

Reports > TDS Reports > Form 26Q.

The Form 26Q report can be filed with accurate information available in this report.
It has three main sections:

● Statistics of Vouchers

● Deduction Details

● Payment Details

Statistics of Vouchers - Form 26Q (TDS)

The Statistics of Vouchers section of Form 26Q displays the total number of transactions
pertaining to a period which are categorised as Included, Excluded and Uncertain
Transactions.

Total Number of Transactions: Drill-down on this item to view the Statistics report
comprising of voucher types with the corresponding voucher count. The total count of
vouchers displayed for the Total Number of Transactions row is categorized

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as Included, Excludedand Uncertain Transactions with the voucher count against each of
the categories.

Included Transactions: Displays all vouchers that have the requisite information in their
corresponding masters and transactions to comply with the requirements for filing the
returns. These vouchers will be a part of TDS forms as applicable.

Excluded Transactions: Displays the count of all vouchers which are not a part of returns. As TDS
details are not provided in these transactions, there will be no implications on forms and annexures.

Uncertain Transactions: Displays the count of all vouchers with insufficient information.
These vouchers contain TDS related information and are not included in the count
of Included Transactions and Excluded Transactions.

A few examples of insufficient information include:

● Country, state and dealer type are not defined for party ledger.

● Tax details are not defined for stock item.

● Duty type is not defined for TDS ledger.

● Mismatch in country or state selected in party master and transactions.

● Mismatch in tax amount.

Total Number of Transactions

The statistics report displays the count of each voucher type used for recording transactions
under Total Number of Transactions, Included Transactions, Excluded
Transactions, and Uncertain Transactions.

To display the statistics report

1. Go to Gateway of Tally > Display > Statutory Reports > TDS Reports > Form 26Q or
Form 27Q.

2. Select Total Number of Transactions.

3. Press Enter to view all transactions for the period.

4. Select any voucher type and press Enter to view the Voucher Monthly Register.

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5. Select any month and press Enter to view Voucher Register. The Voucher Register screen
appears.

6. Select the required voucher.

7. Press Enter to edit the voucher.

Deduction Details (TDS)

The Deduction Details section under the TDS Reports for Form 26Q or 27Q denotes the
type of deduction under which each of the Included transaction is grouped.

The deduction details are classified into:

● Deduction at Normal Rate

● Deduction at Higher Rate

● Lower Rated Taxable Expense

● Zero Rated Taxable Expense

● Under Exemption Limit

● Exempt in lieu of PAN Available

The assessable value, tax deductible, and the tax deducted for transactions grouped in the
above categories are displayed here.

To view the Deduction Details

1. Go to Gateway of Tally > Display > Statutory Reports > TDS Reports > Form
26Q or Form 27Q.

2. Select the required deduction under Deduction Details, and press Enter.

The Deduction Details screen appears as shown below:

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To view the PAN number of each deductee

1. Click F12:Configure.

2. Set the option Show PAN Number to Yes.

The Deduction Details screen with PAN numbers appears as shown below:

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26Q TDS Payment Details
This section contains details of all TDS payment vouchers of the current period and
displays all payment entries recorded for interest, penalty, late fee, and so on. These
other payment entries for interest, penalty, and late fee, and so on will be displayed
under Other Payments.

Payments made to party, petty expenses, or any statutory payments other than that
of TDS are not displayed here.

To view the deductee-wise break-up of the paid TDS amount

1. Select the nature of payments under Particulars and press Enter.

2. Select the required deductee in Payment Voucher screen.

The Payment Voucher report is displayed company-wise, by default, as shown

below:.

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3. Select the required voucher and press Enter to view all the deduction vouchers
recorded for the selected party.

To view other payments

1. Select Other payments (Interest, penalty, late fee,

etc.) under Particulars in Payment Details, as shown below:

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2. Press Enter.

The Payment Voucher report for other payments appears as shown below:

To export the payment voucher

1. Press Alt+E to view the Exporting screen.

2. Select the required Format.8

3. Enter the required Output File Name.

4. Press Enter to export the vouchers.

A brief explanation of each field in the exported voucher report is given below:

Field Name Description

Deduction Displays the challan number used for

Details for

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challan No.
making payments to the government.
:

Date of Displays the date when TDS booking or

Payment / advance payment was made (whichever is
Credit earlier).

Displays the name of the deductee to

Party
whom TDS booking or advance payment
Name
entry was made.

Deductee Displays the type of deductee specified at

Type the TDS Nature of Payment screen.

Displays the PAN number of the deductee

PAN specified in the TDS Nature of
Payment screen.

Displays the rate of TDS specified in

Rate
the TDS Nature of Paymentscreen.

Payment Displays the Section Code specified in

Code the TDS Nature of Paymentscreen.

Challan Displays the challan date specified in

Date the Challan Reconciliationscreen.

Displays the assessable value of the TDS

Assessable
item for which booking or advanced
Value
payment entry was made.

Displays the income tax amount which was

Income Tax calculated at the TDS booking or advanced
payment entry journal.

Displays the amount of surcharge

calculated for the TDS booking or advanced
Surcharge payment entry, as per the rate specified
in TDS Surcharge Details screen in F3:
Statutory & Taxation features screen.

Education Displays the amount of education cess for

Cess the TDS booking or advanced payment
entry, as per the rate specified at TDS

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Surcharge Details screen, in F3: Statutory
& Taxation features screen.

Displays the amount of secondary

education cess for the TDS booking or
Secondary
advanced payment entry, as per the rate
Education
specified at TDS Surcharge
Cess
Details screen in F3: Statutory &
Taxation features screen.

Displays the total amount paid for TDS

booking or advance payment made. This is
Paid the consolidated amount of income tax,
Amount surcharge, education cess, and secondary
education cess in the TDS booking or
advanced payment entry voucher.

TDS Reconciliation Report

The TDS Reconciliation report displays the all the reconciled TDS payments.

To view the Challan Reconciliation report and reconcile TDS payment

challans

1. Go to Gateway of Tally > Display > Statutory Reports > TDS

Reports > Challan Reconciliation.

2. Click F5: Reconcile Challan.

3. Enter the Challan No.

4. Press Alt+S to set Challan Date.

5. Press Alt+L to show all or pending challan.

Note: As per NSDL department file validation tool, challan number and challan date
are not mandatory. In case of online TDS duty payment, user can provide the
challan number and challan date or leave the fields blank, and validate E-TDS file
successfully.
Column
Description
Names

Date Displays the payment

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voucher date.

Particular Displays the duty ledger

s selected in the voucher.

Displays
the From and To dates
entered at the Statutory
E-TDS
Payment Details screen. If
Quarter
TDS duty payment is
Period
recorded manually, the
quarterly period has to be
entered manually here.

Displays the section

number of the TDS Nature
Section of Payments entered at
No. the Statutory Payment
Details screen of the TDS
duty payment entry.

Displays the Deductee

Status Typeentered at
Deductee
the Statutory Payment
Type
Detailsscreen of the TDS
duty payment entry.

Displays the Residential

Status entered at
Resident
the Statutory Payment
Type
Details screen of the TDS
duty payment entry.

Displays the cheque or DD

Cheque/D number which were
D No. entered manually at the
time or reconciliation.

Cheque/DD Displays the cheque or DD

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date which were entered
Date. manually at the time or
reconciliation.

Displays the BSR Code of

the bank which was entered
BSR Code
manually at the time or
reconciliation.

Displays the challan

number provided by the
Challan No. bank which was entered
manually at the time of
reconciliation.

Displays the challan date

provided by the bank
Challan
which was entered
Date
manually at the time of
reconciliation.

Displays the payment

Vch No.
voucher number.

Displays the amount paid

Amount recorded in the TDS
payment voucher.

TDS Outstanding Report

The TDS Outstanding report displays all the pending TDS payments. You can view
the pending details party-wise, or based on resident or non-resident status.

To view TDS Nature of Payment Outstandings report

● Go to Gateway of Tally > Display > Statutory Reports > TDS Reports > TDS
Outstandings.

The TDS Nature of Payment Outstandings report appears as shown below:

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A brief explanation about the fields in the report is given below:

Field Name Description

Displays the name of the TDS Nature of Payment as

Nature of specified in the duty ledger which was used in
Payment recording the TDS booking with deduction or TDS
deduction entry.

Displays the total amount of outstanding for all

parties of Company-resident deductee type used in
Company
recording the TDS booking with deduction or TDS
deduction entry.

Displays the total amount of outstanding for all

Non parties of Individual/HUF-resident deductee type
Company used while recording the TDS booking with
deduction or TDS deduction entry.

Total Displays the total outstanding amount of all TDS

Pending payment from all parties.

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To view section code, payment code and pending payment payable details
of non-resident, resident, or both

● Click F12:Configure

● Set the options in the Configuration screen.

● Press Ctrl+A.

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By default the report appears category-wise, you the change it to party-wise using
the option F6: Party-wise.

To view the party-wise information

● Click F6:Party-wise

The party-wise report appears as shown below:

To view the transaction details of the each nature of payment

1. Select the required Nature of Payment and pres Enter.

The TDS Nature of Payment Outstandings report for the selected nature of
payment appears as shown below:

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2. Click F7: Deductee Type to view the report of the selected nature of payment
to only company or non-company deductees.

3. Click F12: Configure to change the display of report in terms of the following
options:

o Range of Bills to show

o Appearance of Names
o Sorting Method
A brief explanation about the report fields is given below:

Field Name Description

Displays the date of recording payment, journal

Date
or purchase voucher.

Displays the reference number entered in the

Ref. No.
payment, journal or purchase voucher.

Displays the party name from where TDS is

Party's
deducted and the payment for the same are yet
Name
to be made.

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Opening
Displays the opening amount of TDS.
Amount

Pending Displays the pending amount of payment to be

Amount made to the government.

Due On Displays the last date of payment.

Overdue Displays the number of days passed after the

By Days due date.

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Point of Sale (POS) in Tally.ERP 9
POS is an acronym for Point of Sale. Point of Sale could mean a retail shop, a check-out counter in a
shop or any other location, where a sales transaction takes place. The various POS equipment used in
retail outlets are Cash registers, card readers and barcode scanners.

It is a computerized Cash Register which adds the sales total, computes the State sales tax or VAT,
calculates the change from the money tendered and automatically adjusts the store’s inventory to debit
the amount of inventory sold.

Creating a POS Voucher Type with Voucher Class

Creating a POS Voucher Type without Voucher Class

Creating a POS Invoice with Single Payment

Creating a POS Invoice with Multi-Mode Payment

Creating a POS Invoice using Voucher Class

POS Invoicing with Advanced Configurations

Creating a POS Invoice with Batch wise Details

Creating a POS Invoice with different Actual & Billed Qty

Features of POS Invoicing

The POS (Point-of-Sale) feature allows you to create POS Invoices and allows receipt of payments
from the customers and print them in the required formats.

Features of POS Invoicing in Tally.ERP 9

The POS Invoicing functionality in Tally.ERP 9 is:

 Simple and user friendly

 Quick and easy to setup and use

 Facilitates faster data entry and calculations

 Helps you to calculate sales and sale proceeds

 Manages inventory and facilitates bar code scanner operations

 Offers a flexible and simple way of querying your inventory and sales information

 Helps you to track the movement of items and how much you are spending on them

 Tracks and records the date and time of every sale made at the store

 Helps faster printing of Invoices

Creating POS Voucher Type with Voucher Class

To create a POS Invoice Voucher Type with Voucher Class, you may create a new POS Invoice
Voucher Type or alter an existing Sales Voucher Type with Use for POS Invoicing option set to Yes.

To create POS Voucher Type with Voucher Class,

Go to Gateway of Tally > Accounts Info > Voucher Type > Create

Tab down to Name of Class field and specify the name of the Voucher Class
The payments against POS Invoices are generally made by way of Cash, Gift Vouchers, Cheques/Drafts
or through Credit/Debit Cards. To account for receipt of payments from customers by different modes,
set the required option to Yes and select the required ledger in the respective fields.

1. Set Yes in Gift Vouchers field to enable the option during POS Invoice Entry and select the Gift
Vouchers under Ledger Name field (if does not exist, create using Alt+C. The Gift Vouchers
ledger should be created under Sundry Debtors group).
2. Set Yes in Credit/Debit Card Payment field to enable the option during POS Invoice Entry and
select the required Bank Ledger under Ledger Name field

3. Set Yes in Cheque/DD field to enable the option during POS Invoice Entry and select the
required Bank Ledger under Ledger Name field

4. Set Yes in Cash field to enable the option during POS Invoice Entry and select the required Cash
Account under Ledger Name field

Note:

• For Gift Vouchers, the ledgers should be created under Sundry Debtors Group

• For Credit/Debit Cards, the respective Bank Ledger should be created under Bank account or Bank
OD/OCC

• For Payment through Cheque/DD, the respective Bank Ledger should be created under the group
Bank Accounts or Bank OD/OCC

• For Cash, the Ledger should be under group Cash-in-Hand

For more details on Voucher Class, please refer Sales Voucher class.

The other entries for each item in Invoice are similar to default Sales Voucher class creation.

Creating a POS Voucher Type without Voucher

Class
To enable POS Invoicing in Tally.ERP 9. create a POS Invoice Voucher Type. You may also alter an
existing Sales voucher type for this feature to be enabled.

Go to Gateway of Tally > Accounts Info > Voucher Type > Create
Name: Enter the name of the Voucher type (for e.g.: POS Invoice).

Type of Voucher: Select the type of Voucher as Sales from the predefined Voucher Types.

Abbreviation: By default, Sales text will appear in the abbreviation field. However, you can enter the
abbreviation as per your requirements

Used for POS Invoicing?: On selecting the Sales voucher type from the list, Used for POS Invoicing?
Option appears, set this option to Yes

Print Message 1 and Print Message 2: These two additional fields for messages appear on enabling the
above POS feature, which can used for custom messages viz., *Thank You* or *Visit Again* and so on
as per your requirements. The same will be printed at the bottom of the POS invoice.

Default Print Title: You can specify the printing title of the POS Invoice and the same will be printed
in the Invoice.

Note:

1. Once Use POS for Invoicing option is set to Yes in voucher type, you will not be entitled to set this
field to No, if you have passed any POS Invoice.

2. To know about advanced configurations refer detailed information on Use Advance Configuration
usage.
Creating a POS Invoice
To enter a simple transaction using a POS Invoice with single payment mode:

Go to Gateway of Tally > Accounting Vouchers > Select F8: Sales

1. Select the POS Invoice as the Voucher type from the list of Voucher types.

2. Select the Godown, Sales Ledger and VAT/Tax Class as applicable.

3. Select the Item using the Bar code reader to scan the bar code or select the Item from the list.

4. The Rates of the Item is picked up from Set Standard Rates screen (Stock Item Creation screen)
or from the Price List screen.

5. Select VAT/Tax Ledger from the list of Ledger Accounts.

6. By default for the first time, the POS Invoice screen will appear in Single Mode Payment.

The screen will appear as below with the Cash and Cash tendered fields:

7. Accept to save.

Configurations in POS Invoice:

1. Allow Party Details in POS Invoice: By setting this option to Yes, you are able to select the
Customer’s Ledger. If you do not want to create a separate Ledger for the Buyer and still would
like to print the customer’s name in the Invoice print, select Not Applicable from the List of
Ledger Accounts and specify the Buyer’s name and address details in the Buyer’s details.

2. Skip Qty field during POS Invoicing (faster entry): By default, the same will be set to Yes so
that while passing the Invoice, the cursor will skip the Quantity field. The user may set this
option to No, to specify the required number of quantity.

3. Allow modification of Rate field during POS Invoicing: The rates are automatically picked as
per the Standard rates defined in the Stock Item master or from the Price List. However, you
can change the rate during entry, by setting this option to Yes.

For more details on printing POS Invoice, please refer Printing POS Invoice.

Printing a POS Invoice

Creating a POS Invoice with Multi-Mode
Payment
To create a POS Invoice with Multi Mode Payment, click on the Multi Mode Pymt button in the
Button bar, to account for receipt of payments through other modes like Gift vouchers, Credit card/Debit
Card or by cheque/DD etc.

To enter POS Invoice with Multi Mode Payment:

Go to Gateway of Tally > Accounting Vouchers > Select F8: Sales

1. Select the POS Invoice as the Voucher type from the list of Voucher types.

2. Select Multi Mode Pymt option from the Button Bar or press Ctrl+P.

3. Select the Godown, Sales Ledger and VAT/Tax Class if applicable.

4. Select the Item using the Bar code reader to scan the bar code or select the Item from the list.

5. The Rates of the Item is picked up from Set Standard Rates screen (Stock Item master) or from
the Price List screen.

6. Select VAT/Tax Ledger from the list of Ledger Accounts.

7. Allocate the Bill amount to the relevant modes of payment.

8. Select Gift voucher from the list and enter the amount OR Select Credit/Debit Card Payment
and enter the amount and the card number OR Select the Cheque and enter the amount, Bank
Name and Cheque Number OR Select Cash ledger from the list and enter the amount to be paid.

9. Accept the POS Sales Invoice screen.

For more details on printing POS Invoice, please refer Printing POS Invoice.

Note:

• Though Maintain Multiple Godown feature is set to Yes in F11: Inventory Features, you can select
only one Godown, while passing a POS Invoice.

• Single Mode/ Multi Mode Pymt: You can toggle between single and multi mode payments by
clicking on the Single Mode Pymt button. In Multi Mode the customer can choose to make his
payment by Credit/Debit cards, Gift Vouchers, Cheque or Cash and have all details available on his
invoice. In Single Mode only Cash field will be available in the Invoice.

• If Use Multiple Price level for Invoicing is enabled for the Item then the rates of the Item is picked up
from the price levels. Else, you can set the price of the Item in the Stock Item creation screen using the
Set Standard Rates to Yes. Enter the standard selling price of the Item (Press F12: Configure button
in the Stock Item creation screen and set Allow Std. Rates for Stock Items to Yes).

• If you have set the rate for an Item both in Price Levels and in Set Standard Rates (in Stock Item
Creation screen), the rate is picked up from the Price List and not from the Set Standard Rates in
Stock Item creation screen.
POS Invoicing with Advance Configurations
 Set Maintain Batch-wise Details and Set Expiry Dates for Batches to Yes in the F11:
Inventory Features screen.

 Set Use different Actual & Billed Qty. to Yes in F11: Inventory Features screen to specify the
free items.

 Set Separate Discount column on Invoices to Yes to specify the discount on any items while
making a POS sales invoice.

 Create Stock Items. Place the cursor in the alias field and use the Bar Code Reader to scan and
read the bar code of the Item. This code will automatically get displayed in the alias field. Select
the Unit of measure and Set Maintain in Batches to Yes. On setting this option you will get
Track Date of Mfg and Use expiry dates set these two fields to Yes.

 Set Standard Rates to Yes and enter the standard selling price of the Item (Press F12: Configure
button in the Stock Item creation screen and Set Allow Std. Rates for Stock Items to Yes). If you
have specified the rates in the price level then you can skip this field.

 Set Use Security Control to Yes in Company Creation/Alteration screen and create the user login
name using the security feature in Tally.ERP 9. The user who logs in to Tally.ERP 9 with the
name of the user and password can print the POS Invoice with the user name.

Creating a POS Invoice with Batchwise Details

Creating a POS Invoice with different Actual & Billed Qty

Creating a POS Invoice using Voucher Class

To create a POS Invoice using Voucher Class:

Go to Gateway of Tally > Accounting Vouchers > Select F8: Sales

1. Select the POS Invoice as the Voucher type from the list of Voucher types.

2. Select POS Class from the Voucher Class List.

3. Select Multi Mode Pymt option from the Button Bar or press Ctrl+P

4. Select the Godown and Party’s A/c Name.

5. Select the Item select the Item from the list or using the Bar code scanner or

6. The Rates of the Item is picked up from Standard Rates (Stock Item Creation screen) or from
the Price List screen.

7. The Item will be allocated to the Sales Ledger as defined and Tax will also get calculated
automatically.

8. Allocate the Bill amount to the relevant modes of payment.

Cash Tendered Field: When the payment is made by way of cash and once the user specifies the Cash
tendered value, the balance will be calculated automatically.
In the above example: the Cash tendered by the buyer is Rs. 500 and payable amount was Rs. 360 and
hence the balance to be paid back is Rs. 140.

For more details on printing POS Invoice, please refer Printing POS Invoice.

Creating a POS Invoice with Batchwise Details

Go to Gateway of Tally > Accounting Vouchers > Select F8: Sales

1. Select the POS Voucher Type

2. Select Godown, Party A/c Name, Sales Ledger and VAT/Tax Class (if applicable) from the list.

3. Select the Item from the list or use the scanner to read the bar code of the item. On selecting the
Item from the list or by scanning, you will be prompted to enter the Batch Name in the New
Number screen. Enter the Batch Name of the Item.

4. Tally.ERP 9 prompts you to enter the Manufacturing Date and the Expiry Date as below:
5. The rate of the Item entered in the Set Standard Rates (in Stock Item creation master) or in
Price List screen will get prefilled in the Rate field.

Now, you can print POS Invoice with Batch details. All other configurations are similar to creating a
POS Invoice. For more information refer Creating a POS Invoice.

Example:

If you buy 2 shirts and get 1 shirt free with it, while entering POS Invoice, enter 3 shirts in the Actual
Column and 2 shirts in the Billed Column. While printing the Invoice, the difference in the actual and
billed quantity will be shown as Free in the Rate Column.

In the example below, for 100 nos. of purchase, 10 quantity is given free.

6. Select VAT/Tax from the list.

7. Select Gift voucher from the list OR Select Credit/Debit Card Payment and the card number
and enter the amount OR Select the Cheque and enter the amount, Bank Name and Cheque
Number.

8. Select the Cash account and enter the cash paid by the customer at the counter. The balance
amount, which has to be paid to the customer, will be calculated automatically.

9. Accept the POS Sales Invoice screen to save the transaction.

For more details on printing POS Invoice, please refer Printing POS Invoice.

Extra Features available from a POS Invoice screen are:

Single Mode/ Multi Mode Pymt: You can toggle between single and multi mode payments by clicking
on the Single Mode Pymt button. In Multi Mode the customer can choose to make his payment by
Credit/Debit cards, Gift Vouchers, Cheque or Cash and have all details available on his invoice. In
Single Mode only the Cash transaction fields will be printed on the invoice.

Note:

• If Use Multiple Price level for Invoicing is enabled for the Item then the rates of the Item is picked up
from the price levels. Else, you can set the price of the Item in the Stock Item creation screen using the
Set Standard Rates to Yes. Enter the standard selling price of the Item (Press F12: Configure button in
the Stock Item creation screen and set Allow Std. Rates for Stock Items to Yes).

10. Set Use Security Control to Yes in Company Creation/Alteration screen and create the user login
name using the security feature in Tally.ERP 9. The user who logs in to Tally.ERP 9 with the
name of the user and password can print the POS Invoice with the user name.
Creating a POS Invoice with different Actual &
Billed Qty
Go to Gateway of Tally > Accounting Vouchers > Select F8: Sales

1. Select the POS Voucher Type

2. Select Godown, Party A/c Name, Sales Ledger and VAT/Tax Class (if applicable) from the list.

3. Select the Item from the list or use the scanner to read the bar code of the item. On selecting the
Item from the list or by scanning, you will be prompted to enter the Actual Qty and Billed Qty.

4. Select Gift voucher from the list OR Select Credit/Debit Card Payment and the card number
and enter the amount OR Select the Cheque and enter the amount, Bank Name and Cheque
Number.

5. Select the Cash account and enter the cash paid by the customer at the counter. The balance
amount, which has to be paid to the customer, will be calculated automatically.

6. Accept the POS Sales Invoice screen to save the transaction.

Now, you can print POS Invoice with different Actual and Billed Quantities. All other configurations
are similar to creating a POS Invoice. For more information refer Creating a POS Invoice.

Printing a POS Invoice

On accepting the POS Sales Invoice screen, press ALT+P or click on Print button, Tally.ERP 9
prompts you to print. Press ALT+S or click on the Select Printer button and select the printer from the
list. Currently, Tally.ERP 9 support STAR TSP 600 Compatible, Epson TM T88iii Compatible and
Epson TM U220 Compatible printers.
Press ALT+F or click on the Print Format to select the print mode. You can either select the Neat
Mode or Quick /Draft. In Neat Mode format you will be able to preview the POS Invoice where as in
Quick/Draft mode you cannot preview the POS Invoice.

1. Printing a POS Invoice in Single Mode Payment

The POS Invoice in preview mode

2. Printing a POS Invoice in Multiple Mode Payment with batch-

wise details
The POS Invoice in preview mode
3. Print Configurations in POS Invoice:
Press F12 or click on F12: Configure button and set the required options:
1. Set Print Item Name in One Line to Yes to print the Item details in a single line. If print format
is set to Neat Mode then Tally.ERP 9 will compress the name of the Item and prints in one single
line. However, if the print format is set to Quick Draft Mode then Tally.ERP 9 truncates the text
and prints in multiple lines.

2. Set Print Serial No. to Yes to print the serial number.

3. Set Print Rate Column to Yes to print the rate column.

4. Print Additional Description(s) for Item Name is set to No by default, set this option to Yes, if
you wish to print additional description for each item in the POS bill.

5. Set Print Batch Details to Yes to print the Manufacturing Date and Expiry Date.

6. Set Print MRP/Marginal to Yes to print MRP on POS Invoice.

7. Set Print Card/Cheque No. to Yes to print the Card/Cheque number.

8. Print whole Card Number is set to No by default, which will print only last 4 digit of card
number. Set this option to Yes to print the 16 digit card number on the POS Invoice.

9. Set Print VAT Analysis of Item to Yes to print the VAT Analysis on POS Invoice.

10. Set Print Narration to Yes to print the Narration on POS Invoice.

11. Set Print Default Name & Address of Party to Yes to print the Narration on POS Invoice.

Accept the Print screen to view the POS Invoice in preview mode (Only for Neat Mode format).
The Invoice displays the company name and address, TIN, CST, Bill number, time, date, user name,
serial number, description, quantity, rate, amount, Batch number, Expiry date, Manufacturing date, Free
Item (if any), discount (if any) Vat analysis, payment mode details, balance to be paid to the customer
and the print message.

Displaying POS Register

POS Register lists all transactions made over a particular day and by default displays the last invoice
entry date of a POS invoice. Each POS Invoice is further drilled down to obtain the lowest level of
information.
It could also be set to list all the transactions made over a period. Press F2: Period on the button bar or
press the keys Alt+F2.

To view the list of POS Invoice Statement:

Go to Gateway of Tally > Display > Accounts Books > POS Register

Note: POS Register option will appear, only if the option Use for POS Invoicing is activated in
Voucher Type and at least one entry is made.

Press ALT+F1 or click on F1: Detailed button to view the POS Invoice in detailed format with all the
tax details.

Press F12 key or click on F12: Configure button.

Set Show Inventory Details also to Yes and view the List of All POS Vouchers with Inventory details.

F5: Columnar: This button allows you to select different columns for the report. For additional information refer to
Columnar Sales Register.

F6: Extract: Provides you with a break down of the POS Invoice vouchers and groups them to provide totals for each group
and ledger used in all POS Invoice for that particular date.

Click on the Print button or press ALT+P to view the POS Register in print preview mode. Press
ALT+Z to zoom the print preview screen.

© Tally Solutions Pvt. Ltd. All Rights Reserved - 2012 www.tallysolutions.com

Setting Credit Limit for Party Ledgers in Tally.ERP 9
Did you know that you can set credit limits for your business partners in Tally.ERP 9 to ensure that no invoice is
wrongfully generated beyond this line of credit?

It is a good practice for a business to monitor the credit limits of customers and suppliers. This helps
in managing the receivables and payables of a business in a better way. Credit limit is normally set based on
the credibility, volume of transactions, capacity of repayment etc. of the customer and supplier. To ensure
better credit management, Tally.ERP 9 provides the Credit Limit option to set the maximum amount of
credit that can be allowed to a customer or a supplier. Using this feature, business owners can ensure that no
invoice will be generated beyond the set credit limit unless the user has the right to modify the same.

Setting up Credit Limit for the party ledgers in Tally.ERP 9 is very simple and effortless. All it takes
is enabling the option and setting the limit on the party ledger creation or alteration screen.

To enable Credit Limit:

 Go to Gateway of Tally > F11: Accounting Features
 Under ‘Budgets and Scenario Management’, set ‘Yes’ to ‘Maintain Budgets and Controls’

To set Credit Limit for a Single Ledger:

 Go to Gateway of Tally > Accounts Info. > Ledgers > Select ‘Alter’ under ‘Single Ledger’
 Select the required party ledger from the ‘List of Ledgers’ Set

the ‘Default Credit Period’ and ‘Credit Limit’ amount as shown:

© Tally Solutions Pvt. Ltd. All Rights Reserved - 2012 www.tallysolutions.com

Note: You can also specify the Credit Limit and Credit Period at the time of ledger creation or alteration.

To set Credit Limit for multiple party ledgers:

 Go to Gateway of Tally > Accounts Info. > Ledgers > Credit Limits
 Select the required ‘Group’ in ‘List of Groups’ like Sundry Debtors, Sundry Creditors
 On ‘Multi Ledger Limit Alteration’ screen, set the ‘Credit Limit’ for the ledgers as required

 Accept the screen

To demonstrate how Credit Limit effects the transaction, let’s try to pass a Sales Invoice using a
ledger called ‘Modern Timbers’ (Sundry Debtors) for an amount of more than `1,00,000 which is the
specified credit limit for this ledger. Whenever the invoice is raised beyond this limit, Tally.ERP 9 will
display a prompt message saying ’Credit Limit of the selected party exceeded’ as shown:

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The current balance and the credit limit of the Ledger accounts are displayed in
the Order and Invoice entry vouchers (Sales and Purchase) and these show the available
limits. In case, you need to pass the transaction beyond the Credit Limit, you can alter
the credit limit if you have the right permission.

Hence, with Tally.ERP 9, you can easily set credit limits for your party ledgers
and take control of your business’s receivables and payables. This in turn reduces risks
and improves collection for your business.

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TCS Intro
Attitude Academy
TCS Intro

• The person collecting tax at source in accordance with provisions of

Section 206C is required to issue a certificate of collection of tax at
source in Form No. 27D to the Buyer (or lessee or licensee) from whom
the tax is collected. Such certificate shall be furnished within one
month from the end of the month during which the amount is debited
to the account of the buyer (or licensee or lessee) or payment is
received from the buyer (or licensee or lessee).
• If more than one certificate is required to be furnished to a buyer (or
licensee or lessee) for the period ending 30th September or 31st
March in a financial year, the person collecting the tax on request from
such buyer issue a consolidated certificate in Form 27D for tax
collected during whole of such period.
• If an issued TCS certificate is lost, the person collecting tax at source
may issue a duplicate certificate on plain paper, with necessary details
as contained in Form-27D.
Total Exemption: No TCS Collection
• TCS can be totally exempted or fixed at a lower rate
under some circumstances.
• Total Exemption: No TCS Collection
• A declaration by the buyer in Form Number 27C (in
duplicate) has to be made for total exemption. The
declaration is if the goods listed are to be used for the
purpose of manufacturing or processing and not trading.
A copy of the declaration has to be given to the person
collecting tax.
• The person collecting this declaration form has to submit
the copy to the authorities concerned on or before the
seventh day of the following month.
• Lower Rate of TCS
• The buyer (Collectee) can apply to the Assessing Officer
(AO) for a lower rate, using Form No.13, subject to the
condition that the AO is convinced that the total income
of the buyer (Collectee) justifies the lower rate. The AO
may issue a certificate, specifying the rate of collection.
TCS Returns
Enabling TCS
To get started, you have to enable the Tax Collected at Source (TCS) module in
Tally.ERP 9 and enter your company's registration details.

To Enable Service Tax

1. Go to Gateway of Tally > F11: Features > Statutory and Taxation.

2. In the Company Operations Alteration screen, set Enable Tax Collected at

Source (TCS) to Yes.

3. Enable the option Set/alter TCS details.

The Company Operations Alteration screen appears as shown below:

4. Enter the TAN registration number.

5. Enter the Tax Deduction Account Number (TAN).

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6. Select the Collector Type.

7. Enable the option Set/alter details of person responsible.

8. Press Enter.

9. Enable Ignore IT Exemption Limit, if required.

10. Press Enter.

The TCS Collector Details screen appears as shown below:

11. Press Ctrl + A to save the details.

For more TCS configurations, click here.

Creating Party Ledger (TCS)

You can create a ledger for your customers under sundry debtors and also set their
TCS details.

To create a party ledger (Buyer)

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create

2. Enter the Name.

3. Select Sundry Debtor as the group name in the Under field.

4. Enable the option Maintain bill-by-bill, if required.

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5. Enable the option Is TCS Applicable.

6. Select a Collectee Type in the Buyer/Lessee field.

7. Enter the Name of the service provider under Mailing Details.

8. Enter the Address.

9. Select the Country from the List of Countries.

10. Select the State from the List of States.

11. Enter the PIN Code.

12. Enable Provide Bank Details, if required.

13. Enter the PAN under Tax Information.

14. Enable the option Provide PAN Details to enter PAN details of the party.

The Ledger Creation screen appears as shown below:

15. Press Ctrl + A to save the details.

For more configurations, click here.

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In the text file generated as per File Validation Utility (FVU) version 5.6, the
letter C appears as remarks when transactions are recorded for all TCS natures
when the party PAN is entered as:

● PANAPPLIED

● PANINVALID

● PANNOTAVBL

Creating Sales Ledger (TCS)

You can create sales ledger with TCS nature of goods under Sales Accounts.

To create a sales ledger

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create

2. Enter the Name.

3. Select Sales Accounts as the group name in the Under field.

4. Set Inventory values are affected to Yes.

5. Set the option Is TCS Applicable to Applicable.

6. Select the Nature of Goods from the List of Nature of Goods.

The Ledger Creation screen appears as shown below:

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7. Press Enter to save the details.

Creating Nature of Goods (TCS)

You can define the TCS nature of goods your business deals.

To create TCS nature of goods

1. Go to Gateway of Tally > Accounts Info. > Statutory Info. > TCS Nature of
Goods > Create.

2. Press Ctrl+C and select the Name.

3. The Section number and Payment Code appears automatically.

4. Enter the Rate of TCS.

5. Enter the Threshold/exemption limit.

The TCS Nature of Goods screen appears as shown below:

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6. Press Enter to save the details.

In the text file generated as per File Validation Utility (FVU) version 5.6, the
letter C appears as remarks when transactions are recorded for all TCS natures
when the party PAN is entered as:

● PANAPPLIED

● PANINVALID

● PANNOTAVBL

Ignoring Surcharge Exemption Limit

To ignore surcharge exemption limit

1. Click F12: Configure in the Ledger Creation screen.

2. Enable the option Allow advanced entries in TCS masters.

3. Press Ctrl + A to save the details. A new option Use Advanced TCS Entries will
be available.

4. Enable the option Use Advanced TCS Entries.

5. Enable the option Ignore Surcharge Exemption Limit.

6. Press Ctrl + A to save the details.

7. Press Ctrl + A to save the party master.

Ignoring Income Tax Exemption Limit

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To ignore income tax exemption limit

1. Click F12: Configure in the Ledger Creation screen.

2. Enable the option Allow advanced entries in TCS masters.

3. Press Ctrl + A to save the details. A new option Use Advanced TCS Entries will
be available.

4. Enable the option Use Advanced TCS Entries.

5. Select Applicable in the Set/Alter Ignore Income Tax Exemption Limit.

6. Select the required TCS nature of goods from the List of TCS Nature of Goods.

7. Select End of List to exit the screen.

8. Press Ctrl + A to save the details.

9. Press Ctrl + A to save the party master.

Set Zero/Lower Rate for TCS

To set zero or lower rate for TCS

1. Click F12: Configure in the Ledger Creation screen.

2. Enable the option Allow advanced entries in TCS masters.

3. Press Ctrl + A to save the details. A new option Use Advanced TCS Entries will
be available.

4. Enable the option Use Advanced TCS Entries.

5. Select Applicable in the Set/Alter Zero/Lower Collection.

6. Select the required TCS nature of goods from the List of TCS Nature of Goods.

7. Select the Section Number.

8. Enter the Applicable From date.

9. Enter the Applicable To date.

10. Enter the rate of TCS in the TCS field.

11. Repeat steps 6 to 10 for the required TCS nature of goods.

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12. Select End of List to exit the screen.

13. Press Ctrl + A to save the details.

14. Press Ctrl + A to save the party master.

Creating TCS Duty Ledger

You can create a duty ledger for accounting for TCS and also specify the nature of
goods.

To create a TCS duty ledger

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create.

2. Enter the Name

3. Select Duties and Taxes as the group name in the Under field.

4. Select TCS as the Type of Duty/Tax.

5. Select a Nature of Goods/Contract/License/Lease from the List of Nature of

Goods.

6. Press Enter.

The Ledger Creation screen appears as shown below:

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7. Press Ctrl + A to save the details.

Creating Stock Item (TCS)

You can create stock item masters for goods that are classified under the TCS nature
of goods.

To create a Stock item for TCS

1. Go to Gateway of Tally > Inventory Info. > Stock Item > Create.

2. Enter the Name.

3. Select a stock group from the List of Stock Groups in the Under field.

4. Select a unit of measurement in the Units field.

5. Set the option Is TCS applicable to Applicable.

6. Select the Nature of Goods from the List of Nature of Goods.

The Stock Item Creation screen appears as shown below:

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7. Press Ctrl + A to save the details.

Creating Stock Item (TCS)

You can create stock item masters for goods that are classified under the TCS nature
of goods.

To create a Stock item for TCS

1. Go to Gateway of Tally > Inventory Info. > Stock Item > Create.

2. Enter the Name.

3. Select a stock group from the List of Stock Groups in the Under field.

4. Select a unit of measurement in the Units field.

5. Set the option Is TCS applicable to Applicable.

6. Select the Nature of Goods from the List of Nature of Goods.

The Stock Item Creation screen appears as shown below:

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7. Press Ctrl + A to save the details.

Recording Sales Transaction (TCS)

TCS sales can be of two types, sale of goods under TCS and transfer of right to use.
This topic tells you how to record both these transactions.

Sales of TCS Goods

For example, Sujatha Timer Company trade in timber that is obtained from forest
lease. This is subject to TCS at 2.5%. On 6-4-2015, Sujatha Timber Company sold 100
metric ton (MT) at ₹ 7,500/MT of timber to Chandra Furniture.

To record a sales transaction

1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales > Item Invoice

2. Enter the Ref., if required.

3. Select Chandra Furniture in the Party's A/c Name field.

4. Select the sales ledger from the List of Ledger Accounts.

5. Select Timber from the List of Stock Items.

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6. Enter 100 in the Quantity field.

7. Enter 7500 in the Rate field. The Amount will be automatically calculated.

8. Press Enter from the Amount field.

9. Press Enter.

10. Select the TCS ledger which is created under Duties and Taxes. The TCS
amount will get calculated automatically.

11. Press Enter.

12. Enter Narration, if required.

The Sales invoice appears as shown below:

13. Press Ctrl + A to save the invoice.

Transfer of Right to Use

Every person, who grants lease or a license or enters into a contract or otherwise
transfers any right or interest (in any parking lot or toll plaza or mine or quarry)
either in whole or in part to another person for the purpose of business, is liable to

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collect tax at source from the licensee or lessee of any such license, contract or lease
at the prescribed percentage.

For example, MAR Teck Park is renting out their parking lot to Prakash
Enterprises for ₹ 2,00,000 for the month of May.

To record the transaction

1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales > Accounting
Invoice

2. Enter the Ref., if required.

3. Select Prakash Enterprises in the Party's A/c Name field.

4. Select the Rent (Income) ledger under Particulars.

5. Enter 200000 in the Amount field.

6. Press Enter.

7. Select the TCS ledger which is created under Duties and Taxes. The TCS
amount will get calculated automatically.

8. Press Enter.

9. Enter Narration, if required.

The Sales invoice appears as shown below:

Recording Sale of TCS Goods at Lower

Rate
Where the Assessing Officer is satisfied that the total income of the buyer justifies the collection of

tax at any lower rate than the relevant rate specified in Section 206C (1), Buyer (or licensee or

lessee) will be allowed a lower rate of TCS on an application made by the buyer (or licensee or

lessee) under sub-section (9) of section 206C in Form No. 13.

The certificate granted shall be valid for the assessment year specified and is valid
only for the person named therein. In Tally.ERP 9, the user can record and compute
TCS on transactions, on which lower rate of collection is applicable.
For example, on 20-04-2015, Sujatha Timer Company sold 200MT of Timber at ₹ 7500/MT to
Tirumala Timber at a lower rate of 1.5% TCS.

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To record the transaction

1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales > Item Invoice

2. Enter the Ref., if required.

3. Select Tirumala Timber in the Party's A/c Name field. To set lower rate of TCS
for this party click here.

4. Select the sales ledger from the List of Ledger Accounts.

5. Select Timber from the List of Stock Items.

6. Enter 200in the Quantity field.

7. Enter 7500 in the Rate field. The Amount will be automatically calculated.

8. Press Enter from the Amount field.

9. Press Enter.

10. Select the TCS ledger which is created under Duties and Taxes. The TCS
amount will get calculated automatically.

11. Press Enter.

12. Enter Narration, if required.

The Sales invoice appears as shown below:

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13. Press Ctrl + A to save the invoice.

Recording Payment Transaction (TCS)

You can record the payment of TCS collected to department in a payment invoice
using the Stat Payment button.

For example, on 05-05-2015, Sujatha Timber Company paid TCS to the government

To record a payment transaction

1. Go to Gateway of Tally > Accounting Vouchers > F5: Payment

2. Click S: Stat Payment button.

3. Select TCS as the Tax Type.

4. Enter the Period From and To dates.

5. Enter the Collected Till Date.

6. Select the Section from the List of Section.

7. Select the Nature of Good(s).

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8. Select the Collectee Status.

9. Select the Residential Status.

10. Select either bank or cash ledger in the Cash/Bank field.

11. Press Enter.

12. Enter Narration, if required.

The Payment invoice will be automatically filled with the relevant details, as
shown below:

13. Press Ctrl + A to save the invoice.

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10. Press Ctrl + A to save the invoice.

Form 27EQ (TCS)

As per the Income Tax Act, 1961, every corporate and government entity responsible
for collection of tax at source should furnish TCS returns containing details of
collectee(s) and challan details relating to deposit of tax with the Income Tax
Department. Form 27EQ is the quarterly return statement for TCS. The due dates
for filing returns are July 15th, October 15th, January 15th, and for the last quarter,
April 30th.

The Form 27EQ report in Tally.ERP 9 assists you in generating accurate the returns
to be filed.

The report can be drilled down to the voucher entry level to display complete
information of each transaction.

To generate the Form ER1

1. Go to Gateway of Tally > Display > Statutory Reports > TCS Reports > Form
27EQ

2. Click F1: Detailed.

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The statistics screen appears as shown below:

The Form 27 EQ report can be filed with accurate information available in this
report. It has three main sections:

1. Statistics of Vouchers

2. Collection Details

3. Payment Details

Total Number of Vouchers

This displays the total number of transactions which are considered for the
generation of Form 27 EQ.

● Press Enter on Total Number of Transactions to view the Statistics of

Vouchers.

Included Transactions

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Transactions that will be considered as Included for generating Form 27EQ:

● Sales entries in the current period, with TCS collection

● Entries recorded in Debit Note/Journal voucher for increase in sales value

and/or TCS value

● Entries for payments received in advance from collectee

● TCS adjustment entries

● Entries accounting for TCS reversals and TCS deduction w.r.t escalations and
de-escalations

● TCS ‘book entries’ for collections made by or on behalf of the Government

Excluded Transactions
These are transactions that do not carry the TCS details that are requisite to
generate Form 27EQ, and hence will be excluded while generating the form.
Transactions that will be considered as Excluded for generating Form 27EQ:

● All entries where TCS is not applied

● Entries recorded using any of the following Voucher Types:

o Payment

o Contra

o Inventory Vouchers

o Order Vouchers

o Debit Note (entries with no TCS implications)

o Credit Note (entries with no TCS implications)

o Vouchers marked as Optional

o Reversing Journal

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o Memorandum Vouchers

o Payroll Vouchers

o Journal Vouchers recorded with adjustment entries not related to TCS

● Press Enter on Excluded Voucher Details to view the Excluded Voucher

Details.

Uncertain Transactions
It displays the complete list of information gaps found in transactions. Until these
details are specified, either in masters or transactions, the transaction cannot be
considered for filing return. It consists of two broad categories,

● Master Related Exceptions

● Transactions Related Exceptions

All the transactions which are displayed here requires user’s intervention to provide
the appropriate details. Provision to completely exclude uncertain transactions is
also made available. Hence, any transaction which has information gaps but is not
required to be shown in the quarterly return, can be moved to Excluded
Transactions.

Collection Details
Details of all TCS entries are listed here under two heads:

● Collection at Normal Rate

● Collection at Zero Rate

Payment Details
This will contain the statistics of all TCS payments (deemed or actual) that exist in the
data till date. This will not contain any of the payment entries that are not related to
the current period. Any payment entries other that TCS payment entry will not
appear here.

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Included Transactions

All the TCS payment to department till date which is applicable for the report period,
will be listed as Included Transactions under this section.

Not Included Transactions

Payment transactions that may possibly be TCS payments, but cannot be

ascertained due to missing information, will be listed here. Transactions will be
listed here under the following circumstances:

● The Duty Type has not been set for the duty ledger

● The type of TCS Payment is not available. That is, whether the payment is
made towards Late Fee, Interest, Income Tax, Surcharge, Education Cess,
Secondary Education Cess, or Other Payments.

● Details of the bank where the payment has been made, is unavailable

● The period for which the payment is made, is not available

● The payment entry has not been linked to a deduction entry

● The payment amount has not been rounded off. As per rules, TCS payments
need to be rounded off figures.

Payment Summary
All payment vouchers that have been ‘included’ for generating returns, will be
captured in this section based on the category of payment.

Drill down to view the Payment Voucher report, where the date, voucher number,
duty type (education cess, secondary education cess, etc.) and the respective
amount, payment type (Interest, Late Fee, etc.) and the respective amount, and the
total amount paid.

Drill down further to view the Deduction Voucher report, the following details will be
displayed:

● Party Name

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● Collectee Type

● PAN

● Rate

● Assessable Value

● Income Tax

● Surcharge

● Education Cess

● Secondary Education Cess

● Total amount paid

Budgetary Changes 2016-17

As per the Union Budget for the financial year 2016-17, three new natures of goods
have been introduced, which are described below.

● Sale of Motor Vehicle: Attracts 1% TCS if the value exceeds the threshold
limit of Rs. 10,00,000.

● Sale in Cash of Any Goods (Other Than Bullion/Jewellery): Attracts 1% TCS

if the value exceeds the threshold limit of Rs. 2,00,000.

● Providing of Any Services (Other Than Ch-XVII-B): Attracts 1% TCS if the

value exceeds the threshold limit of Rs. 2,00,000.

To create the nature of goods

1. Go to Gateway of Tally > Accounts Info. > Statutory Info. > TCS Nature of
Goods > Create.

2. Press Ctrl+C to view the List of Nature of Goods.

3. Select Sale of Motor Vehicle.

4. Enter the Rate.

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5. Enter the Threshold/exemption limit as 10,00,000. The TCS Nature of
Goods screen appears as shown below:

6. Press Enter to accept.

Similarly, create the nature of goods for Sale in Cash of Any Goods (Other
Than Bullion/Jewellery) and Providing of Any Services (Other Than Ch-XVII-
B) as shown below:

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Payroll in Tally.ERP 9

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Payroll in Tally.ERP 9
Employee
PT
Database

Leave &
ESI Attendance

Payroll
Overtime /
PF
Production

Salary Revision Pay Heads

& Increments
Loans &
Advances

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Features of Payroll
• Instant Access to Employee Information

• Pay the right amount - on time

• Manage Increments and Arrears

• Loans and advances

• Meet all accounting and Regulatory norms

• Payroll and Statutory Reports

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Instant Access to Employee Information
• Centralized Database for Employees

• Instant access to Personal, Statutory and

Expat details

• Manage Employees by Groups, Designation,

Location and Shifts etc.

• Complete lifecycle support - Joining to

Resignation

• Manage – Attendance, Leave, Overtime and

Production details

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Pay the right amount - on time
• Salary Calculation as per your specific business
needs

• Flexibility to define the method of Salary

Calculation

• Payment Advice to bank- for on time Salary

Payment

• Email Pay slips to Employees on click of a button

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Improve employee satisfaction

• Handle Salary Revision

• Instant Arrears Calculation

• Manage the impact of Salary increment on PF,

ESI and PT

• Handle Bonus and Gratuity

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On time recovery of loans and advances

• Flexible options for Loan recovery

• Recover Loan while processing payroll or

separately

• Facility to track the Loans recovered

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Meets accounting and Regulatory norms -instantly

• Integrated with Accounts – save time

• Compliance for PF, ESI and PT as per the

central and state rules

• All required Payroll and Statutory Reports

and Forms are provided

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Payroll and Statutory Reports - 1
• Payroll Reports
• Pay Slip
• Pay Sheet
• Payroll Statement
• Payment Advice
• Payroll Register
• Employee Profile
• Employee Pay Head Breakup
• Pay Head Employee Breakup
• Attendance Reports
• Attendance Sheet
• Attendance Register

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Payroll and Statutory Reports - 2
• Expat Reports
• Passport Expiry
• Visa Expiry
• Contract expiry
• PF Reports
• Form 5
• Form 10
• Form 12A
• Monthly Statement
• Form 3A (hard copy and E-return format)
• Form 6A
• Computation

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Payroll and Statutory Reports - 3
• ESI Reports
• Form 3
• Monthly Statement
• Form 5
• Form 6
• Computation
• Professional Tax
• Computation sheet
• Statement
• Gratuity
• Gratuity Summary

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Upcoming Enhancements - 1
• Leave Management (all scenarios)
• Encashable / Non Encashable
• Carry Forward / No Carry Forward
• Accrual method – Monthly, Quarterly,
Half yearly, Yearly
• Compensatory Holidays

• Employee Details
• Employee Auto Numbering
• Photo
• Other statistics

• Multi-classification for Employees

with History

• Formulae Builder

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Upcoming Enhancements - 2
• CTC Based Calculation

• New Pay Process

• Single click

• Category-wise process

• Selective Employees

• Full & Final Settlement

• Employee Self Service

• Pay Slip Designer

• Incremental Slab calculation

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Thank you

Attitude Academy
B-2/19 A, Yamuna vihar,
Delhi-110053
Tel : 011-43522158
Email: info@attitudetallyacademy.com

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Implementation of
Payroll in Tally.ERP 9
The information contained in this document is current as of the date of publication and subject to change. Because Tally must respond
to changing market conditions, it should not be interpreted to be a commitment on the part of Tally, and Tally cannot guarantee the
accuracy of any information presented after the date of publication. The information provided herein is general, not according to
individual circumstances, and is not intended to substitute for informed professional advice.

This document is for informational purposes only. TALLY MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS
DOCUMENT AND SHALL NOT BE LIABLE FOR LOSS OR DAMAGE OF WHATEVER NATURE, ARISING OUT OF, OR IN
CONNECTION WITH THE USE OF OR INABILITY TO USE THE CONTENT OF THIS PUBLICATION, AND/OR ANY
CONDUCT UNDERTAKEN BY PLACING RELIANCE ON THE CONTENTS OF THIS PUBLICATION.

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copyrights, rights of translation, etc., are vested exclusively with TALLY SOLUTIONS PRIVATE LIMITED. No part of this document
may be reproduced, translated, revised, stored in, or introduced into a retrieval system, or transmitted in any form, by any means
(electronic, mechanical, photocopying, recording, or otherwise), or for any purpose, without the express written permission of Tally
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document. Except as expressly provided in any written licence agreement from Tally, the furnishing of this document does not give you
any licence to these patents, trademarks, copyrights, or other intellectual property.

© 2009 Tally Solutions Pvt. Ltd. All rights reserved.

Tally, Tally 9, Tally9, Tally.ERP, Tally.ERP 9, Shoper, Shoper 9, Shoper POS, Shoper HO, Shoper 9 POS, Shoper 9 HO,
TallyDeveloper, Tally Developer, Tally.Developer 9, Tally.NET, Tally Development Environment, Tally Extender, Tally Integrator,
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Tally Solutions Pvt. Ltd. in India and/or other countries. All other trademarks are properties of their respective owners.

Version: Implementation of Payroll in Tally.ERP 9/1.8/June 2010

Contents

Introduction ............................................................................................................................................................................... 1

Lesson 1: Configuring Payroll in Tally.ERP 9

Salient Features of Payroll in Tally.ERP 9................................................................................................. 2
Enabling Payroll in Tally.ERP 9 .................................................................................................................. 3

Lesson 2: Creation of Payroll Masters

Employee Setup .............................................................................................................................................. 9
Employee Groups ..................................................................................................................................... 9
Employee Master .................................................................................................................................... 10
Payroll Masters ............................................................................................................................................. 12
Payroll Units .......................................................................................................................................... 12
Attendance/ Production Types ................................................................................................................ 14
Pay Heads ...................................................................................................................................................... 16
Earning Pay Heads ................................................................................................................................ 17
Deduction Pay Heads ............................................................................................................................. 33
Gratuity Pay Head.................................................................................................................................. 44
Salary Details Setup .................................................................................................................................... 47

Lesson 3: Processing Payroll in Tally.ERP 9

Attendance Vouchers ................................................................................................................................... 56
Payroll Vouchers .......................................................................................................................................... 64
Cash Remittance ..................................................................................................................................... 64
Bank Transfer ......................................................................................................................................... 69
Payment of Salaries (Salary Disbursement) ........................................................................................... 74

Lesson 4: Accounting for Employer PF Contributions

Creation of Employer PF Contribution Masters ...................................................................................... 79
Salary Details setup ..................................................................................................................................... 93
Processing Employer PF Contribution ...................................................................................................... 95
Processing PF Admin Expenses................................................................................................................. 98
Payment of Provident Fund ..................................................................................................................... 102

Lesson 5: Accounting for Employer ESI Contributions

Creation of Employer ESI Contribution Masters .................................................................................. 111
Salary Details setup ................................................................................................................................... 115
Processing Employer ESI Contribution .................................................................................................. 117
Payment of ESI ........................................................................................................................................... 119

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Contents

Lesson 6: Payment of Professional Tax

6.1 Processing of Professional Tax Payment ................................................................................................ 128

Lesson 7: Tracking of Salary Advances / Loans

Creation of Masters .................................................................................................................................... 133
Modify / Alter Salary Details ................................................................................................................... 135
Payment of Salary Advance...................................................................................................................... 136
Recovery of Salary Advance .................................................................................................................... 140

Lesson 8: Accounting for Pay Revision & Arrears

Salary Revision / Arrear Calculation for Prior Period .......................................................................... 143
Salary Revision / Arrear Calculation for current Period ...................................................................... 149

Lesson 9: Processing Payroll for Contract Employees

Create Employee Masters ......................................................................................................................... 155
Create Pay Heads ....................................................................................................................................... 156
Record Attendance details ........................................................................................................................ 159
Process Payroll ........................................................................................................................................... 161

Lesson 10: Payroll Reports

Payroll Reports ........................................................................................................................................... 164
Pay Slip 165
Multi Pay Slips ....................................................................................................................................177
Pay Sheet .............................................................................................................................................181
Payroll Statement ................................................................................................................................192
Payment Advice ...................................................................................................................................196
Payroll Register...................................................................................................................................199
Employee Pay Head Breakup ..............................................................................................................201
Pay Head Employee Breakup ..............................................................................................................205
Attendance Sheet .................................................................................................................................208
Attendance Register ...........................................................................................................................211
Expat Reports.............................................................................................................................................. 213
Passport Expiry Report .......................................................................................................................213
Visa Expiry Report ..............................................................................................................................215
Contract Expiry Report .......................................................................................................................217
Payroll Statutory Reports .......................................................................................................................... 218
Provident Fund Reports ......................................................................................................................219
Employee’s State Insurance Reports....................................................................................................236
Professional Tax Reports .....................................................................................................................252
Gratuity Report....................................................................................................................................257

ii
Introduction

The term Payroll refers to a series of accounting transactions involved in the process of paying
employees for the services rendered after taking all the statutory and non-statutory deductions
into account, in conformance with the terms of employment, company policy and the law of the
land i.e., payment of payroll taxes, insurance premiums, employee benefits and other deductions.

An efficient payroll system facilitates an error-free, accurate and timely employee payment while
ensuring that the employment is well within the valid work permit.
Lesson 1: Configuring Payroll in Tally.ERP 9

Lesson Objectives
On completion of this lesson, you will have learnt:

□ The features of Payroll in Tally.ERP 9

□ How to enable Payroll in Tally.ERP 9

Payroll in Tally.ERP 9 is easy to use and can handle all the functional, accounting and statutory
requirements of the payroll department.

Salient Features of Payroll in Tally.ERP 9

The key features of the Payroll functionality in Tally.ERP 9 are as follows:
□ It is fully integrated with accounts to give you the benefits of simplified Payroll processing
and accounting.
□ It has user defined classifications and sub-classifications for comprehensive reporting.This
may be related to the employees, employee groups, pay components, departments etc.
□ It provides the facility to create user-defined earnings and deductions Pay Heads.
□ It allows flexible and User-definable criteria for simple or complex calculations.
□ It allows unlimited grouping of Payroll Masters.
□ It supports user-defined production units i.e., attendance/ production/ time based remuner-
ation units.
□ It provides a flexible payroll processing period.
□ It provides comprehensive Cost Centre as well as employee-wise costing reports
□ It ensures an accurate & timely Salary Processing, Employee Statutory Deductions &
Employer Statutory Contributions with the help of predefined processes.
□ It provides auto-fill facility to expedite the Attendance, Payroll & Employer Contributions
processes.

2
□ It facilitates an accurate computation and deduction of ESI, EPF, Professional Tax, Gratuity
etc.
□ It helps in the generation of Statutory Forms & Challans for EPF & ESI, as prescribed.
□ It allows to drill-down to voucher level for any kind of alteration.
□ It facilitates computation of arrears pertaining to prior period(s).
□ It helps in tracking employee loan details.

Enabling Payroll in Tally.ERP 9

In Tally.ERP 9 activation of Payroll requires a one time simple setup. Create a new company in
Tally.ERP 9 and follow the steps given below to enable Payroll.

Case Study Company

M/s. Spectrum Software Solutions is engaged in the Software services Business. It is a
Bangalore-based company with the following three major departments:
□ Sales
□ Administration
□ R&D

Step 1: Company Setup

Go to Gateway of Tally > Company Info. > Create Company
In the Company Creation screen,
□ Select India in the field Statutory compliance for from the List of Countries provided
□ Type 1-4-2009 as the Financial Year from date and press Enter
The completed Company Creation screen is displayed as shown:

Figure 1.1 Company Creation screen

□ Press Enter to Accept the completed Company Creation screen

Step 2: Enable Payroll

Go to Gateway of Tally > Press F11: Company Features > press F1: Accounting Features
In the F11: Accounting Features screen:
□ Set Maintain Payroll to Yes
□ Set More than ONE Payroll / Cost Category to Yes
Configuring Payroll in Tally.ERP 9

The completed F11: Accounting Features screen is displayed as shown:

Figure 1.2 F11: Accounting Features screen

□ Press Enter to Accept the F11: Accounting Features screen

The option More than ONE Payroll / Cost Category is set to Yes, when
separate cost categories are created to allocate Employee cost. In cases,
where only one cost category i.e., primary cost category is used to allocate
multiple cost centres, this option may be set to No.

Once the Payroll feature is activated in Tally.ERP 9, the following two new options get activated in
the F11: Statutory & Taxation Master

Step 3: Enable Payroll Statutory Features

Go to Gateway of Tally > press F11: Company Features > press F3: Statutory & Taxation
In F11: Statutory & Taxation Features screen:
□ Set Enable Payroll Statutory to Yes

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Configuring Payroll in Tally.ERP 9

□ Set Set/Alter Payroll Statutory Details to Yes

Figure 1.3 F11: Statutory & Taxation Features screen

□ Press Enter

In the Payroll Statutory Details screen:

□ Enter the Provident Fund & Employee State Insurance details of the company as
shown:

Figure 1.4 Payroll Statutory Details screen

6
Configuring Payroll in Tally.ERP 9

Provident Fund
Company Code: This field denotes the Provident Fund Code of the Com-
pany allotted by the Department.
Company Account Group Code: This field denotes the Provident Fund
Group Code of the Company allotted by the Department.
Company Security Code: This field denotes the Security Code of the Com-
pany allotted by the Department.
Employee State Insurance
Company Code: This field denotes the ESI Code of the Company allotted by
the Department.
ESI Branch Office: This field denotes the nearest ESI office under whose
jurisdiction, the company is situated.
Standard Working days (per month): This field denotes the consistent Pay
Period to be considered for ESI Calculation. If this field is left blank, the calcu-
lation is done based on the Calendar days in each month.

□ Press Enter to Accept the screen and go back to F11: Statutory & Taxation Features
screen
□ Press Ctrl+A to Accept the screen.

7
Lesson 2: Creation of Payroll Masters

Lesson Objectives
On completion of this lesson, you will have learnt how to:

□ Create Payroll Masters in Tally.ERP 9

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Creation of Payroll Masters

The Payroll feature in Tally.ERP 9 requires minimal effort for accurate payroll processing. It takes
five easy steps to process payroll & generate Pay Slip in Tally.ERP 9.

Figure 2.1 Payroll Cycle

Essentially, Payroll involves the calculation of amounts due for an employee on the following
basis:
□ Pay on Hourly wages
□ Pay on a fixed basis such as certain amount per week, per month and so on
□ Pay to sales persons on commission
□ Reimbursement of expenses such as travel expenses, either as paid by the employee or
based on per item rate
□ Pay on the basis of number of pieces produced/ manufactured/ sold

It is therefore essential to quantify the following payroll information for the purpose of computation
of payments to employees. For this purpose, the following Payroll masters have to be created in
Tally.ERP 9 in the manner as discussed:
□ Employee Masters
□ Payroll Masters
□ Pay Heads

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Creation of Payroll Masters

□ Salary Details

Employee Setup
The Employee Master records employee information – department, date of joining, date of
leaving, ID number, designation, location, function, employee bank details, statutory details,
Passport and Visa details, and so on.

Tally.ERP 9 provides the flexibility to create the Employees and Group them under specific
Employee Group which in turn can be created under specific Employee Categories.

The following masters can be created in Tally.ERP 9 to successfully record the Employee Details:
□ Employee Category
□ Employee Groups
□ Employees

The Employee Category will provide an additional level to classify the

Employees in a logical manner. In the case study, in this book all the
Employee Groups are created under Primary Cost Category, hence creation
of an additional Category is not shown.

Employee Groups
Businesses with multiple departments, divisions, functions or activities may create the required
employee groups and classify individual employees under a specified group i.e., Production,
Sales, Marketing, Stores, Support or a particular group of employees such as managers, supervi-
sors, sub-staff and so on.

To create Sales as an Employee Group:

Go to Gateway of Tally > Payroll Info. > Employee Groups > Create
In the Employee Group Creation screen,
1. Select Primary Cost Category as the Category (You can also create a separate cost cate-
gory to segregate Employee Cost based on respective categories)
2. Type Sales as the Name of the Employee Group
3. Select the group as Primary (Tally.ERP 9 allows an unlimited grouping of Employee Groups)

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Creation of Payroll Masters

The Employee Group Creation screen is displayed as shown:

Figure 2.2 Employee Group Creation screen

4. Press Enter to Accept the Employee Group Creation screen

Similarly, create the other Employee Groups such as Administration and R&D.

Employee Master
After creating the Employee Groups, create individual Employee Masters, with or without
grouping them, under the Employee Group Master.
In Tally.ERP 9, you can record all the necessary information of the employees in the Employee
Masters. Tally.ERP 9 also allows you to enter the Statutory, Expat and Contract details of the
employees.
To display the options for entering the Statutory, Expat and Contract details enable these options
from the Company Configuration screen as explained below:
Go to Gateway of Tally > F12:Configure > Payroll Configuration
Set the following options:
□ Show Statutory Details to Yes
□ Show Passport & Visa Details to Yes
□ Show Contact Details to Yes

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Creation of Payroll Masters

The F12: Payroll Configuration screen is displayed as shown:

Figure 2.3 F12: Payroll Configuration screen

□ Press Enter to Accept

Tally.ERP 9 allows you to configure the above settings from the Employee
Creation screen by pressing F12: Configure.
□ The information to be printed in the Payment Advice is automatically pre-
filled in Tally.ERP 9. However, you can also modify the same as per your
requirements.
□ Pay Slip Note will be printed if you does not want the Authorised details
to be printed while emailing or printing the Pay Slips if set to Yes in the
F12: Configuration.
□ A customised message for specific occasion can be entered as Pay Slip
Message and will be printed if set to yes ion F12 screen while emailing
or printing.

Create the following Employee Masters:

Employee Name Department Date of Joining
Vijay Kumar Administration 1-4-2009
Rahul R&D 1-4-2009
Mahesh Sales 1-4-2009
Ajay Sales 1-4-2009
Go to Gateway of Tally > Payroll Info. > Employees > Create
In the Employee Creation screen,
1. Select the Primary Cost Category as the Category
2. Type the Name of the Employee as Vijay Kumar
3. Specify the Name of the Employee Group as Administration in the field ‘Under’

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Creation of Payroll Masters

4. Specify the Date of Joining as 01-04-2009

5. Type the other details of the employee as shown:

Figure 2.4 Employee Creation screen

6. Press Enter to Accept the screen

The option Date of Leaving and Reason for Leaving will be available only in
the Alteration mode.

Similarly, create the Employee Masters for other employees with their respective departments.

Payroll Masters
As discussed in the above section Pay components are computed based on the Payroll Units.
Therefore, create the following Payroll masters in Tally.ERP 9:
□ Payroll Units
□ Attendance / Production Types
Payroll Units
A payroll unit refers to a unit of measurement based on which pay heads are calculated. Payroll
units can be classified into two types viz., Simple Payroll Units and Compound Payroll Units.
Simple Payroll Units refer to individual units such as Day, Week, Month, Hours, Pcs, Box, Nos
etc., Whereas, Compound Payroll Units refer to Units which are combination of two simple units,
i.e., an Hour of 60 Minutes, Month of 26 days, Day of 8 Hrs.
Usually, the Pay components are computed based on a single or compound payroll units.
Sometimes an employee may be paid on the basis of a combination of two or more units. For

12
Creation of Payroll Masters

example, an employee is paid a regular salary and an hourly rate for the overtime hours. In this
case, the two likely units are Calendar Month and Hours. In Tally.ERP, you can create simple as
well as compound units.
By default, Tally.ERP 9 contains four preset Calculation Periods – Days, Fortnights, Months &
Weeks. However, you can also create new Payroll Units based on your business requirements.
Name Type Symbol
Hours Simple Hrs
Minutes Simple Mins
Hrs of 60 Mins Compound Hrs of 60 Mins

i. Simple Payroll Units

Go to Gateway of Tally > Payroll Info. > Units (Work) > Create
In the Unit Creation screen,
1. Simple is defaulted as the Type of Unit
2. Specify Hrs as the Symbol
3. Type Hours as the Formal Name
4. Specify 2 as the Number of Decimal Places

The completed Unit Creation screen is displayed as shown:

Figure 2.5 Simple Unit Creation screen

5. Press Enter to Accept the Unit Creation screen.

Similarly, create Minutes as another Simple Unit.

ii. Compound Payroll Units

Create Hrs of 60 Mins as a Compound Unit.
In the Unit Creation screen:
1. Press Backspace and select Compound as the Type of Unit
2. Specify Hrs as the First Unit
3. Enter 60 as the Conversion

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Creation of Payroll Masters

4. Specify Mins as the Second Unit

Figure 2.6 Compound Unit Creation screen

5. Press Enter to Accept the Unit Creation screen.

Types of Units:
□ Simple Units are individual units with no relationship with other units
i.e., Hrs, Nos, Pieces and so on.
□ Compound Units are a combination of two simple units, where the two
units have an arithmetical relationship with each other. For example, an
Hour of 60 Minutes.

Attendance/ Production Types

Attendance/Production Type masters are used to record the nature of attendance/ production i.e.,
time and work rate. In Tally.ERP 9, you can create Attendance types based on time such as
Present and Absent or based on work based production units such as Piece productions,
Sales performance and so on.

Create the following Attendance Types for M/s. Spectrum Software Solutions.
Name Under Attendance/Production Type Period Type
Present Primary Attendance/ Leave with Pay Days
Absent Primary Leave without Pay Days
Overtime Primary Production Hrs of 60 Mins

i. Present Attendance Type

Go to Gateway of Tally > Payroll Info. > Attendance / Production Types > Create
In the Attendance Type Creation screen,
1. Type Present as the Name of the Attendance type
2. Specify the group as Primary in the field ‘Under’. By default primary is selected.

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Creation of Payroll Masters

3. Select Attendance/ Leave with Pay as the Attendance Type and the Period Type appears
as Days, by default.

Figure 2.7 Attendance/ Production Type Creation screen

The completed Attendance Type Creation screen is displayed as shown:

Figure 2.8 Attendance/Production Type Creation Screen

4. Press Enter to Accept the Attendance Type Creation screen.

Similarly, create another Attendance Type as Absent. Enter Leave without Pay in the field
Attendance Type.
ii. Absent Attendance Type
The completed Attendance Type Creation screen is displayed as shown:

Figure 2.9 Attendance/ Production Type Creation screen

□ Press Enter to Accept the Attendance Type Creation screen.

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Creation of Payroll Masters

In the same way, create Overtime as the Production Type with Production as the Attendance
Type.

iii. Overtime Production Type

The completed Overtime - Production Type Creation screen is displayed as shown below:

Figure 2.10 Overtime - Production Type Creation screen

□ Press Enter to Accept the Production Type Creation screen.

Attendance/Production Types details:

□ Present Attendance Type may be used when the pay value is

measured on the basis of positive attendance units, i.e. number of days
present.
□ Absent Attendance Type may be used when the pay value is
measured on the basis of negative attendance units, i.e. number of days
absent.
□ Production Attendance Type may be used when the pay value is
measured on the basis of units produced, for e.g., number of boxes
produced.
□ User Defined Calendar Type may be used to allow the per day pay
value calculation when the user want to have different number of work-
ing days in each month by considering the Holidays and Sundays etc..
in January 23 days, in Febraury 24 days, in March 25 days etc.

Pay Heads
Pay Heads may be broadly considered as Earnings and Deductions from an employee’s point of
view. However, these pay heads would still be Expense and Liability from the employer’s view
point.
Some examples of Earnings Pay Heads are Basic Salary, Dearness Allowance, City Compensa-
tory Allowance, House Rent Allowance, Night Shift Allowance, Uniform Allowance, Sales Com-
mission and so on. Some examples of Deductions pay heads are Employees’ Provident Fund
(EPF), Employees’ State Insurance (ESI), Professional Tax, Income Tax, TDS, Advance (if any).

In Tally.ERP 9, each pay head is to be created as an individual ledger account and grouped under
its respective group i.e., all Earnings pay heads under Indirect Expenses group or Direct

16
Creation of Payroll Masters

Expenses group and all Deductions pay heads under Current Liabilities, Current Assets and
Duties & Taxes group.

The preset Pay Head types in Tally.ERP 9 are:

1. Earnings for Employees
2. Deductions from Employees
3. Employees’ Statutory Deductions
4. Employer’s Statutory Contributions
5. Employer’s Other Charges
6. Bonus
7. Gratuity
8. Loans and Advances
9. Reimbursements to Employees
The pay heads marked with the above pay head types will be available during payroll processing,
and if the Pay Head Type is marked as Not Applicable, it will not be available. The Salary
Payable, PF Payable, ESI Payable ledgers should be created by selecting Not Applicable as the
Pay Head Type.

Create the following pay heads in the books of M/s. Spectrum Software Solutions.

Earning Pay Heads

Create the following Earnings Pay Heads:
Pay Head Pay Head Under Affect Name to Use for Calculation Calculation
Name Type Net Sal- Appear Gratuity Type Period/ Pro-
ary in Pay duction Type
Slip
Basic Pay Earnings for Indirect Yes Basic Yes On Attend- Months
Employees Expenses ance
House Earnings for Indirect Yes HRA No As Com- —
Rent Employees Expenses puted Value
Allowance
Convey- Earnings for Indirect Yes Convey- No Flat Rate Months
ance Employees Expenses ance
Overtime Earnings for Indirect Yes Overtime No On Produc- Overtime
Pay Employees Expenses tion
Variable Earnings for Indirect Yes Variable No As User —
Pay Employees Expenses Pay Defined
Value

i. Basic Pay Head Creation

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
In the Pay Heads Creation screen,

17
Creation of Payroll Masters

1. Type Basic Pay as the Name of the Pay Head

2. Select Earnings for Employees in the field Pay Head Type.

The Pay Head Creation screen is displayed as shown:

Figure 2.11 Basic Pay Head Creation – Pay Head Type Selection

3. Specify the group as Indirect Expenses in the field Under and press Enter
4. Set Affect Net Salary to Yes
5. Specify Basic in the field Name to appear in Pay Slip
6. Set Use for Gratuity to Yes
7. Select On Attendance in the field Calculation Type and press Enter

Description of general parameters in Pay Head creation:

Affect Net Salary – If this option is set to Yes, then the Pay Head will appear
in the Salary Slip for calculation of Net salary.
Name to appear in the Pay Slip – If Affect Net Salary is set to Yes, then the
required name for the Pay Head that appears in the Pay Slip should be spec-
ified against this field.
Use for Gratuity – This parameter should be set to Yes, for the Pay Head
components that will be used for the Gratuity calculation (e.g. Basic and DA

18
Creation of Payroll Masters

The Pay Head Creation screen with the List of Calculation is displayed as shown:

Figure 2.12 Basic Pay Head Creation - Calculation Type

Calculation Type refers to the method of computation of pay components. In

Tally.ERP 9, there are basically 5 calculation types.

As Computed Value – This method is used when the pay value is computed
based on certain predefined factors i.e., slab rates, pay heads and so on.
As User-Defined Value – This method is used when the value of pay is not
fixed and does not depend upon any pay components.
Flat Rate – This method is used when the value of the pay heads is fixed for
the given month. This calculation type is not dependant upon attendance/pro-
duction. For example, conveyance of Rs. 800 per month.
On Attendance — This calculation type depends upon Attendance records
and is used along with rate per unit of attendance. For example, Overtime of
Rs. 25 per hour.
On Production — This method is used when the pay value is measured
based on work done i.e., pieces or numbers produced/manufactured.

8. Select Present in the field Attendance/ Leave with Pay.

19
Creation of Payroll Masters

The Pay Head Creation screen with the List of Attendance Types is displayed as shown below:

Figure 2.13 Pay Head Creation screen with List of Attendance Types

If the user intends to record Negative Attendance viz., Absent (i.e if the pay
value is measured on the basis of negative attendance units), select Not
Applicable in the Attendance/ Leave with Pay field and press Enter & then
select Absent in the Leave without Pay field. In the above example we are
selecting Positive Attendance unit i.e Present.

9. Select Months in Calculation period field and press Enter

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Creation of Payroll Masters

The Pay Head Creation screen with the List of Calculation Periods is displayed as shown:

Figure 2.14 Pay Head Creation - Calculation Period selection

Tally.ERP 9 contains four predefined Calculation periods – Days, Fortnights,

Months and Weeks.

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Creation of Payroll Masters

10. Select User defined in the Per Day Calculation Basis field

Figure 2.15 Pay Head Creation screen - Calculation Basis Selection

11. Press Enter to Accept

Calculation Basis refers to the periodicity of the given calculation period.

□ As per Calendar Period refers to the perpetual calendar month, i.e. if
the payroll process is carried out for the month of March, then the attend-
ance records will be entered for 31 days.
□ User Defined Value refers to the consistent payroll period irrespective of
calendar month, i.e. If an employee’s salary is based on a standard
month of 30 days irrespective of the calendar month, then you can select
User Defined as the Calculation Basis and define the periodicity of the
specified period or month.
For example, an employee’s monthly salary is Rs. 3,000 and the calculation
basis is defined as a month of 30 days. If he takes 3 days leave in January
(which consists of 31 days), then the salary per day is computed as (Rs.
3000/30 days, i.e. 100). The net salary after deducting the leave salary [i.e.
Rs. 300 (3 days x Rs. 100)] amounts to Rs. 2,700.
□ User Defined Calendar Type will provide flexibility to change the per
day salary for the Employee based on the User Defined Calendar days.
For example, for Basic salary of 3000 if the number of days in a month are
defined as 30 then per days salary will be Rs. 100. In the next month if the
number of days is 25 then per day salary will be Rs. 120.

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Creation of Payroll Masters

12. Specify the Months of 26 Days and press Enter

Figure 2.16 Pay Head Creation screen - Calculation period

13. Select Normal Rounding as the Rounding Method and press Enter.

Figure 2.17 Pay Head Creation screen – Rounding Method selection

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Creation of Payroll Masters

14. Specify 1 as the rounding Limit (The Rounding limit allows the value to be in multiples of the
limit specified and is based on the Rounding Method selected)

There are 4 methods of Rounding Off in Tally.ERP 9 which are as follows:

□ Not Applicable – The decimal points will be taken into consideration,

and the amount will not be rounded off.
□ Downward Rounding – The decimal points will not be taken in to con-
sideration and the amount will be rounded off to the lower value.
□ Normal Rounding – The amount will be rounded off to the nearest cur-
rency value.
□ Upward Rounding – The amount will be rounded off to the higher value.

The completed Basic Pay Head Creation screen is displayed as shown:

Figure 2.18 Completed Basic Pay Head Creation screen

15. Press Enter to Accept the screen.

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Creation of Payroll Masters

ii. House Rent Allowance Pay Head Creation

In the Pay Head Creation screen,
1. Type House Rent Allowance as the Name of the Pay Head
2. Select Earnings for Employees in the field Pay Head Type
3. Specify the group as Indirect Expenses in the field Under and then press Enter
4. Set Affect Net Salary to Yes
5. Specify HRA as the Name to appear in Pay Slip
6. Set Use for Gratuity to No
7. Select As Computed Value in the Calculation Type field and press Enter

Figure 2.19 HRA Pay Head Creation screen - Calculation Type selection

8. Select Normal Rounding as the Rounding Method and 1 as the rounding Limit and press
Enter

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Creation of Payroll Masters

9. In the Computation Info screen, select On Specified Formula in the Compute field

Figure 2.20 Pay Head Creation screen with Compute method

Computation on details:

On Current Deductions Total – This calculation type is used when the value
of a pay head depends upon the total of the deductions pay heads previously
defined.
On Current Earnings Total – This calculation type is used when the value of
a pay head depends upon the total earnings pay heads previously defined.
On Current Sub Total – This calculation type is used when the value of a
pay head depends upon the net totals of earnings and deductions previously
defined.
On Specified Formula – This calculation type is used when the pay head
value is computed on the value of one or more pay heads already defined in
the pay structure. (Tally.ERP 9 allows the addition and subtraction of pay
heads already defined in the pay structure and multiplication and divisions
using attendance types. For example, HRA is computed as 40% of the basic
salary.)

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Creation of Payroll Masters

10. Press Enter and the Compute subscreen is displayed

11. In the Sub-screen Compute:
■ Select Basic Pay as the Add Pay Head function and press Enter

Figure 2.21 Compute sub-screen

The pay head drop-down box contains pay heads already created. If any pay head(s) is a
component for the given Pay Head, you may create the required Pay Head by pressing Alt+C
from the above Pay Head field and make the necessary alterations in the required pay head.

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Creation of Payroll Masters

■ Select End of List

Figure 2.22 Compute: On Specified Formula sub-screen

■ Press Enter to Accept the screen

12. Specify 1-4-2008 as the Effective From date (In case of a revision in pay structure, you can
define the revised computation information for the given pay head, by giving the effective from
date)
13. The From Amount column is automatically skipped, assuming it to be zero. Press Enter to
skip the Amount Upto column

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Creation of Payroll Masters

14. Select Percentage as the Slab Type from the List of Slabs

Figure 2.23 Pay Head Creation screen - Slab Type selection

Slab Type Details:

Percentage – This Slab rate is used when the amount is stated as a propor-
tion of a whole.
Value – This Slab rate is used when the amount is stated as absolute value.

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Creation of Payroll Masters

15. Specify 40% in the Value Basis field and press Enter

Figure 2.24 Pay Head Creation - Value Basis screen

The completed House Rent Allowance (HRA) Pay Head Creation screen is displayed as
shown.

Figure 2.25 Completed HRA Pay Head Creation screen

16. Press Enter to Accept the screen

30
Creation of Payroll Masters

iii. Conveyance Pay Head Creation

Create the Conveyance Pay Head with Calculation Type as Flat Rate.
The completed Conveyance Pay Head Creation screen is displayed as shown:

Figure 2.26 Conveyance Pay Head Creation

□ Press Enter to Accept the screen

31
Creation of Payroll Masters

iv. Overtime Pay Head Creation

Create the Overtime Pay Head with Calculation Type as Production.

The completed Overtime Pay Head Creation screen is displayed as shown:

Figure 2.27 Overtime Pay Head Creation screen

□ Press Enter to Accept the screen

32
Creation of Payroll Masters

v. Variable Pay Head Creation

Similarly, create the Variable Pay Head with Calculation Type as User Defined Value.

Figure 2.28 Variable Pay Head Creation

Deduction Pay Heads

Create the following Deduction Pay Heads.

Pay Head Pay Head Statutory Under Affect Name to Calcula- Computation
Name Type Pay Type Net Appear in tion Type Method
Salary Pay Slip
Employees’ Employees’ PF Current Yes EPF @ 12% As On
PF Contribu- Statutory Account Liabilities Computed Specified For-
tion @ 12% Deductions (A/c No.1) Value mula
Employees’ Employees’ Employee Current Yes ESI @ On Speci- Basic Pay +
ESI Contri- Statutory State Liabilities 1.75% fied For- House Rent
bution @ Deductions Insurance mula Allowance +
1.75% Conveyance +
Overtime Pay
(or Current
Earnings -
Variable Pay)
Profes- Employees’ Profes- Current Yes Profession As On Current
sional Tax Statutory sional Tax Liabilities Tax Computed Earnings Total
Deductions Value

33
Creation of Payroll Masters

i. Employee’s PF Contribution @ 12% Pay Head Creation

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
In the Pay Head Creation screen,
1. Type Employee’s PF Contribution @ 12% as the Name of the Pay Head
2. Select Employees’ Statutory Deductions in the field Pay Head Type and press Enter

Figure 2.29 Employees' PF Contribution @ 12% Pay Head Creation

34
Creation of Payroll Masters

3. Select PF Account (A/c No. 1) in the Statutory Pay Type field as shown:

Figure 2.30 Employees' PF Contribution @ 12% Statutory Pay Type selection

4. Specify the group as Current Liabilities in the field ‘Under’ and press Enter (In Tally.ERP 9,
only relevant groups appear during selection, to reduce erroneous data inputs)
5. Set Affect Net Salary to Yes
6. Specify EPF @ 12% in the field Name to appear in Pay Slip
7. As Computed Value appears in the field Calculation Type by default
8. Select Normal Rounding as the Rounding Method. Specify 1 as the rounding Limit and
press Enter
9. Select On Specified Formula as the Compute method and press Enter

35
Creation of Payroll Masters

10. In the Compute sub-screen, select Basic Pay as the Add Pay Head function and press
Enter

Figure 2.31 Deduction Pay Head Creation screen – Compute On selection

11. Press Enter to Accept the screen

12. Specify 1-4-2008 as the Effective From date
13. The column From Amount is automatically skipped, with the assumption that the amount is
zero

36
Creation of Payroll Masters

14. Specify 6500 in the Amount Upto column and press Enter

Figure 2.32 Deduction Pay Head Creation – Computation Info.

15. Select Percentage as the Slab Type from the List of Slabs
16. Specify 12% as the Value Basis Percentage and press Enter (the From Amount is defaulted
as 6500)
17. Press Enter to accept the upper level as 0 and select Value as the Slab Type from the List of
Slabs

37
Creation of Payroll Masters

18. Specify Rs. 780 in the Value Basis field and then press Enter

Figure 2.33 Deduction Pay Head Creation screen with Value Basis

19. Press Enter twice

38
Creation of Payroll Masters

The completed Employee’s PF Contribution @ 12% Pay Head Creation screen is displayed as
shown:

Figure 2.34 Completed Employee’s PF @ 12% Pay Head Creation screen

20. Press Enter to Accept the screen.

ii. Employee’s ESI Contribution @ 1.75% Pay Head Creation

Create Employee’s State Insurance (ESI) Pay Head as discussed.

In the Pay Head Creation screen,
1. Type Employee’s ESI Contribution @ 1.75% as the Name of the Pay Head
2. Select Employees’ Statutory Deductions in the field Pay Head Type
3. Select ESI in the field Statutory Pay Type
4. Specify the group as Current Liabilities in the field Under and press Enter
5. Set Affect Net Salary to Yes
6. Specify ESI @ 1.75% in the field Name to appear in Pay Slip
7. As Computed Value appears by default in the field Calculation Type
8. Select the option Normal Rounding as the Rounding Method. Specify 1 as the rounding
Limit and press Enter

39
Creation of Payroll Masters

9. Select On Specified Formula in the field Compute and press Enter

Figure 2.35 Employee's ESI Pay Head creation screen - Compute On Selection

In the Compute On Sub-screen, subscreen,

■ Select Basic Pay as the Add Pay Head function and press Enter
■ Select House Rent Allowance as the second Pay Head in the Add Pay Head Func-
tion

40
Creation of Payroll Masters

■ Similarly, select Conveyance and Overtime Pay as the Add Pay Head function

Figure 2.36 Employee's ESI Pay Head creation screen - Add Pay Head selection

■ Select End of List and press Enter

Any income of a regular nature will be subject to ESI calculation viz., Basic
Pay, Dearness Allowance, House Rent Allowance, Conveyance, Overtime
etc.,)

10. Specify 1-4-2008 as the Effective From date

11. The From Amount and Amount Upto fields are skipped as the amount is already entered
in the Statutory & Taxation screen
12. Select Percentage as the Slab Type from the List of Slabs
13. Specify 1.75% as the Value Basis Percentage and press Enter

41
Creation of Payroll Masters

The Pay Head Creation screen is displayed as shown:

Figure 2.37 Employee's ESI Pay Head creation screen – Slab Rate

42
Creation of Payroll Masters

The completed ESI – Employee’s Contribution Pay Head Creation screen is displayed as
shown:

Figure 2.38 Completed ESI – Employee’s Contribution Pay Head Creation screen

14. Press Enter to Accept the screen.

iii. Professional Tax Pay Head Creation

Create Professional Tax Pay Head with the following Slab rates.

From Amount To Amount Professional Tax

Amount
0 5000 0
5000 8000 60
8000 10000 100
10000 15000 150
15000 - 200

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Creation of Payroll Masters

The completed Professional Tax Pay Head Creation screen is displayed as shown:

Figure 2.39 Profession Tax Pay Head Creation

□ Press Enter to Accept

Gratuity Pay Head

Apart from the above Pay Heads, create Gratuity Expenses (Provisional) Account in order to get
provisional Gratuity liability report for the employer at any given period.
Gratuity refers to the monetary benefit given by the employer to the employee at the end of the
employment for the services rendered over a period of employment either by law or otherwise. It
is calculated provisionally at the end of each financial period to assess the possible liability of the
company towards its employees. A Gratuity Provisional Account is created to capture the details
required for the calculation of gratuity. Gratuity is calculated based on select salary components.
The formula used for Gratuity calculation is as follows:

44
Creation of Payroll Masters

* Eligible salary refers to the sum of pay heads covered in the employee’s
latest pay structure, for the relevant period. The pay heads must be set to Yes
for Use for gratuity and the Gratuity ledger should be part of the pay struc-
ture.
# Served period is computed from the date of joining to the end date of cal-
culation period. Served period may be proportionate such as 11 years 10
months and 5 days.
When Served period covers more than one slab, the total of the calculations
of all the slabs will constitute the gratuity provisional amount of the employee.

Ledger Pay Head Type Under

Gratuity Expenses (Provisional) Gratuity Provisions (Current
Liabilities)

In the Pay Head Creation screen,

1. Type Gratuity Expenses (Provisional) as the Name of the Pay Head
2. Select Gratuity in the field Pay Head Type. The Slab Rate details for Gratuity Calculation
screen are displayed.
3. In the Gratuity Calculation subscreen, specify the following details:
■ Specify Gratuity Days of a Month as 26
■ Enter 1 and 60 (months) in the From and To fields under the Number of Months col-
umn
■ Specify 0 in the field Eligibility days for Gratuity Calculation per year
■ Similarly, select 61 and 120 in the From and To fields
■ Specify 15 in the Eligibility days for Gratuity Calculation per year field
■ Press Enter to accept 121 in the field From
■ Specify 15 in the field Eligibility days for Gratuity Calculation per year

45
Creation of Payroll Masters

The Slab Rate Details for Gratuity calculation screen is displayed as shown:

Figure 2.40 Slab Rate Details for Gratuity Calculation screen

4. Press Enter to Accept the screen

Gratuity parameter details:

Gratuity days of a Month – The number of days per calendar month varies
from 28 to 31. In this case, you can apply a consistent period of 26 days
(excluding 4 Sundays) for all employees irrespective of their month of leaving.
It can also be fixed by law.
Number of months From and To – This represents the months until which
the eligible days are applicable in the Slab system, beginning from the date of
joining.
Eligibility days for Gratuity Calculation per year – This refers to the
Number of days’ pay given as gratuity for the entire slab. If the slab period
has not ended, then the slab is applied based on the number of months cov-
ered in the previous slab. If the number of days eligible is zero (0), then the
eligible days mentioned in the next slab are considered.
5. Specify the group as Provisions (Current Liabilities) in the field Under and press Enter

46
Creation of Payroll Masters

The completed Gratuity Expenses (Provisional) Pay Head Creation screen is displayed as
shown:

Figure 2.41 Gratuity Expenses Ledger Creation screen

6. Press Enter to Accept the screen.

Salary Details Setup

The Salary Details masters contain information on the Employee Group/ individual employee pay
structure, comprising of both earnings and deductions pay components for the applicable period.
Businesses having a common pay structure for a particular department or division or set of
employees can define salary details for an employee group and classify individual employees
under the specified group to inherit the parent pay values. The Employee Group master prefills
the parent group values to the individual employee masters created under them. It reduces the
possibility of erroneous data entry and expedites data entry. This categorisation also helps in gen-
eration of Group-wise reporting.
Pay structure constituting the Pay Heads and basis of calculation should be similar for the
employees falling under the same group, but pay values need not be the same.
Tally.ERP 9 also allows you to set up individual employee salary details with all parameters appli-
cable for Employee groups. The individual employee masters with separate pay structures are
usually created on a case-to-case basis.

47
Creation of Payroll Masters

To define Salary Details for employees,

Go to Gateway of Tally > Payroll Info. > Salary Details > Create

Figure 2.42 List of Employee Groups/ Employees screen

1. Select Vijay Kumar from the List of Employees and press Enter
In the Salary Details screen,
□ The Effective date is entered as 01-04-2009 by default based on the Date of Joining
entered in the Employee Master
□ Select Basic Pay as the Pay Head from the List of Pay Heads
□ Specify 10,000 as Rate
□ The Attendance units, Pay Head Type and Calculation Type appear by default, based
on the pay head definitions.

48
Creation of Payroll Masters

The Salary Details Creation screen is displayed as shown:

Figure 2.43 Salary Details Creation screen

2. Select House Rent Allowance as the second Pay Head and press Enter
3. Select Conveyance as the next Pay Head
4. Specify 800 as Rate and press Enter
5. Select Overtime Pay as the Pay Head
6. Specify 55 as the Rate and press Enter
7. Select Variable Pay as the Pay Head and press Enter
8. Select Professional Tax against the Pay Head and press Enter
9. Select Employee’s PF Contribution @ 12%, Employee’s ESI Contribution @ 1.75% as Pay
Head and press Enter
10. Select the Gratuity Expenses (Provisional) ledger and press Enter (In case of Employees
eligible for Gratuity, the Gratuity Expenses ledger should be included in the Salary details of
the respective Employee for provisional assessment of Gratuity)

49
Creation of Payroll Masters

The completed Salary Details Creation screen for Mr. Vijay Kumar is displayed as shown:

Figure 2.44 Completed Salary Details screen

Tally.ERP 9 allows you to modify the pre-defined Slab rates by pressing F12:
Configure and setting the option Allow to Override Slab Percentage to
Yes.

In case a revision in pay structure is required for any subsequent period,

define the latest pay structure by specifying the relevant Effective from date.

50
Creation of Payroll Masters

Similarly, create the pay structure for the other employees as per the details given in the following
table:
Pay Head Rahul Mahesh Ajay
Basic Pay 20,000 45,000 10,000
House Rent Allowance 40% 40% 20%
Conveyance — 1,000 2,000
Overtime Pay — — 100
Variable Pay User — defined
Gratuity Expenses (Provisional) Only for reporting purpose
Employee’s PF Contribution @ 12% Applicable as Slab Rates
Employee’s ESI Contribution @ 1.75% Applicable as Slab Rates
Professional Tax Applicable as Slab Rates

Salary Details for Ajay can be created similar to the Salary Details creation for Vijay Kumar.

Since Ajay and Mahesh are in Sales Group, we can create the Salary Details for the Group and
inherit the same for the Employees (Ajay and Mahesh) in that Group.

Salary Details creation for the Sales Group

Go to Gateway of Tally > Payroll Info. > Salary Details > Create
1. From the List of Group / Employees select Sales
2. Select the Pay Heads from the List of Pay Heads which are applicable to this group.
3. Leave the Rate field empty if there is no standard rate.

51
Creation of Payroll Masters

The completed Salary structure for the Sales Group is as shown:

Figure 2.45 Completed Salary Details for Sales Group

The Pay structure created above can be inherited for all the employees belonging to Sales Group.
This feature helps in eliminating the repetitions while creating the Salary Details.

To define the Salary Details for Mr. Ajay belonging to Sales Group, follow the steps given below:
Go to Gateway of Tally > Payroll Info. > Salary Details > Create
1. From the List of Group / Employees select Ajay and press Enter
2. Select Copy From parent Value from the Start Type options under Pay Head

52
Creation of Payroll Masters

The Salary Details Creation screen is displayed as shown:

Figure 2.46 Salary details Creation – Copy From Parent Value

Start Type Details:

Copy From Parent Value will copy the pay structure from the Group to
which the Employee belongs. This will help you to save time in creating the
Salary Details for large number of Employees.
Start Afresh will allow the user to start selecting the Pay Head from the List
of pay Heads already created.

3. The Pay Structure (comprising of Earning & Deductions pay heads) defined for the Group is
prefilled automatically.
4. Enter the values for each Pay Head for Ajay as per the details mentioned earlier.
5. Press F12: Configure
■ Set the option Allow to Override Slab Percentage to Yes, since the HRA calculation
percentage is 20%.

53
Creation of Payroll Masters

The Salary Details Configuration screen is displayed as shown:

Figure 2.47 Salary Details Configuration

■ Press Enter to Accept

6. Now, you will be able to enter the user-defined pay rates to compute the HRA, specify 20% and
press Enter

In the Salary Details Configuration screen, when the option Allow to

Override Slab Percentage is set to Yes, the predefined slab rates for the
Pay Heads can be modified as per user requirements.

54
Creation of Payroll Masters

The completed Salary Details screen of Mr. Ajay is displayed as shown:

Figure 2.48 Completed Salary Details screen

7. Press Enter to Accept the screen.

Similarly, you can create the Salary Details for Mahesh and others employees.

55
Lesson 3: Processing Payroll in Tally.ERP 9

Lesson Objectives
On completion of this lesson, you will have learnt

□ To process Payroll in Tally.ERP 9

Typically, Payroll Processing comprises of the following activities:

□ Recording of Attendance and Production details (on time / work)
□ Processing Payroll Vouchers
□ Payment of Salaries

There are three types of Payroll Vouchers namely Attendance Voucher, Payroll Voucher and
Payment Voucher, which are by default preset in Tally.ERP 9 to record above Payroll transac-
tions.

Payroll Vouchers are used for the purposes of operating your payroll and also records the attend-
ance of the employees for a given period. These vouchers are basically used to input information
pertaining to Payroll processing.
.
Attendance Vouchers
An Attendance Voucher is used to record employees’ attendance data, based on Attendance/
Production types (i.e., present or absent days, overtime hours and so on).

An Attendance Voucher allows you to record the attendance/ production units for employees.
Tally.ERP 9 gives you the flexibility to enter the attendance records through a single attendance
voucher for a payroll period, or through multiple attendance vouchers as and when required within
a payroll period. You also have the option of recording one attendance/ production voucher per
employee per day or collectively for a month or any other variation thereof for all the employees.
In Tally.ERP 9, the auto-fill facility (Alt+A) is used to prefill the required Attendance/Production
types data for the selected employee group/ employee for the specified period.

56
Processing Payroll in Tally.ERP 9

Example 1:
On 30th April, 2009 the attendance records of M/s. Spectrum Solutions displayed the
following details:
Attendance/ Produc- Vijay Kumar Rahul Mahesh Ajay
tion Types
Present Days 26 22 15 17
Overtime hours 900 Min 720 Min
(15hr x 60min) (12hr x 60min)
In the above scenario, separate attendance vouchers are required to be entered for recording
Present days and Overtime hours.

Go to Gateway of Tally > Payroll Vouchers

1. Press Ctrl+F5 for Attendance Voucher
The Attendance Voucher Creation screen is displayed as shown:

Figure 3.1 Attendance Voucher Creation screen

2. Press F2 and specify the date as 30-4-2009

3. Press Enter
4. Press Alt+A (Attendance Auto Fill) to prefill employee payroll details

57
Processing Payroll in Tally.ERP 9

The Attendance Auto Fill screen is displayed as shown:

Figure 3.2 Attendance Auto Fill screen

In the Attendance Auto Fill screen,

■ Specify the Voucher Date as 30-04-2009 if not specified earlier
■ Select Primary Cost Category as Employee Category (If separate cost categories
are used to capture employee cost, then select the respective Employee category)

Figure 3.3 Attendance Auto Fill - Employee Category selection

■ Select All Items as Employee/ Group (if you want to generate payroll voucher for indi-
vidual employee/ group, select the respective employee or group)

58
Processing Payroll in Tally.ERP 9

The Attendance Auto Fill with Employee Filters screen is displayed as shown:

Figure 3.4 Attendance Auto Fill with Employee List

■ Select Present as Attendance Type in the Attendance/ Production Type field

Figure 3.5 Attendance Auto Fill with List of Attendance Type

■ Specify the require value that should be prefilled for all Employees e.g. 26
■ Press Enter to accept the screen

59
Processing Payroll in Tally.ERP 9

Separate Attendance vouchers are required for recording attendance on

Work and Production.
If you opt for Absent as Attendance Type, then you need to record the
negative attendance of the employees. This minimises data entry time and
manages the data entry by exception.

5. Employees pertaining to the respective Employee Groups are displayed automatically

Figure 3.6 Attendance Voucher

6. Alter the attendance details as given in the table above

60
Processing Payroll in Tally.ERP 9

The Attendance Voucher Creation screen with the attendance details screen is displayed as
shown:

Figure 3.7 Attendance Voucher

7. Press Enter
8. Enter the details of the transaction in the Narration field

61
Processing Payroll in Tally.ERP 9

The completed Attendance Voucher Creation for Present Attendance is displayed as shown:

Figure 3.8 Completed Attendance Voucher Screen

9. Press Enter to accept the completed Attendance Voucher screen.

Days with Loss of Pay (LOP) are treated as a Deductible with respect to the
Earnings Pay Head type and as a Payable with respect to the Deductions
Pay Head type. For example, LOP is deducted from the Basic salary
(Earnings Pay Head) and Canteen expenses (Deductions Pay Head) are
treated as a payable.

In the same way, create an Attendance Voucher for Overtime Hours.

62
Processing Payroll in Tally.ERP 9

The completed Attendance Voucher for Overtime Hours is displayed as shown:

Figure 3.9 Attendance Voucher Screen - Overtime

□ Press Enter to accept.

You can also record Overtime in hours, provided the Unit of Measurement for
the Payroll unit is defined as Hrs.

After creating the Attendance Voucher, you can change any attendance value for a particular
employee, if required, in the Voucher Alteration mode.

63
Processing Payroll in Tally.ERP 9

Payroll Vouchers
A payroll voucher is used to record all employee-related transactions. It enables you to compute
all the values for the respective Pay Heads (Earnings and Deductions).

The calculations are made on the basis of the definitions specified in the pay head masters, pay
structure and attendance entries. In Tally.ERP 9, you can pass payroll vouchers manually for indi-
vidual employee as well as for the entire group/ organisation by using the Auto Fill facility (Alt+A).

In Tally.ERP 9, the disbursement of salaries can be effected in any of the following modes.
□ Direct Remittance – in cash or by cheque
□ Bank Transfer – a direct transfer is made to an employee’s bank account and the list of
disbursement is printed separately

Cash Remittance

Example 2:
On 30th April, 2009, M/s. Spectrum Solutions processes Payroll for all the employees and
entitled the following employees for Variable Pay.

Particulars Vijay Kumar Rahul Mahesh Ajay

Variable Pay 1500 - 1000 -

Go to Gateway of Tally > Payroll Vouchers

1. Press Ctrl+F4 for Payroll Voucher
2. Press F2, specify the date as 30-4-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
In the Payroll Auto Fill screen,
■ Select Salary in the Process for field

Figure 3.10 Payroll Autofill with Process List

64
Processing Payroll in Tally.ERP 9

In Tally.ERP 9, the following processes are preset for faster processing of

Payroll:
□ Salary: This process is used for processing salaries for a specified
period, wherein Salaries are disbursed through Cash or a bank transfer.
□ ESI Contribution: This process is used for processing Employer’s
contributions towards ESI for a specified period.
□ PF Contribution: This process is used for processing Employer’s Provi-
dent Fund (PF) contributions for a specified period.

■ Specify 1-4-2009 in the From field

■ Specify 30-4-2009 in the To field
■ Select All Items as Employee/Group

Figure 3.11 Payroll Autofill with List of Employees

■ Select Cash in the Payroll Ledger field

65
Processing Payroll in Tally.ERP 9

The completed Payroll Auto Fill screen is displayed as shown:

Figure 3.12 Payroll Autofill with payment Ledger list

■ Press Enter to accept the screen (the Cash ledger is prefilled in the Account field)

All the pay values are calculated for the applicable pay heads for each employee grouped under
the selected group.

66
Processing Payroll in Tally.ERP 9

The Payroll Voucher Creation screen is displayed as shown:

Figure 3.13 Payroll Voucher Creation

4. Press Enter and specify the pay values for the pay heads defined as user-definable values
against each employee (in this case, define the Variable Pay)

67
Processing Payroll in Tally.ERP 9

■ Specify 1000 as Variable Pay for Mahesh

Figure 3.14 Payroll Voucher - adding Variable pay

■ Similarly, specify 1500 as Variable Pay for Vijay Kumar and press Enter

68
Processing Payroll in Tally.ERP 9

The completed Payroll Voucher Creation screen is displayed as shown:

Figure 3.15 Completed Payroll Voucher

5. Press Enter to accept.

Press Alt+S to pass the above voucher in the Voucher mode. This can be
used to keep track of Bill References. e.g. if there are more than one Salary
Advances, then the to track the recovered Amount from Employee’s salary
against the respective Advance given, this feature should be used.

Bank Transfer
Bank transfer refers to disbursement of Salaries directly into the Employee Bank Accounts by inti-
mating the Bank through a Payment advice. Tally.ERP 9 facilitates processing salaries through
Bank transfer with the help of predefined Salary process.

Example 3:
On 31st May, 2009 M/s. Spectrum Solutions disbursed Salaries payable for the month of
May 2009 through Bank Transfer. The attendance records displayed the following details:

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Processing Payroll in Tally.ERP 9

Attendance/Production Vijay Kumar Rahul Mahesh Ajay

Types
Present Days 25 20 26 21
Overtime Hours - 120 Min
(2hr x 60min)

On 31st May 2009, M/s. Spectrum Solutions processes Payroll for all the employees and
entitled the following employees for Variable Pay.
Particulars Vijay Kumar Rahul Mahesh Ajay
Variable Pay 500 - 1200

Step 1: Create Attendance Voucher

Create Attendance Vouchers for Present days and Overtime hours for May 2009 as per the
details given in the above table.

The completed Attendance Voucher for Present days is displayed as shown:

Figure 3.16 Attendance Voucher for Present days

□ Press Enter to accept

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Processing Payroll in Tally.ERP 9

In the same way, create an Attendance Voucher for Overtime Hours.

The completed Attendance Voucher for Overtime Hours is displayed as shown:

Figure 3.17 Attendance Voucher for Overtime Hours

□ Press Enter to accept.

Step 2: Create Salary Payable Ledger

Before passing the Salary payment voucher, create the following ledger:
Ledger Pay Head Type Under
Salary Payable Not Applicable Current Liabilities

71
Processing Payroll in Tally.ERP 9

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
The completed Salary Payable Ledger creation screen is displayed as shown:

Figure 3.18 Salary Payable Ledger Creation

□ Press Enter to accept

Step 3: Create Payroll Voucher

Go to Gateway of Tally > Payroll Vouchers
1. Press Ctrl+F4 for Payroll Voucher
2. Press F2, specify the date as 31-05-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
4. In the Payroll Auto Fill screen,
■ Select Salary in the Process for field as shown

Figure 3.19 Payroll Autofill with List of Processes

5. Specify 01-05-2009 in the From field

6. Specify 31-05-2009 in the To field

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Processing Payroll in Tally.ERP 9

7. Select All Items as Employee/Group

8. Select Salary Payable in the Payroll Ledger field as shown

Figure 3.20 Payroll Autofill - Payroll Ledger selection

9. Press Enter (All the pay values are calculated for the applicable pay heads for each employee
grouped under the selected group).
10. Press Enter and specify the pay values for the pay heads defined as user-definable values
against each employee
■ Specify 1200 as Variable Pay for Ajay
■ Specify 500 as Variable Pay for Vijay Kumar
The completed Payroll Voucher for the month of May 2009 is displayed as shown:

Figure 3.21 Completed Payroll Voucher

11. Press Enter to accept

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Processing Payroll in Tally.ERP 9

After passing the above entry, the salaries payable for the month of May 2009 are transferred to
the Salary Payable Ledger, at the time of payment of salaries, the amount is reversed.

Payment of Salaries (Salary Disbursement)

In Tally.ERP 9, a Payment voucher can be used to effect salary disbursement to employees. The
payment voucher for the salaries payable may be passed through regular payment voucher or
automated using the preset Salary Payment process available in Tally.ERP 9 for error free data
input during Payroll Payment entry with the help of Auto Fill facility.

Example 4:
On 31st May 2009, M/s. Spectrum Solutions paid the salaries due for the month of May
2009.
Before passing the payment voucher, necessary Bank Accounts should be created. To make the
Salary payment, follow the steps given below:

Go to Gateway of Tally > Accounting Vouchers

1. Press F5 for Payment Voucher
2. Press F2, specify the date as 31-05-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
In the Payment Auto Fill screen,
■ Select Salary Payment in the Process for field as shown.

Figure 3.22 Payment Auto Fill - Payment Process Selection

■ Specify 01-05-2009 as From period

■ Specify 31-05-2009 as To period
■ Specify Voucher Date as 31-05-2009
■ Select Primary Cost Category in the Employee Category field
■ Select All Items in the Employee/Group field
■ Select HDFC Bank in the Bank / Cash Ledger field as shown.
■ Select Salary Payable in the Payroll Ledger field

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Processing Payroll in Tally.ERP 9

The completed Payment Auto Fill screen is displayed as shown:

Figure 3.23 Payment Auto Fill screen

4. Press Enter and the employee payroll details will appear by default.
5. Enter the details of the transactions in the Narration field

The completed Payroll Payment Entry screen is displayed as shown:

Figure 3.24 Payment Voucher

6. Press Enter to accept.

If a partial payment of salaries is made to a particular group of employees, then generate a

separate payroll voucher for their payables and pass a separate payment entry based on the set-
tlement. However, Tally.ERP 9 also allows you to modify the payment amount to the Employees.

75
Processing Payroll in Tally.ERP 9

The unpaid salary will remain as outstanding in the Salary payable account and can be auto-filled
in the payment voucher as and when the actual payments are made.

□ If any cash disbursements are made prior to the payment voucher entry,
after using the Auto-Fill facility, select the unpaid salaries and enter zero
(0) in the amount payable.
□ If salaries are disbursed by cheque, select individual employee in the
Auto Fill Employee Filter and print the cheque for the payment voucher.
You have to create separate payroll payment entries for each employee.

76
Lesson 4: Accounting for Employer PF
Contributions

Lesson Objectives
On completion of this lesson, you will be able to

□ Process Employer’s Contributions to Provident Fund (PF)

□ Payment of Provident Fund Contributions
□ Generate the PF Combined Challan

The Employees' Provident Funds and Miscellaneous Provisions Act is a social security legislation
which administers provident fund, family pension and insurance to employees. The Act covers
three schemes, namely; PF (Provident Fund scheme), EPS (Employees’ Pension Fund Scheme),
EDLI (Employees Deposit Linked Insurance scheme).

Under the Employees’ Provident Fund scheme, both the employees and employer contribute to
the fund at the rate of 12% of the basic wages, dearness allowance, cash value of food conces-
sion and retaining allowance (if any), payable to employees per month. The contribution rate is
10% in the case of the following establishments:
□ Any covered establishment with less than 20 employees
□ Any sick industrial company as specified in the relevant section of Sick Industrial Compa-
nies (Special Provisions) Act, 1985 and which has been declared as such by the Board for
Industrial and Financial Reconstruction
□ Any establishment which has at the end of any financial year accumulated losses equal to
or exceeding its entire net worth and
□ Any establishment engaged in manufacturing of (a) jute (b) Breed (d) coir and (e) Guar
gum Industries/ Factories.

The Contribution payable by the Employer is not to be deducted from the wages of the employee.
However, the employer has to deduct employee's share from their Salaries and pay the same in
EPF scheme. The deduction can be made only from the wages pertaining to a period for which
contribution is paid. However, if there is an accidental omission, the amount can be recovered
later.

77
Accounting for Employer PF Contributions

Out of the employer's contribution of 12% or 10%, the Employer's contribution of 8.33% is
diverted to Employees' Pension Scheme and the balance is retained in the EPF scheme. On
retirement, the employee gets his full share plus the balance of Employer's share retained to his
credit in the EPF account.

Once an establishment is covered under PF, all its departments and branches are covered, irre-
spective of where they are located.

i. Employees' Pension Scheme:

As discussed above, the employer's contribution of 8.33% is diverted to the fund of the Pension
Scheme and the balance 3.67% (1.67%, if the contribution is 10%) is credited in employee's
name in Provident Fund account. The contribution of 8.33% is on maximum salary of Rs. 6,500.
However, if some employers are paying contribution on salary in excess of Rs. 6,500, the excess
contribution will be credited to Provident Fund account and not to Pension scheme.

Benefits under the Scheme

Members will get pension on superannuation or retirement from service and upon disablement
during employment. Family pension will be available to the widow/widower for life or till he/she
remarries. In addition, children will be entitled to pension, upto 25 years of their age. In case of
orphans, pension at enhanced rate is available upon death of widow/widower or ceasing payment
of widow pension. Benefit of pension to children or orphan is restricted to two children/orphans. If
the person is unmarried or has no family, pension is available to the nominee for a specified
period.

ii. Employees Deposit Linked Insurance Scheme:

The purpose of the scheme is to provide life insurance benefits to employees who are already
covered under PF/EPS. The employer has to pay a contribution equal to 0.50% of the total wages
of the employee. Additionally, administrative charges of 0.01% of total wages have also to be paid
by the employer. The employee does not have to contribute any amount to this scheme. The
salary limit for coverage of employees is the same as that of the Provident Fund.

Benefit to nominee of employee

In case of death of an employee during employment, his nominee or family member gets an
amount equal to average balance in the Provident Fund Account of the deceased employee
during the last 12 months.

As discussed earlier, the statutory features viz., EPF & ESI etc., are required to be configured in
F11: Statutory & Taxation Features. In this section, we will discuss, recording of transactions
related to computation and contribution of Provident Fund.

78
Accounting for Employer PF Contributions

Illustration 1:
On 30th April, 2009 M/s. Spectrum Software Solutions processed Provident Fund contribu-
tions for the month of April 2009 and paid the amount in full to EPFO.

The same is accounted as shown:

In Tally.ERP 9, follow the steps given below to process Employer contribution towards Provident
Fund:
□ Create Employer PF Contribution Masters
□ Alter/Modify Salary Details
□ Processing Employer PF Contribution
□ Processing PF Admin Expenses
□ Payment of Provident Fund

Creation of Employer PF Contribution Masters

In Tally.ERP 9, Employer contribution towards Employees’ Pension Fund (Employees’ Pension
Scheme), Provident Fund, Admin Charges and other PF related ledgers are required to be
created separately for appropriate Accounting and reporting. Create the following ledgers in
Tally.ERP 9,
1. Employer Contributions Pay Head
2. Employer PF Admin Charges
3. PF Payable Ledger
4. Creation of PF Admin Expenses Ledger

I. Employer Contributions Pay Head

Pay Head Pay Head Type Statutory Pay Under Affect Calculation
Name Type Net Type
Salary
Employer EPS Employer’s Statu- EPS Account Indirect No As computed
@ 8.33% tory Contributions (A/c No.10) Expenses value
Employer EPF Employer’s Statu- PF Account (A/ Indirect No As computed
@ 3.67% tory Contributions c No.1) Expenses value

i. Employer Contribution EPS @ 8.33% Pay Head Creation

Go to Gateway of Tally > Payroll Info. > PayHeads > Create
In the Pay Heads Creation screen,
1. Type Employer EPS @ 8.33% as the Name of the Pay Head
2. Select Employer’s Statutory Contributions in the field Pay Head Type

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Accounting for Employer PF Contributions

3. In the field Statutory Pay Type, select EPS Account (A/c No. 10) as shown

Figure 4.1 Employer EPS @ 8.33% Pay Head Creation

4. Specify the Group as Indirect Expenses in the Under field and press Enter
5. Set Affect Net Salary to No
6. By default the Calculation Type is set to As Computed Value and Calculation Period as
Months
7. Select Normal Rounding as the Rounding Method and 1 as the rounding Limit and press
Enter
□ In the Computation Info section,
■ Select On Specified Formula in the Compute field
■ Press Enter, the Compute subscreen appears
■ In the Compute Sub screen,

80
Accounting for Employer PF Contributions

■ Select Basic Pay as the Add Pay Head function from the list of Pay Heads as shown.

Figure 4.2 Compute Subscreen

■ Select End of List

□ Specify 1-4-2009 as the Effective From date
□ Specify 6500 in the Amount Upto column
□ Select Percentage as the Slab Type from the List of Slabs and specify 8.33% in the
Value Basis field and press Enter
□ The From Amount is prefilled as 6500, press Enter to skip the Amount Upto field
□ Select Value as the Slab Type from the List of Slabs
□ Specify 541 in the Value Basis field and press Enter

81
Accounting for Employer PF Contributions

The completed Employer EPS @ 8.33% Pay Head Creation screen is displayed as shown:

Figure 4.3 Completed Employer EPS Pay Head Creation Screen

8. Press Enter to accept

ii. Employer Contribution EPF @ 3.67% Pay Head

Go to Gateway of Tally > Payroll Info > PayHeads > Create
In the Pay Heads Creation screen,
1. Type Employer EPF @ 3.67% as the Name of the Pay Head
2. Select Employer’s Statutory Contributions in the field Pay Head Type
3. In Statutory Pay Type filed select PF Account (A/c No. 1)

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Accounting for Employer PF Contributions

The Pay Head Creation screen is displayed as shown:

Figure 4.4 Employer EPF @ 3.67% Pay Head Creation

4. Specify the group as Indirect Expenses in the Under field and press Enter
5. Set Affect Net Salary to No
6. The Calculation Type is defaulted automatically as As Computed Value and Calculation
Period as Months
7. Select Normal Rounding as the Rounding Method and 1 as the rounding Limit and press
Enter
8. In the Computation Info section,
□ Select On Specified Formula in the Compute field
□ Press Enter and the Compute On subscreen displays
□ In the Compute sub-screen,
■ Select Employee’s PF Contribution @ 12% from the List of Pay Heads as the Add
Pay Head function and press Enter
■ Select Subtract Pay Head in Function and under Pay Head select Employer EPS @
8.33% from the List of Pay Heads.

83
Accounting for Employer PF Contributions

The Compute sub-screen is displayed as shown:

Figure 4.5 Compute Subscreen

■ Select End of List

□ Specify 1-4-2009 as the Effective From date
□ Press Enter to skip the Slab fields
□ Select Percentage as the Slab Type from the List of Slabs
□ Specify 100% in the Value Basis field and press Enter

84
Accounting for Employer PF Contributions

The completed Employer EPF @ 3.67% Pay Head Creation screen is displayed as shown:

Figure 4.6 Completed Employer EPF Pay Head Creation Screen

9. Press Enter to accept.

Alternatively, you can also define the criteria for computation of Employer PF
Contribution @ 3.67% Pay head, by selecting Basic Pay in the Compute sub-
screen. and defining the percentage as 3.67%.

II. Employer PF Admin Charges

Pay Head Pay Head Statutory Pay Under Affect Net Calculation
Name Type Type Salary Type
PF Admin Employer’s Other Admin Charges Current Lia- No As computed
Charges @ 1.10% Charges (A/c No.2) bilities value
EDLI Contribution Employer’s Other EDLI Contribution Current Lia- No As computed
@ 0.5% Charges (A/c No.21) bilities value
EDLI Admin Employer’s Other EDLI Admin Current Lia- No As computed
Charges @ 0.01% Charges Charges (A/c bilities value
No.22)

85
Accounting for Employer PF Contributions

i. PF Administrative Charges @ 1.10% Pay Head Creation

Go to Gateway of Tally > Payroll Info > PayHeads > Create
In the Pay Heads Creation screen,
1. Type PF Admin Charges @ 1.10% as the Name of the Pay Head
2. Select Employer’s Other Charges in the field Pay Head Type
3. In Statutory Pay Type field, select Admin Charges (A/c No. 2) as shown

Figure 4.7 PF Admin Charges Pay Head creation

4. Specify the group as Current Liabilities in the Under field and press Enter
5. Set Affect Net Salary to No
6. The Calculation Type is defaulted automatically as As Computed Value and Calculation
Period as Months
7. The Rounding Method is defaulted to Normal Rounding and 1 defaulted as the rounding
Limit
8. In the Computation Info section,
□ On PF Gross is selected automatically in the Compute field
□ Specify 1-4-2009 as the Effective From date
□ Specify 6500 in the Amount Upto column
□ Select Percentage as the Slab Type and specify 1.10% in the Value Basis field and press
Enter

86
Accounting for Employer PF Contributions

The completed PF Admin Charges @ 1.10% Pay Head Creation screen is displayed as shown:

Figure 4.8 Completed Pay Head Creation - PF Admin Charges

9. Press Enter to accept

ii. EDLI Contribution @ 0.5% Pay Head Creation

Go to Gateway of Tally > Payroll Info > PayHeads > Create
In the Pay Heads Creation screen:
1. Type EDLI Contribution @ 0.5% as the Name of the Pay Head
2. Select Employer’s Other Charges in the field Pay Head Type.

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Accounting for Employer PF Contributions

3. In Statutory Pay Type filed select EDLI Contribution (A/c No. 21) as shown

Figure 4.9 EDLI Contribution Pay Head Creation

4. Specify the group as Current Liabilities in the field Under and press Enter
5. Set Affect Net Salary to No
6. In the Computation Info screen,
□ In the Compute field, On PF Gross is selected by default.
□ Specify 1-4-2009 as the Effective From date (In case of a revision in pay structure, you
can define the revised computation information for the given pay head, by giving the effec-
tive from date)
□ The From Amount column is automatically skipped, assuming it to be zero. Enter 6500 in
the Amount Upto column.
□ Select Percentage as the Slab Type from the List of Slabs
□ Specify 0.5% in the Value Basis field and press Enter

88
Accounting for Employer PF Contributions

The completed EDLI Contribution @ 0.5% Pay Head Creation screen is displayed as shown:

Figure 4.10 Completed Pay Head for EDLI Contribution

7. Press Enter to accept and save the Pay Head

iii. EDLI Administrative Charges @ 0.01% Pay Head Creation

Go to Gateway of Tally > Payroll Info > PayHeads > Create
In the Pay Heads Creation screen,
1. Type EDLI Admin Charges @ 0.01% as the Name of the Pay Head
2. Select Employer’s Other Charges in the field Pay Head Type
3. In Stautory Pay Type filed select EDLI Admin Charges (A/c No. 22)

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Accounting for Employer PF Contributions

The Pay Head Creation screen is displayed as shown:

Figure 4.11 EDLI Admin Charges Pay Head Creation

■ Set Minimum Rs 2/Employee to Yes if you want the EDLI Admin Charges to be mini-
mum Rs. 2.

When the option Minimum Rs 2/Employee is set to Yes, the EDLI Admin
Charges for each employee is minimum Rs. 2 or actual value as calculated.

When this option is set to No the EDLI Admin Charges are calculated as per
the specified formula.

4. Specify the group as Current Liabilities in the field Under and press Enter
5. Set Affect Net Salary to No
6. In the Computation Info screen,
□ On PF Gross is selected in the Compute field, by default
□ Specify 1-4-2009 as the Effective From date
□ The From Amount column is automatically skipped, assuming it to be zero. Enter 6500 in
the Amount Upto column
□ Select Percentage as the Slab Type from the List of Slabs
□ Specify 0.01% in the Value Basis field and press Enter

90
Accounting for Employer PF Contributions

The completed EDLI Admin Charges @ 0.01% Pay Head Creation screen is displayed as
shown:

Figure 4.12 Completed pay Head for EDLI Admin Charges

7. Press Enter to accept and save the Pay Head.

III. PF Payable Ledger

To process the Employer PF Contribution, create PF Payable Ledger as explained below:
Ledger Pay Head Type Under
PF Payable Not Applicable Current Liabilities

Go to Gateway of Tally > Payroll Info. > Payheads > Create

1. Type PF Payable in the Name field
2. In the Pay Head Type field select Not Applicable
3. Specify the Group as Current Liabilities in the Under field and press Enter

91
Accounting for Employer PF Contributions

The completed PF Payable Ledger creation screen is displayed as shown:

Figure 4.13 Completed PF Payable Ledger Creation

4. Press Enter to accept.

IV. PF Admin Expenses Ledger

To process the Employer Other Charges (PF Admin, EDLI Contribution and EDLI Admin
expenses), create PF Admin Expenses Ledger as explained below:
Ledger Under
PF Admin Expenses Indirect Expenses

Go to Gateway of Tally > Accounts Info. > Ledgers > Create

1. In the Name field, type PF Admin Expenses
2. Specify the group as Indirect Expenses in the field Under and press Enter

92
Accounting for Employer PF Contributions

The completed PF Admin Expenses Ledger creation screen is displayed as shown:

Figure 4.14 PF Admin Expenses Ledger Creation

3. Press Enter to accept

Salary Details setup

Once the required Employer Contribution Pay Heads and Admin Expenses ledgers are created,
the salary details of the Employee should be altered to constitute the Employer Contribution pay
head ledgers for automatic calculations based on the monthly payments made to the Employees.

Create / Alter Salary Details Master

To update the salary details Master of the Employees, follow the steps given below:
Go to Gateway of Tally > Payroll Info. > Salary Details > Alter
1. Select the Vijay Kumar one by from the List of Groups / Employees
2. Add the Pay Heads Employer EPS @ 8.33% and Employer EPF @ 3.67%

93
Accounting for Employer PF Contributions

The completed Salary Details screen is displayed as shown:

Figure 4.15 Salary Details Alteration Screen

Similarly, include Employee Contribution Pay Heads in the Salary Details Masters of other
employees.
□ It is necessary to include Employer Contribution Pay Heads (i.e.,
Employer PF and Employer Pension Fund Pay Heads in the Salary
Structure of the Employee, to automate the Computation of Employer
PF Contribution on the basis of payments made to Employees.
□ While, including the Employer Contribution Pay Heads in the Salary
Details master, the order of precedence in which the Pay Heads are
included must on the basis of their calculation criteria i.e.,
i. Earning Pay Heads
ii. Deduction Pay Heads
iii. Professional Tax or Income Tax Pay Heads (if any)
iv. Employee PF Contribution Pay Heads
v. Employer PF Contribution Pay Heads
vi. Gratuity (Gratuity is calculated on Basic Pay + DA, hence Gratuity Pay
Head can be sequenced in the Salary details of an Employer in any
order after Earnings Pay Heads).

94
Accounting for Employer PF Contributions

Processing Employer PF Contribution

In Tally.ERP 9, you are required to process Employer PF Contributions, PF Admin Charges sepa-
rately and make the payment towards PF comprising of Employees’ PF Contribution, Employer
PF Admin Expenses through a combined challan.

Follow the steps explained below to process Provident Fund.

Go to Gateway of Tally > Payroll Vouchers
1. Press Ctrl+F4 for Payroll Voucher
2. Press F2, specify the date as 30-04-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to automate the employee payroll details
4. In the Payroll Auto Fill subscreen,
□ Select PF Contribution from the Process List drop down as shown

Figure 4.16 Payroll Auto Fill - Process List Selection

Tally.ERP 9 provides the following predefined processes that will help in process-
ing Payroll transactions:
i. ESI Contribution: This process is selected to automate computation
of Employer ESI Contribution.
ii. PF Contribution: This process is selected to automate computation
of Employer PF Contribution
iii. Salary: This process is selected to automate computation of Salaries
payable to Employees.

■ Specify 1-4-2009 and 30-4-2009 in the From and To Date fields respectively
■ Select Primary Cost Category in the Employee Category field
■ Select All Items as Employee/ Group field (To process, for a particular group /
Employee select the respective Employee / group, as required)

95
Accounting for Employer PF Contributions

■ Select PF Payable Ledger from the list of Ledger Accounts drop down in the Payroll
Ledger field as shown

Figure 4.17 Employee Filters screen – Payroll Ledger Selection

The values for the Employer PF contributions are prefilled in the Payroll Voucher for PF Contribu-
tion process.

96
Accounting for Employer PF Contributions

The Payroll Voucher for Employer PF Contribution is displayed as shown:

Figure 4.18 Payroll Voucher Creation - PF Contribution

5. Press Enter to accept

97
Accounting for Employer PF Contributions

The completed Payroll Voucher for Employer PF Contribution is displayed as shown:

Figure 4.19 Completed PF Contribution screen

6. Press Enter to accept.

Processing PF Admin Expenses

To process the PF Admin Charges, follow the steps given below:
Go to Gateway of Tally > Accounting Vouchers
1. Press F7 for Journal Voucher
2. Press F2, specify the date as 30-04-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to prefill Employer’s Other Charges details
■ Specify 1-4-2009 and 30-4-2009 in the From and To Date fields respectively
■ Select Primary Cost Category in the Employee Category field
■ Select All Items in the Employee/ Group field

98
Accounting for Employer PF Contributions

■ Select PF Admin Expenses Ledger in the Expense Ledger field

Figure 4.20 Employer’s Other Charges screen – Expenses Ledger Selection

99
Accounting for Employer PF Contributions

■ Select PF Admin Charges @ 1.10% Ledger in the Admin Charges (A/c No. 2) field
as shown

Figure 4.21 Employer’s Other Charges screen – Admin Charges Ledger Selection

■ Similarly, select EDLI Contribution @ 0.5% and EDLI Admin Charges @ 0.01% in
the EDLI Contribution (A/c No. 21) and EDLI Admin Charges (A/c No. 22) fields
respectively.

100
Accounting for Employer PF Contributions

The completed Employer’s Other Charges subscreen is displayed as shown:

Figure 4.22 Completed Employer’s Other Charges screen

■ Press Enter
4. Type the details of the transaction in the Narration field

101
Accounting for Employer PF Contributions

The completed Employer PF Expenses Voucher is displayed as shown:

Figure 4.23 Completed PF Expenses Voucher screen

5. Press Enter to accept and save.

Payment of Provident Fund

In Tally.ERP 9, once the process for Employee and Employer contributions to Provident Fund is
implemented in the manner as discussed in earlier sections, the total amount payable to EPFO is
accumulated separately in three Ledger Accounts, PF Payable Account (Employer Contributions),
Employee PF Contributions and the PF Admin Charges Ledger. At the time of making the
payment to EPFO, a payment voucher is required to be passed.

To process the payment of Provident Fund, follow the steps given below:

Step 1: Create PF Payment Voucher

Go to Gateway of Tally > Accounting Vouchers
1. Press F5 for Payment Voucher
2. Press F2, specify 30-04-2009 as the Voucher Date and press Enter
3. Press Alt+A (Payment Auto Fill) to prefill PF details

102
Accounting for Employer PF Contributions

■ Select PF Challan in the Process for field from the Process List screen

Figure 4.24 Employee Filters screen - Process Selection

■ Enter 1-4-2009 and 30-4-2009 in the From and To Date fields respectively
■ Specify 30-4-2009 in the Voucher Date field (This field is prefilled, if the voucher date is
specified during Voucher Entry)
■ Select Primary Cost Category in the Employee Category field
■ Select All Items in the Employee/ Group field
■ Select HDFC Bank in the Bank / Cash Ledger field
■ Select PF Payable Ledger in the Payroll Ledger field

Figure 4.25 Employee Filters screen - PF Ledger selection

4. Press Enter to prefill PF Payable Amount in respect of Employer Contributions during the
relevant month

103
Accounting for Employer PF Contributions

The Payment voucher is displayed as shown:

Figure 4.26 PF Payment Voucher with Employer PF Contribution details

104
Accounting for Employer PF Contributions

5. Press Enter again, to prefill the amount of Employee Contributions during the relevant
month

Figure 4.27 PF Payment Voucher - with Employee Contribution details

105
Accounting for Employer PF Contributions

6. Press Enter thrice again, to prefill EDLI Admin Expenses, EDLI Contribution and PF Admin
Charges during the selected month as shown:

Figure 4.28 PF Payment Voucher with Employer Other charges details

7. Press Enter twice

8. Set Yes in Provide Details field and press Enter
9. In the Provide Details subscreen,
■ Specify 245547 in the Cheque/ DD No. field
■ Specify 30-4-2009 in the Cheque/DD Date field
■ Specify 30-4-2009 in the Challan Date field
■ Type the name of the Depositor in the Depositor Name field
■ Specify the name of the Bank on which the Cheque is drawn in the Bank Name field
The completed Provide Details subscreen is displayed as shown:

Figure 4.29 Payment details subscreen

106
Accounting for Employer PF Contributions

10. Press Enter to go back to the PF Payment Voucher screen

11.Type the details of the transaction in the narration field
The completed PF Payment Voucher screen for the month of April 2009, is displayed as shown:

Figure 4.30 Completed PF Payment Voucher screen

12. Press Enter to accept

Step 2: Print PF Payment Challan
□ Press Pg UP from the Voucher Entry screen shown above
□ Press Alt + P, the Voucher Printing screen is displayed as shown:

Figure 4.31 Voucher Printing Screen

107
Accounting for Employer PF Contributions

□ In the Voucher printing screen, select Yes in the Print Challan field
□ Press Enter to Print
The printed PF Combined Challan for the month of April 2009 of M/s. Spectrum Software
Solutions is displayed as shown:

Figure 4.32 Printed PF Payment Challan

108
Lesson 5: Accounting for Employer ESI
Contributions

Lesson Objectives
On completion of this lesson, you will be able to

□ Process Employer’s Contribution to Employees’ State Insurance (ESI)

□ Payment of ESI Contributions
□ Generate the ESI payment Challan

ESI Contribution refers to the amount payable to the Corporation by the Principal Employer in
respect of Employees and comprises of the amount payable by the employee as well as the
employer.
The employer is required to calculate and remit ESI Contributions comprising of employers' share
and employees' share on or before the 21st of the subsequent month in respect of salaries of the
related month. The Principal Employer should pay the Employer’s share of contribution @ 4.75%
in respect of every employee whether employed directly or through an immediate employer. And
the Employee’s share @ 1.75% has to be recovered by making a deduction from their wages for
the respective salary/wages period.
In case, if the employee is drawing upto Rs. 70/- as daily average wage, he is exempt from
payment of his share of contribution. However, the employer has to pay employer’s share of
4.75% of the Salary payable to the employees.

109
Accounting for Employer ESI Contributions

Illustration 1:
On 1st June 2009, the list of new joinees with their Salary details are given below:
Employee Name Department Date of Joining
Suresh Administration 1-6-2009
Rajesh Sales 10-6-2009
The Salary details for the above new employees are listed in the table below:
Pay Head Suresh rajesh
Basic Pay 4,500 5000
House Rent Allowance 40% 40%
Conveyance 600 800
Overtime Pay — —
Variable Pay User — defined
Gratuity Expenses (Provisional) Only for reporting purpose
Employee’s PF Contribution @ 12% Applicable based on Slab Rates
Employee’s ESI Contribution @ 1.75% Applicable based on Slab Rates
Profession Tax Applicable based on Slab Rates

The Attendance details for the month of June 2009 are given as shown:
Attendance/ Production Vijay Rahul Mahesh Ajay Suresh Rajesh
Types Kumar
Present Days 26 21 20 22 23 21
Overtime hours 120 Min 600 Min
The Variable Pay details for the month of June 2009 are given as shown:
Particulars Vijay Rahul Mahesh Ajay Suresh Rajesh
Kumar
Variable Pay 0 0 0 0 0 0

The same is accounted as shown:

Create the above employees and their Salary details and then process the Salaries, PF Contribu-
tions for the month of June 2009, in the manner as discussed in the earlier chapters. In Tally.ERP
9, follow the steps given below to process Employer contribution towards Employees’ State Insur-
ance:
□ Create Employer ESI Contribution Masters
□ Alter/Modify Salary Details
□ Processing Employer ESI Contribution
□ Payment of ESI

110
Accounting for Employer ESI Contributions

Creation of Employer ESI Contribution Masters

In Tally.ERP 9, Employer and Employee’s contribution towards Employees’ State Insurance (ESI)
are required to be created separately for appropriate Accounting and reporting. Create the
following ledgers in Tally.ERP 9:
□ Employer Contribution Pay Head
□ ESI payable Ledger

I. Create Employer ESI Contribution @ 4.75% Pay Head

Pay Head Pay Head Type Statutory Pay Under Affect Calculation
Name Type Net Type
Salary
Employer ESI Employer’s Statu- Employee Indirect No As Com-
@ 4.75% tory Contributions State Insur- Expenses puted Value
ance

Go to Gateway of Tally >Payroll Info >Pay Heads >Create

In the Pay Heads Creation screen,
1. Type Employer ESI @ 4.75% as the Name of the Pay Head
2. Select Employer’s Statutory Contributions in the field Pay Head Type
3. Select Employee State Insurance in the Statutory Pay Type field from the Employer’s Stat-
utory Contributions drop down

Figure 5.1 Pay Head Creation - Employer ESI

4. Specify the group as Indirect Expenses in the Under field and press Enter

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Accounting for Employer ESI Contributions

5. Set Affect Net Salary to No and press Enter

6. In the Calculation Type and Calculation Period fields, As Computed Value and Months are
defaulted automatically based on the Statutory Pay Type selected.
7. Select Normal Rounding as the Rounding Method and 1 as the rounding Limit and press
Enter
8. In the Computation Info screen,
□ Select On Specified Formula in the Compute field and press Enter
□ In the Compute subscreen,
■ Select Basic Pay as the Add Pay Head function and press Enter
■ Select House Rent Allowance as the second Pay Head in the Add Pay Head Func-
tion
■ Similarly, select Conveyance and Overtime Pay in the Add Pay Head function
The Compute sub-screen is displayed as shown:

Figure 5.2 Employer ESI Pay Head Creation – Compute sub-screen

■ Select End of List and press Enter to accept the screen

Any Earning Pay component of a recurring nature will be subject to ESI calcu-
lation viz., Basic Pay, Dearness Allowance, House Rent Allowance, Convey-
ance, Overtime Pay and so on.
If you wish to consider a Pay Head (not regular in nature) for ESI Computa-
tion but don’t want to consider the same for ESI Eligibility, then set the
option Exclude for ESI Eligibility to Yes in the Pay Head alteration screen.
The option Exclude for ESI Eligibility will be available in the Pay Head
screen by setting the option Allow to Exclude Pay Head for ESI Eligibility
from the Pay Head Configurations.

112
Accounting for Employer ESI Contributions

□ Specify 1-4-2009 in the Effective From date field and press Enter, the From Amount col-
umn is automatically skipped, assuming the amount to be zero
□ The Amount Upto field is skipped and automatically defaulted with the amount specified in
the Payroll Statutory Details screen in F11: Satutory & Taxation
□ Select Percentage in the Slab Type field
□ Specify 4.75% as the Value Basis Percentage in the Value Basis field and press Enter

Figure 5.3 Employer ESI Pay Head Creation

In Tally.ERP 9, the Earning Payheads which are selected for computation of Employer ESI contri-
bution are listed in the Specified Formula for easy reference. You can alter / modify the criteria for
calculation, by pressing Enter in the Compute field and redefining the Function Pay components.
□ Specify 4.75% as the Value Basis Percentage in the Value Basis field and press Enter
□ Press Enter to accept

113
Accounting for Employer ESI Contributions

The completed Employer ESI Contribution Pay Head Creation screen is displayed as shown:

Figure 5.4 Completed Employer ESI Pay Head

□ Press Enter to accept.

II. Create ESI Payable Ledger

Create ESI Payable Ledger as explained below:
Ledger Pay Head Type Under
ESI Payable Not Applicable Current Liabilities

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
1. Type ESI Payable in the Name field
2. In the Pay Head Type field select Not Applicable
3. Specify the group as Current Liabilities in the Under field and press Enter

114
Accounting for Employer ESI Contributions

The completed ESI Payable Ledger creation screen is displayed as shown:

Figure 5.5 ESI Payable Ledger Creation

4. Press Enter to accept

Salary Details setup

Once the required Employer Contribution Pay Heads are created, the salary details of the
Employees should be updated to constitute the Employer Contribution pay head ledgers for
automatic calculations based on the monthly payments made to the Employees.

Create / Alter Salary Details Master

To update the salary details for the Employees, follow the steps given below:
Go to Gateway of Tally > Payroll Info. > Salary Details > Alter
1. Select Vijay Kumar from the List of Groups / Employees
2. Tab down to the last line and select Employer ESI @ 4.75% Pay Head from the List of Pay
Heads
3. Press Enter to select End of List

115
Accounting for Employer ESI Contributions

The completed Salary Details Alteration screen is displayed as shown:

Figure 5.6 Salary Details Alteration screen

4. Press Enter to Accept

□ It is necessary to include Employer ESI Contribution Pay Head in the
Salary Structure of the Employees, to automate the Computation of
Employer ESI Contribution on the basis of payments made to Employ-
ees.
□ While, including the Employer Contribution Pay Heads in the Salary
Details master, the order of precedence in which the Pay Heads are
included on the basis of their calculation criteria i.e.,
i. Earning Pay Heads
ii. Deduction Pay Heads
iii. Employee PF Contribution Ledgers
iv. Professional Tax or Income Tax Ledger (if any)
v. Employer PF Contribution Ledgers
vi. Employer ESI Contribution Ledgers
vii. Gratuity (Gratuity is calculated on Basic Pay + DA, hence Gratuity Pay
Head can be sequenced in the Salary details of an Employer in any
order).

Similarly, include Employer ESI @ 4.75% Pay Head in the Salary details of all other Employees.

116
Accounting for Employer ESI Contributions

Processing Employer ESI Contribution

In Tally.ERP 9, you can process Employer ESI Contributions and make the payment towards ESI
comprising of Employees’ and Employer’s ESI Contribution through a challan. To process the ESI
Contribution for June 2009, follow the steps given below:

Go to Gateway of Tally > Payroll Vouchers

1. Press Ctrl+F4 for Payroll Voucher
2. Press F2, specify the date as 30-06-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
4. In the Payroll Auto Fill subscreen,
□ Select ESI Contribution from the Process List as shown:

Figure 5.7 Payroll Autofill - ESI process selection

□ Specify 1-6-2009 and 30-6-2009 in the From and To Date fields respectively
□ Select Primary Cost Category as Employee Category field
□ Select All Items in the Employee/ Group field

117
Accounting for Employer ESI Contributions

□ Select ESI Payable Ledger in the Payroll Ledger field as shown:

Figure 5.8 Payroll Autofill – Payroll Ledger selection

5. Press Enter to accept and go back to the Payroll Voucher screen

118
Accounting for Employer ESI Contributions

The completed Employer ESI Contribution Voucher Creation screen is displayed as shown:

Figure 5.9 Completed ESI Voucher

6. Press Enter to accept

□ The Employer ESI contribution will be computed automatically upon

selection of ESI Contribution Process during Payroll Voucher Entry.
However, only for employees those who meet the criteria of monthly
earnings not exceeding the prescribed limits will be subject to ESI Con-
tribution.
□ In the same way while processing Salaries, the Employees ESI Contri-
bution will also be computed based on the Eligibility amount prescribed
in F11: Statutory & Taxation Features.

Payment of ESI
In Tally.ERP 9, once the process for Employee and Employer contributions to Employee’s state
Insurance is implemented in the manner as discussed in earlier sections, the total amount
payable to ESIC comprising of Employee’s Contribution as well as Employer’s contribution to ESI
is accumulated separately in the ESI Payable Ledger. At the time of making the payment to ESIC,
a payment voucher is required to be passed.

119
Accounting for Employer ESI Contributions

To process the payment of ESI and generate ESI Challan, follow the steps given below:

Step 1: Create ESI Payment Voucher

Go to Gateway of Tally > Accounting Vouchers
1. Press F5 for Payment Voucher
2. Press F2, specify the date as 30-06-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
4. In the Payment Auto Fill subscreen,
□ Select ESI Challan from the Process List as shown:

Figure 5.10 Employee Filters subscreen - ESI Process Selection

□ Specify 1-6-2009 and 30-6-2009 in the From and To Date fields respectively
□ Specify 30-6-2009 in the Voucher Date field (This field is prefilled, if the voucher date is
specified during Voucher Entry)
□ Select Primary Cost Category in the Employee Category field
□ Select All Items in the Employee/ Group field

120
Accounting for Employer ESI Contributions

□ Select HDFC Bank in the Bank / Cash Ledger field

Figure 5.11 Employee Filters Subscreen – Bank Ledger Selection

121
Accounting for Employer ESI Contributions

□ Select ESI Payable Ledger in the Payroll Ledger field

Figure 5.12 Employee Filters Subscreen - Payroll Ledger Selection

5. Press Enter to accept and go back to the Payment Voucher screen

122
Accounting for Employer ESI Contributions

6. Press Enter to prefill the Employer’s ESI Contribution amount for the eligible Employees

Figure 5.13 ESI Payment Voucher with Employer Contributions

123
Accounting for Employer ESI Contributions

7. Press Enter again, to prefill the Employee’s ESI Contribution amount against the eligible
Employees

Figure 5.14 ESI Payment Voucher with both Employee and Employer Contributions

8. Press Enter twice

9. Set Yes in the Provide Details field and press Enter
10. In the Provide Details subscreen, specify the Cheque / DD No., Cheque / DD Date and Bank
& Branch Code Details as shown:

Figure 5.15 Complete Provide Details subscreen

11. Press Enter to accept

12. Type the details of the transaction in the narration field

124
Accounting for Employer ESI Contributions

The completed ESI Payment Voucher for the month of June 2009 is displayed as shown:

Figure 5.16 Completed ESI Payment Voucher

13. Press Enter to accept

125
Accounting for Employer ESI Contributions

Step 2: Print ESI Payment Challan

□ Press Pg UP from the above Voucher Entry screen
□ Press Alt + P, the Voucher Printing screen is displayed as shown:

Figure 5.17 ESI Voucher Printing Screen

□ In the Voucher printing screen, select Yes in the Print Challan field
□ Press Enter to Print

126
Accounting for Employer ESI Contributions

The printed ESI Payment Challan for the month of June 2009 of M/s. Spectrum Software
Solutions is as shown:

Figure 5.18 Printed ESI Payment Challan

127
Lesson 6: Payment of Professional Tax

Lesson Objectives
On completion of this lesson, you will be able to:

□ Process payment of Professional Tax

6.1 Processing of Professional Tax Payment

Professional Tax is applicable to those individuals or professionals in India who are involved in
any profession or trade. The state government of each state governs and administers the levy and
collection of Professional Tax in the respective State.The state is empowered with the
responsibility of structuring as well as formulating the professional tax criteria for the respective
state. Professional tax is charged on the income of Individuals, profits of business or gains in
vocations as per the list II of the Indian Constitution.
In India, Professional Tax slabs vary from state to state and some of the states have formulated
different professional tax slabs for men, women and senior citizens. The rates depend upon
profession, years in the profession and the amount of income or turnover and so on. In Karnataka,
the professional taxes leviable are as follows:
S.No Salary or wage earners whose salary or wage or Tax Amount
both, as the case may be, for a month is,
(a) Less than Rs.5000 Rs. 0 Per month
(b) Not less than Rs. 5,000 but less than Rs.8,000 Rs. 60 Per month
(c) Not less than Rs.8,000 but less than Rs.10,000 Rs.100 Per month
(d) Not less than Rs.10,000 but less than Rs.15,000 Rs.150 Per month
(e) Rs. 15,000 and above Rs.200 Per month

128
Payment of Professional Tax

The creation of Professional Tax Pay Head is discussed in detail in the Creation of Masters
chapter and the procedure to process Professional Tax Deduction from Employee Salaries is
discussed in detail in Processing Payroll in Tally.ERP 9 Chapter. In this section, we will discuss
the recording of transactions related to payment of Professional Tax.

Illustration 1:
On 30th April, 2009 M/s. Spectrum Software Solutions made a payment of Professional Tax
for the month of April 2009.
The same is accounted as shown:
Create Payment Voucher
Go to Gateway of Tally > Accounting Vouchers
1. Press F5 for Payment Voucher
2. Press F2, specify the date as 30-04-2009 and press Enter
3. Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
4. In Employee Filters screen,
■ Select Professional Tax Payment from the Process List
■ Specify 1-4-2009 and 30-4-2009 in the From and To date fields respectively
■ Specify 30-4-2009 in the Voucher Date field (This field is prefilled, if the voucher date is
specified during Voucher Entry)
■ Select Primary Cost Category in the Employee Category field
■ Select All Items in the Employee/ Group field

129
Payment of Professional Tax

■ Select HDFC Bank in the Bank / Cash Ledger field

Figure 6.1 Employee Filters screen - Payment Ledger Selection

■ Select Professional Tax in the Payroll Ledger field

130
Payment of Professional Tax

The completed Employee Filters screen will is displayed as shown:

Figure 6.2 Completed Employee Filters screen

■ Press Enter to accept the screen and go back to the Payment Voucher screen
■ Press Enter to prefill the Professional Tax amount in the Payment Voucher

131
Payment of Professional Tax

The completed Professional Tax Payment Voucher is displayed as shown:

Figure 6.3 Completed Professional Tax Payment Voucher

5. Press Enter to Accept.

Similarly, process the Professional Tax payments for other months.

□ The creation of Professional Tax Pay Head is discussed in detail in Cre-

ation of Masters chapter.
□ The procedure to process Professional Tax Deduction from Employee
Salaries is discussed in detail in the chapter Processing Payroll in
Tally.ERP 9.

132
Lesson 7: Tracking of Salary Advances / Loans

Lesson Objectives
On completion of this lesson, you will be able to:

□ Track Salary Advances / Loans and recoveries in Tally.ERP 9

Tally.ERP 9 helps you track Salary Advance / loans given to employees and provides the flexibility
to specify simple to complex criteria for Recovery of Salary Advances or loans viz., Flat or manual
deduction and provision of lumpsum loan recovery and so on. Tally.ERP 9 also allows you to
generate a Month wise break-up report for the amount of loan disbursed, recovery of instalments
made and balance amount of Loan / Salary advance. Further, you can also use the Interest Cal-
culation feature of Tally.ERP 9 to compute interest on loans to employee etc.

In Tally.ERP 9, tracking of Salary Advances / Loans paid to employees follow the steps given
below:
□ Creation of Masters
□ Modify / Alter Salary Details
□ Payment of Salary Advance
□ Recovery of Salary Advance

Creation of Masters
Tally.ERP 9 allows you to create different ledgers for different types of Loans / Salary Advances.
Create the following ledger:
Ledger Pay Head Type Under
Staff Salary Advance Loans and Advances Loans and Advances (Asset)

133
Tracking of Salary Advances / Loans

I. Create Salary Advance Ledger

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
1. Type Staff Salary Advance in the Name field
2. Select Loans and Advances in the Pay Head Type field
3. Specify the group as Loans and Advances (Asset) in the Under field and press Enter
4. Set Affect Net Salary to Yes
5. Type Staff Salary Advance in Name to Appear in Salary Slip field
6. Select User Defined Value in the Calculation Type field

The completed Staff Salary Advance Ledger creation screen is displayed as shown:

Figure 1.1 Salary Advance Ledger

7. Press Enter to accept.

The Calculation Type can be taken as Flat Rate if you wish to deduct the
Loan Amount in Flat installments (EMI’s). In this case the Pay Head should
be removed from the Pay Structure after the entire amount is recovered from
the Employee’s salary.

134
Tracking of Salary Advances / Loans

Modify / Alter Salary Details

In order to deduct installments or for lumpsum recovery of Salary Advance from the monthly
salaries of the employees, it is essential to include Salary Advance / Loans ledgers in the Salary
Details master of the employees. Follow the steps given to update the Salary Details masters of
the Employees:

Go to Gateway of Tally > Payroll Info. > Salary Details > Alter
1. Select Vijay Kumar from the List of Groups / Employees and press Enter, the Salary
Details Alteration screen appears
2. In the Salary Details Alteration screen,
3. Tab down to the last line and select Staff Salary Advance ledger in the Pay Head field
4. Select End of List and press Enter

The completed Salary Details screen is displayed as shown:

Figure 1.2 Completed Salary details alteration screen

5. Press Enter to accept.

135
Tracking of Salary Advances / Loans

Payment of Salary Advance

In Tally.ERP 9, you may disburse the Salary advance / Loans to Employees using a Payment
Voucher as shown:

Illustration 1:
On 2nd July, 2009 M/s. Spectrum Software Solutions paid Salary Advance to the following
Employees with the mode and amount of recovery.

Employee Name Salary Advance Mode of Recovery Amount

(Rs.) Recovery (Rs.) per month
Rahul 10,000 Monthly Salary 5,000
Rajesh 3,000 Monthly Salary 1,500

The same is accounted as shown:

i. Create Payment Voucher

Setup:
□ Press F12: Configure and set Use Single Entry mode for Pymt/Rcpt/Contra to No

Go to Gateway of Tally > Accounting Vouchers > Payment Voucher (F5)

1. Press F2 to change the date to 2-07-09

136
Tracking of Salary Advances / Loans

2. In the Dr field, select Staff Salary Advance ledger from the list of ledgers

Figure 1.3 Payment Voucher - Salary Advance Ledger selection

3. Specify 13000 in the Dr Amount field and press Enter, the Cost Allocations for subscreen
appears
4. In the Cost Allocations for subscreen,
□ Select Primary Cost category in the Employee Category field
□ Select the required Employee (Rahul) from the list of Cost Centres and press Enter

137
Tracking of Salary Advances / Loans

The Cost Centre Allocations screen is displayed as shown:

Figure 1.4 Payment Voucher – Cost Centre Allocation screen

□ Specify 10000 in the Amount field

□ Similarly, select other Employee (Rajesh) from the List of Cost Centres and specify the
amount (i.e., 3,000)

138
Tracking of Salary Advances / Loans

The Completed Cost Allocation for subscreen is displayed as shown:

Figure 1.5 Cost Centre Allocation – Sub-screen

□ Press Enter to accept and go back to the Payment Voucher

5. Select HDFC Bank in the Cr field and press Enter
6. Press Enter to accept the Amount
7. Type the details of the transaction in the narration field

139
Tracking of Salary Advances / Loans

The completed Payment Voucher for Salary Advance is displayed as shown:

Figure 1.6 Completed Payment Voucher

8. Press Enter to accept.

Recovery of Salary Advance

In Tally.ERP 9, you may deduct or recover Salary Advance / Loans from Employees in Install-
ments by defining the criteria for deduction while creating the Salary Advance Pay Head; i.e., Flat
rate or manual deduction by specifying a user-definable amount. To recover salary advance /
loan, follow the steps given below:
Process the Attendance Vouchers for the month of July 2009 in the manner discussed in earlier
chapters, based on the following details:

Attendance records for July 2009:

Attendance/ Pro- Vijay Rahul Mahesh Ajay Suresh Rajesh
duction Types Kumar
Present Days 26 24 22 25 21 20

140
Tracking of Salary Advances / Loans

ii. Create Payroll Voucher

Go to Gateway of Tally > Payroll Vouchers
□ Press Ctrl+F4 for Payroll Voucher
□ Press F2, specify the date as 31-7-2009 and press Enter
□ Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
■ In the Employee Filters screen,
■ Select Salary in the Process for field
■ Specify 1-7-2009 in the From field
■ Specify 31-7-2009 in the To field
■ Select All Items as Employee/Group
■ Select Salary Payable in the Payroll Ledger field
□ Press Enter to accept the screen and go back to Payroll Voucher

The Payroll Voucher Creation screen is displayed as shown:

□ Tab down to Staff Salary Advance ledger field of Rahul and specify 5000 as the amount
to be deducted

Figure 1.7 Payroll Voucher - Salary Advance Recovery Entry

□ Similarly, tab down to Staff Salary Advance ledger field of Rajesh and specify 1500 as
the amount to be deducted

141
Tracking of Salary Advances / Loans

□ Similarly, enter the 1500 in Staff Salary Advance for Rajesh

The completed Payroll Voucher for July 2009 is displayed as shown:

Figure 1.8 Completed Payroll Voucher

□ Press Enter to accept.

If there are multiple Loans given to the Employees and if you wish to keep a
track of recovered loan amount against the Loan given, then you need to
pass a separate payroll voucher in ‘As Voucher’ format, as the bill-wise
details screen won’t appear in the ‘As Pay Slip’ format.

142
Lesson 8: Accounting for Pay Revision &
Arrears

Lesson Objectives
On completion of this lesson, you will be able to:

□ Record Pay Revisions and Arrears in Tally.ERP 9

Tally.ERP 9 provides a facility to process Arrears / Increments for a current Period as well as for a
prior period. It allows you to compute Arrears for a retrospective period, by defining the effective
date of such revisions or increments. Consider the following scenarios to understand the steps
involved in processing Salary revisions / Arrears calculation in Tally.ERP 9.
□ Salary Revision / Arrear Calculation for Prior Period
□ Salary Revision / Arrear Calculation for Current Period

Salary Revision / Arrear Calculation for Prior Period

Tally.ERP 9 allows you to record Arrear calculation voucher for all the eligible months separately
or together with the current month payroll voucher. For instance, in the below Illustration, for the
months from May 2009 to July 2009, the Payroll vouchers have been already processed and only
the arrear calculation needs to entered. In such cases, the Arrear calculation vouchers can be
passed on the last day of each applicable month separately or a single voucher can be passed
i.e., arrear calculation voucher for all preceeding months (from May 2009 to July 2009) plus
current month salaries, by defining the complete pay period i.e., 01-05-2009 to 31-08-2009.

Illustration 1:
On 5th August, 2009 M/s. Spectrum Software Solutions revised the Salaries for the
following Employees. Such a revision is effective from 1st May 2009.

143
Accounting for Pay Revision & Arrears

The revised Salary structure is as follows:

Employee / Pay Components Basic HRA Conveyance Variable Pay
Mahesh 50000 40% 2000 User-defined

Before processing the Payroll voucher for Salary revisions, it is essential to update the Salary
Details of the Employee, so as to take into consideration the declared Salary Revision / arrear
payment for/from the relevant period.

Step 1: Modify / Alter Salary Details

Go to Gateway of Tally > Payroll Info. > Salary Details > Alter
□ Select Mahesh from the List of Groups / Employees
□ Tab down to End of List, by pressing Enter
□ Specify 01-05-2009 in the Effective From field and press Enter
□ Select Copy From Previous Value from the Start Type drop down list

Figure 8.1 Salary Details Alteration Screen

144
Accounting for Pay Revision & Arrears

Start Type Options:

Copy From Parent Value: This option is selected, when the pay structure
details of the Parent group (to which Employee Group, the employee is
grouped under or falls) is required to be prefilled in the Salary details master.
Copy From Previous Value - This option is selected, when the pay structure
details of the Employee for a preceeding period is required to be prefilled for a
future period, in the Salary details master.
Start Afresh: This option is selected, when the pay structure details of the
Employee has to be created newly.

□ Press Enter to prefill the pay structure (comprising of Earning & Deduction Pay Heads) of
the preceeding period for the specified period
□ Press Enter on Basic Pay Pay Head and alter the amount to 50000
□ Tab down to Conveyance Pay Head and alter the amount to 2000
□ Press Enter to go to the End of List
The completed Salary Details screen is displayed as shown:

Figure 8.2 Completed Salary revision screen

□ Press Enter to accept

145
Accounting for Pay Revision & Arrears

Step 2: Arrear Calculation Voucher

Go to Gateway of Tally > Payroll Vouchers
□ Press Ctrl+F4 for Payroll Voucher
□ Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
□ In the Payroll Auto Fill subscreen
■ Select Salary in the Process for field
■ Specify 1-5-2009 and 31-7-2009 in the From and To fields respectively
■ Select Mahesh as Employee/Group
■ Select Salary Payable in the Payroll Ledger field

The completed Auto Fill subscreen is displayed as shown:

Figure 8.3 Payroll Auto Fill subscreen

■ Press Enter to automatically prefill the salary arrear amounts for the selected period

146
Accounting for Pay Revision & Arrears

The completed Payroll Voucher for Arrear calculation is displayed as shown:

Figure 8.4 Payroll Voucher – Arrear calculation

□ Press Enter to Accept

Step 3: Payment of Arrears

Go to Gateway of Tally > Accounting Vouchers
□ Press F5 for Payment Voucher
□ Press F2, specify the date as 05-08-2009 and press Enter
□ Press Alt+A (Payroll Auto Fill) to prefill payroll payment details
□ In the Payroll Auto Fill subscreen,
■ Select Salary Payment in the Process for field
■ Specify 1-5-2009 and 31-7-2009 in the From and To fields respectively
■ Specify 05-08-2009 as Voucher Date
■ Select Primary Cost Category under Employee Category
■ Select Mahesh in Employee/Group field
■ Select HDFC Bank in the Bank / Cash Ledger
■ Select Salary Payable in the Payroll Ledger field
■ Press Enter to accept the screen
□ Press Enter to prefill the salary arrears amount for the selected period

147
Accounting for Pay Revision & Arrears

The completed Salary Arrears Payment voucher of Mahesh for the period from May 2009 to July
2009 is displayed as shown:

Figure 8.5 Salary Arrears Payment Voucher

□ Press Enter to Accept.

The Salary Arrears / Increments may result in increase in Earning Pay com-
ponents which in turn may result in an increase in the tax liability i.e., an
increase in Basic Pay will result in an increase in HRA and such additional
income will be liable to Income Tax or Payroll taxes viz., PF, ESI and PT. The
procedure to make payments of PF, ESI or PT has been discussed in the
previous chapters.

148
Accounting for Pay Revision & Arrears

Salary Revision / Arrear Calculation for current Period

Illustration 2:
On 15th August 2009, M/s. Spectrum Software Solutions revised the Salaries for the
following Employees. Such revision is effective from the current month i.e., August 2009.

The revised Salary structure is as follows:

Employee / Pay Components Basic HRA Conveyance Variable Pay
Ajay 11000 30% 2000 User-defined

The Attendance records for August 2009 is as follows:

Attendance/ Production Vijay Kumar Rahul Mahesh Ajay Suresh Rajesh
Types
Present Days 26 22 25 26 26 26

Before processing the Payroll voucher for Salary revisions, it is essential to update the Salary
Details of the Employee to take effect the declared Salary Revision / arrear payment for/from the
relevant period.

Step 1: Modify / Alter Salary Details

Go to Gateway of Tally > Payroll Info. > Salary Details > Alter
□ Select Ajay from the List of Groups / Employees
□ Tab down to End of List, by pressing Enter
□ Specify 01-08-2009 in the Effective From field and press Enter
□ Select Copy From Previous Value from the Start Type drop down list

149
Accounting for Pay Revision & Arrears

The Salary Details Alteration screen is displayed as shown:

Figure 8.6 Salary Details Alteration screen

StartType Options
□ Copy From Parent Value: This option is selected, when the pay struc-
ture details of the Parent group (to which Employee Group, the
employee is grouped under or falls) is required to be prefilled in the Sal-
ary details master.
□ Copy From Previous Value - This option is selected, when the pay
structure details of the Employee for a preceeding period is required to
be prefilled for a future period, in the Salary details master.
□ Start Afresh: This option is selected, when the pay structure details of
the Employee has to be created newly.

□ Press Enter to prefill the pay structure (comprising of Earning & Deduction Pay Heads) of
the preceeding period for the specified period
□ Press Enter on Basic Pay Pay Head and alter the amount to 11000
□ Press Enter on HRA Pay Head and alter the percentage to 30% (To alter the percentage,
ensure in F12: Configure, Allow to Override Slab Percentage is set to Yes)
□ Tab down to Conveyance Pay Head and alter the amount to 2000

150
Accounting for Pay Revision & Arrears

□ Press Enter to go to the End of List

The completed Salary Details screen is displayed as shown:

Figure 8.7 Completed Salary Alteration screen

□ Press Enter to Accept

Step 2: Record Attendance

Record Attendance voucher in the manner as explained in previous chapters.

151
Accounting for Pay Revision & Arrears

The completed Attendance Voucher for August 2009 is displayed as shown:

Figure 8.8 Completed Attendance Voucher

Step 3: Process Payroll Voucher

Effective August 2009, the revised salary for Ajay will be computed automatically, while process-
ing Payroll voucher for the month of August along with the other employees or you may also
choose to process Ajay’s Payroll voucher separately, if required.

Go to Gateway of Tally > Payroll Vouchers

□ Press Ctrl+F4 for Payroll Voucher
□ Press Alt+A (Payroll Auto Fill) to prefill employee payroll details
□ In the Payroll Auto Fill subscreen
■ Select Salary in the Process for field
■ Specify 1-8-2009 and 31-8-2009 in the From and To fields respectively
■ Select Ajay in the Employee/Group field
■ Select Salary Payable in the Payroll Ledger field
■ Press Enter to accept the screen
□ Press Enter to prefill the salary amount (inclusive of increment amount) for the current
period

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Accounting for Pay Revision & Arrears

The completed Payroll Voucher for August 2009 is displayed as shown:

Figure 8.9 Completed Payroll Voucher

You may process Employer and Employee’s contribution to Provident Fund and Employee’s State
Insurance and payment of Profession Tax in the manner as discussed in the earlier chapters.

153
Lesson 9: Processing Payroll for Contract
Employees

Lesson Objectives
On completion of this lesson, you will be able to:

□ Process Salaries for Contract Employees

Tally.ERP 9 provides a simplified process for tracking and processing salaries for casual and
contract workers and helps in the generation of contract related reports. Tally.ERP 9 allows you to
process salaries for contractual employees for their services rendered during the agreed tenure.
You may compute salaries on hourly or production basis as agreed upon, by defining the required
criteria for the Pay components.

In this Chapter, we will discuss the recording of transactions related to computation of salaries for
Contractual employees.

Illustration 1:
On 5th August 2009, M/s. Spectrum Software Solutions hired two persons on contract.

The list of employees along with the contract details is as follows:

S. No. Name of Employee Department / Group Tenure Start Date End Date
1 James Contract Employees 6 Months 5 Aug 09 5 Feb 10
2 Vineet Contract Employees 9 Months 5 Aug 09 5 May 10

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Processing Payroll for Contract Employees

The Salary details for the above contract employees is as shown:

Employee / Pay Heads Basic Wages Overtime Local Conveyance
James 2000 50 / hr On Actuals
Vineet 2500 50 / hr On Actuals

The same is accounted for as shown:

In Tally.ERP 9, execute the following steps to process Salaries for Contract Employees:
□ Create Employee Masters
□ Create Pay Heads
□ Record Attendance details
□ Create Salary Details
□ Process Payroll

Create Employee Masters

As discussed in the earlier chapters, you need to create the following Employee Masters to:
1. Employee Group
2. Employees

I. Create Employee Group Master

Create a new Group Contract Employees by executing the following steps:
Go to Gateway of Tally > Payroll Info. > Employee Groups > Create
□ Select Primary Cost Category from the List of Categories in the Category field
□ Type Contract Employees in the Name field
□ Select Primary in the Under field and press Enter
The completed Employee Group Creation screen is displayed as shown:

Figure 9.1 Completed Employee Group Creation

□ Press Enter to Accept

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Processing Payroll for Contract Employees

II. Create Employee Master

Go to Gateway of Tally > Payroll Info. > Employees > Create
□ Select Primary Cost Category from the List of Categories in the Category field
□ Type the Name of the Employee in the Name field
□ Select Contract Employees in the Under field
□ Type the Date of Joining as 05-08-2009
□ Enter the other Employee Information.
The completed Employee Creation screen is displayed as shown:

Figure 9.2 Employee Creation screen

Similarly, create other Employee Masters i.e., Vineet.

Create Pay Heads

Create the following Pay Heads:
Pay Head Pay Head Type Under Affect Net Calculation Calcula-
Salary Type tion Period
Basic Wages Earnings for Indirect Yes on Attendance Months
Employees Expenses
Overtime Earnings for Indirect Yes on Production Months
Employees Expenses
Local Con- Reimbursements Indirect Yes As User -
veyance to Employees Expenses Defined Value

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Processing Payroll for Contract Employees

i. Create Basic Wages Pay Head

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
The completed Basic Wages Pay Head creation screen is displayed as shown:

Figure 9.3 Pay Head Creation – Basic Wages

□ Press Enter to Accept.

Similarly, create Overtime Pay Head with On Production as the Attendance Type.

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Processing Payroll for Contract Employees

ii. Create Local Conveyance Pay Head

The completed Local Conveyance Pay Head Creation screen is displayed as shown:

Figure 9.4 Pay Head Creation – Local Conveyance

□ Press Enter to Accept.

iii. Salary Details setup

Create the salary details for the above contract employees as discussed in the earlier chapters.

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Processing Payroll for Contract Employees

The completed Salary Details creation screen for James is displayed as shown.

Figure 9.5 Salary Details creation screen

□ Press Enter to Accept.

Similarly, create the Salary Details for Vineet.

Record Attendance details

The Attendance and Overtime Details for Contract Employees for August 2009 is as shown.
Attendance/Production Type James Vineet
Absent 1 2
Overtime 15 Hrs 17 Hrs

Step 1: Create Attendance Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F5 for Attendance Vouchers

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Processing Payroll for Contract Employees

The completed Attendance Voucher for the Contract Employees is displayed as shown:

Figure 9.6 Completed Attendance Voucher

□ Press Enter to Accept

Step 2: Create Production Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F5 for Attendance Vouchers

160
Processing Payroll for Contract Employees

The Production Voucher for Overtime hours is displayed as shown:

Figure 9.7 Completed Production Voucher

□ Press Enter to Accept.

Process Payroll
On 31st August 2009, M/s. Spectrum Software Solutions processed salaries for the
contract employees through Cash. The Local Conveyance for August 2009 is as follows:

Reimbursements Particulars James Vineet

Local Conveyance 1250 1225

The same is accounted as shown:

Create Payroll Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F4 for Payroll Voucher

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Processing Payroll for Contract Employees

The completed Payroll Voucher for Contract Employees for the month of August 2009 will
appear as shown:

Figure 9.8 Completed Payroll Voucher

□ Press Enter to Accept.

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Lesson 10: Payroll Reports

Payroll Reports help you ascertain the payroll expenses for a specified month or for year-to-date
(YTD) transactions for a particular employee/ group along with the Attendance and Production
details. You can also view the statutory forms required for Provident Fund and Employee State
Insurance. In Tally.ERP 9, the Payroll reports can be broadly categorized into two viz.,
□ Payroll Reports
□ Payroll Statutory Reports

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Payroll Reports

Payroll Reports
In Tally.ERP 9, you can generate the following Payroll related reports.

Chart showing Payroll Reports in Tally.ERP 9

Figure 10.1 Payroll Reports in Tally.ERP 9

164
Payroll Reports

We shall discuss each report in detail in the sections as explained below:

Pay Slip
A Pay Slip refers to a document issued to an employee, which itemises each component of his/
her earnings and deductions and the net amount paid for a given pay period. It provides particu-
lars on how the net amount has been arrived at i.e., how much money has been earned and how
much tax / deductions have been made.

Display Pay Slip

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip >
Single Pay Slip
□ Select the required Employee and press Enter
The Pay Slip for the selected employee is displayed as shown:

Figure 10.2 Pay Slip

In Tally.ERP 9 Payroll, the Pay Slip can be configured to vertically display the details of attend-
ance, in terms of attendance or production, with Year to Date Values (YTD).

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□ Press F12: Configure and set the following options to Yes

Figure 10.3 Pay Slip F12: Configuration screen

Some of the options in F12: Configuration screen, are by default set to Yes
viz., Show Employee Details, Show Attendance/Production Details,
Show Attendance/Production Groups, Remove Zero Entries for Attend-
ance/Production also based on the Payroll Features / Payroll Statutory
features enabled during voucher entry.

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The F12:Configuration options in Pay Slip are explained as follows:

□ Show Vertical Pay Slip – Set this option to Yes to view / print the Pay
Slip in vertical format, i.e. align Deductions pay heads below Earnings
pay heads
□ Show Employee Details – Set this option to Yes to display employee
information as entered in the employee master
□ Show Passport Details – Set this option to Yes to display an
employee’s passport details
□ Show Visa Expiry Date – Set this option to Yes to display an
employee’s visa expiry date
□ Show Joining Date – Set this option to Yes to display the date of joining
for Employee
□ Show Attendance/Production Details – Set this option to Yes to dis-
play Attendance/Production information
□ Show Attendance/Production Groups – Set this option to Yes to dis-
play the grouping of the Attendance/Production data as defined during
the creation of Types
□ Display Attendance/Production Type in Tail Units – For compound
units used in Attendance/Production Type, set this option to Yes, to dis-
play the value of the Attendance/Production details in the Tail unit. If this
option is set to No, the Production units will display in primary units
□ Show Year To Date values – Set this option to Yes to display the cumu-
lative value of Attendance/Production records and Earnings /Deductions
for any given period
□ Show Gross Salary - Set this option to Yes by setting the ‘Show Year
To Date values’ to No, to view Gross Earnings and Deductions for any
given period
□ Remove Zero Entries – Set this option to Yes to remove the Earnings/
Deductions components with Zero value from the Pay Slip
□ For Attendance/Production also – Set this option to Yes to remove
Attendance/ Production records with zero values from the Pay Slip
□ Appearance of Employee Names – Select the appropriate name style
to appear in the Pay Slip (i.e., Alias (Name), Alias only, Name (Alias),
Name only)
□ Appearance of Pay Head Names – Select the appropriate name style
to appear for each Pay Head in Pay Slip (i.e. Alias(Name), Alias only,
Name(Alias), Name Only, Pay Slip Name)

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The Pay Slip with the above configurations is displayed as shown:

Figure 10.4 Pay Slip with YTD values

The Pay Slip now displays the Attendance with Present / Overtime details, Year to Date balance,
and so on. To view the Pay Slip in vertical form, press F12: Configure and set Show Vertical Pay
Slip to Yes.

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The Vertical Pay Slip is displayed as shown:

Figure 10.5 Configured Pay Slip with Vertical Display

□ You can view additional information in the Pay Slip, by pressing Alt+F1.

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The detailed Pay Slip is displayed as shown:

Figure 10.6 Detailed Pay Slip

The voucher number, date and the number of attendance or payroll records are displayed as
shown in the above image. This is very useful when multiple attendance/payroll vouchers are
entered for the same payroll period. You can drill down to the voucher level for reference or to
effect an alteration by pressing Enter on the required record.

Period Button – By default, the Pay Slip for the current month is displayed.
However, you can change the period by pressing F2: Date and defining the
required date. This button can be used to display multiple period payroll infor-
mation to view/print a consolidated Pay Slip.
Employee Button – From the existing Pay Slip of an employee, you can tog-
gle between employees by pressing F4: Employee.

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Printing Pay Slip

□ Press Alt+P from the Pay Slip screen, the Printing Pay Slip screen is displayed as
shown:

Figure 10.7 Pay Slip Print Configuration screen

Some of the configuration in the Printing screen, are similar to F12: Configure and can be config-
ured from either of the screens. Additionally, the Show Authorised Signatory option is available
in the above screen.
□ In the Printing Pay Slip screen, press Backspace and enable the required option as
required
□ Press Enter to Print

Additional Options in the Pay Slip Printing screen:

□ Show Pay Slip Note: This option should be set to Yes if you want to
print the Pay Slip Note to appear instead of Authorised Signatory
details. The content of this Note can be modified from F12: Configura-
tion screen from Gateway of Tally.
□ Show Pay Slip Message: This option should be set to Yes if you want to
print the customised message on the Pay Slip for specific occasions.
e.g. Happy new Year!!!!

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The printed Pay Slip of Mr. Vijay Kumar is displayed as shown:

Figure 10.8 Printed Pay Slip

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Emailing Pay Slip

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip >
Single Pay Slip
□ Select the required Employee and press Enter
□ Press Alt+M, the Mailing Pay Slip screen is displayed as shown:

Figure 10.9 Mailing Pay Slip sub screen

□ In the Mailing Pay Slip screen,

■ Specify the SMTP Server Name in the Email Server field
■ Press Enter to accept the From & From E-mail Address fields (The company name &
Email id is defaulted from the company master, however you can modify the same)
■ Specify the Authentication User Name and Password, if required
■ Set Use SSL to No
■ Select HTML (Web publishing) in the Format field
■ Select the required Resolution from the Resolutions drop down
■ Press Enter to accept the To Email Address (The Employee address is defaulted from
the Employee Master, however, you may modify as required)
■ Enter the other information as required

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The completed Mailing Pay Slip configuration screen is displayed as shown:

Figure 10.10 Completed Mailing Pay Slip sub screen

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Mailing Pay Slip Configurations

□ Email Server – Name of the SMTP mail server should be specified.
□ From - The From field is prefilled with the name of your Company as
specified in the Company Creation screen. You can change the same if
you want some other name to be displayed.
□ From E-mail Address is pre-filled with the Company’s e-mail address
as filled during the Company Creation.
□ Authentication User Name and Password field should be filled if your
SMTP Server needs Authentication for sending e-mails.
□ Use SSL - This is set to Yes for the servers using the Secured Socket
Layer protocol for extra security reasons.
□ Format - you can select the format in which the Pay Slip should be
viewed by the mail recipient.
□ Resolution - appropriate resolution for the Emailed Pay Slip can be
selected in this field.
□ To E-Mail Address - this will be selected automatically if the e-mail
address is provided in the Employee Master. Or else, you need to spec-
ify the same at the time of emailing.
□ CC To (if any) - If you want the Pay Slip to be sent to another e-mail
address, it can be specified here.
□ Subject - specify the Subject of email to be seen by the user.
□ Additional Text (if any) - This will appear in the body of the email that is
sent.
□ Information Sent - The option to send the E-mail as an Attachment or
as a direct view can be selected here.
Other options are similar same as Pay Slip Configurations.

□ Press Enter to Email the Pay Slip

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The Pay Slip sent by e-mail when viewed from the mail box of the employee is as shown:

Figure 10.11 Emailed Pay Slip

Exporting Pay Slip to MS Excel

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip >
Single Pay Slip
□ Select the required Employee and press Enter
□ Press Alt+E, the configuration screen to select the required format appears as shown:
□ In the Export screen, specify the details as shown:

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The completed Export screen is displayed as shown:

Figure 10.12 Export Pay Slip screen

The Pay Slip exported into Excel will appear as shown:

Figure 10.13 Exported Pay Slip

The Pay Slip can also be exported to pdf, jpeg or other formats as per the requirement.

Multi Pay Slips

Tally.ERP 9 provides the flexibility to print, E-Mail or export selected or all Pay Slips on Click of a
Button.
Before E-mailing the Pay Slips to all Employees, you can check whether the Email ID’s are entred
correctly for all Employees.

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E-mail IDs
To check the E-Mail IDs entered,
Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip > E-
Mail IDs

Figure 10.14 E-Mail IDs - Exceptions Only

The above report displays the Employees’ for whom the E-Mail iD’s are either not entered or
incorrectly entered. You can press Ctrl+Enter to add or alter the E-Mail ID’s for the required
Employees.To view the E-Mail ID’s for all Employees you can press F5: All Items from the above
report.

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The E-Mail IDs report for all the Employees is as shown:

Figure 10.15 E-Mail IDs for All Employees

ail/Print/Export Multi Pay Slips

To E-Mail/Print/Export all the Pay Slips or selected Pay Slips,

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip >
Multi Pay Slips

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□ Select the appropriate Employee Category and Employee Group in the Employee FIlters
subscreen as shown:

Figure 10.16 Employee Filters

□ Press Enter to view the Multi Pay Slip report as shown:

Figure 10.17 Multi Pay Slip screen

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Tally.ERP 9 provides the flexibility to E-Mail/Print or Export all Pay Slips from the above screen
using the standard Alt+M/Alt+P/Alt+E buttons from the above screen.
The options in the email/print and Export screens are similar to Single Pay Slip report already dis-
cussed.

To E-Mail/Print/Export Pay Slips for selective Employees, you have to select

the required Employees using the Space bar.
If the cursor is on a particular Category or a Group, then the Pay Slips
belonging to that Category or Group only will be E-Mailed/Printed/
Exported.

Pay Sheet
A Pay Sheet is a columnar report which displays the Group/Department-wise break-up of employ-
ees’ earnings and deductions for the selected month.
Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Sheet
□ Select the All Items in the Name of Employee Category field
□ Select All Items in the Name of Employee / Group as shown:

Figure 10.18 Employee Filters

□ Press Enter to display the Pay Sheet

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The Pay Sheet is displayed as shown:

Figure 10.19 Pay Sheet

You can further configure the Pay Sheet to display the net amount, column subtotals, Category/
Group subtotals, user-defined Pay Slip names, Employee names and sort it by Employee number
in the F12: Configure.
The F12: Configuration from the Pay Sheet screen is displayed as shown:

Figure 10.20 F12: Configuration

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The F12:Configuration options in the Pay Sheet are explained as follows.

□ Appearance of Pay Head Types – Select the required Pay Head
Types from Deductions, Earnings or All Items.
□ Show Net Amount Column – Set this option to Yes to display the Net
Payable Column.
□ Show Column SubTotals – Set this option to Yes to display the subto-
tals of Earnings/Deductions pay head columns.
□ Remove Zero Entries – Set this option to Yes to eliminate Earnings/
Deductions pay heads with Zero values.
□ Show Pay Slip Names for Ledgers – Set this option to Yes to display
the Name defined in the Appear in Pay Slip field in the pay head master.
□ Include Employee Groups & Categories – Set this option to Yes to
display Category-wise/ Group-wise pay sheet. If this option is set to No,
the Pay Sheet will appear Employee-wise.
□ Show Category/Group Total – Set this option to Yes to display Cate-
gory and Group-wise columnar pay head totals.
□ Show Grand Total – Set this option to Yes to display the sum of all pay
head columns appearing in the report.
□ Show Attendance Details - Set this Option to Yes to display the Attend-
ance for the Employees
□ Display Production types in Tail Units - Set this Option to Yes to show
the Overtime details in minutes.
□ Format – Select Detailed mode to view Pay Sheet information of
employees with their respective category and group. Select Condensed
mode when only sum totals are required for each category and group.
□ Show Employee Number – Set this option to Yes to display employee
numbers.
□ Show Employee Designation - Set this Option to Yes to show the des-
ignation for employees.
□ Expand all levels in Detailed Format – Set this option to Yes to
expand all levels and display Employee details.
□ Appearance of Names – Select the appropriate name style to appear in
the paysheet (viz., Alias (Name), Alias only, Name (Alias), Name only).
□ Sorting Method – Sort the Pay Sheet either by Alphabetically increas-
ing / decreasing, Employee number or by the Default method.

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□ Set the F12: Configuration screen is displayed as shown:

Figure 10.21 F12: Configuration screen - Pay Sheet

The Pay Sheet with the above configurations will appear as shown:

Figure 10.22 Pay Sheet

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To view the Pay Sheet till date with Category and Group Totals,
□ Press Alt+F2 and change period as 01-04-2009 to 31-08-2009
□ Press F12: Configure and set Show Category/Group Total to Yes
The Pay Sheet with Category and Group Totals displays is displayed as shown:

Figure 10.23 Pay Sheet with Category and Group Total

Button options:
□ Detailed/Condensed Button – This button (Alt+F1) is used to toggle
between the detailed and condensed modes of reporting.
□ Period button – This option (F2) is used to define the periodicity of the
report, i.e. for a day, week, fortnight, month, quarter, half-year, year or
any given period.

To view the Pay Sheet for a particular Employee Group,

□ Press Ctrl+F7 from the Pay Sheet display, the Employee Filters screen is displayed
□ In the Employee Filters screen,
■ Select Primary Cost Category in the Employee Category field
■ Select Sales as the Employee group

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The Employee Filters screen is displayed as shown:

Figure 10.24 Employee Filters

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The Pay Sheet for the selected Employee Group is displayed as shown:

Figure 10.25 Employee Group Pay Sheet

You can also drill down from the above report to the voucher level, by highlighting the pay heads
column of the required employee and pressing Enter.

Button Options:
□ Employee Filter Button – By using the Employee Filter button
(Ctrl+F7), view the individual employee/ Employee group pay sheet
report.
□ New Column – This option (Alt+C) is used to add a new column for any
other Pay Head, which is not part of the pay structure.
□ Alter Column – This option (Alt+A) is used to replace an existing col-
umn in the report with another Pay Head column.
□ Delete Column -– This option (Alt+D) is used to delete an existing col-
umn in the report.

You can also print the Pay Sheet, by pressing Alt+P and specifying the required options in the
Pay Sheet Print configuration screen.

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The Pay Sheet Print Configuration screen is displayed as shown:

Figure 10.26 Pay Sheet Print Configuration screen

188
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The Printed Pay Sheet is displayed as shown:

Figure 10.27 Printed Pay Sheet (Landscape view)

While printing the Pay Sheet, you can choose to Increase the Line Height (for each employee
line) if you want to create space for the employee’s signature or to affix a stamp. Such a Pay
Sheet can also be used for the salary disbursement register.

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□ Press Alt+P to print Pay Sheet and set the Increase Line Height for Signature/ Stamp?
field to Yes
The printed Pay Sheet with space for signature/ stamp is as shown.

Figure 10.28 Printed Pay Sheet with space for Signature/ Stamp

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Page 2 of the Printed Pay Sheet is as shown:

Figure 10.29 Printed Pay Sheet with space for Signature/ Stamp – Page 2

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You can also E-mail or use Export Pay Sheet Report in the manner as
discussed in Pay Slip Section. The navigation steps for E-mailing and
Exporting Pay Sheet is similar to the steps explained in Pay Slip Report.

Payroll Statement
A Payroll Statement is a columnar report which displays Group/Department-wise employees’
break-up of selected earnings or deductions, for a specified month or period.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Payroll
Statement
□ Select the required pay head and press Enter
The Payroll Statement for Basic Pay Earnings Head for the month of April 2009 is displayed as
shown:

Figure 10.30 Payroll Statement

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You can further configure the Payroll Statement to display the Employee groups and categories,
category/group subtotals, grand totals, user-defined Pay Slip names, employee names, employee
bank details, sort it by Employee number, by pressing F12: Configure
□ Enter the details in F12: Configuration screen as shown
The F12: Configuration screen is displayed as shown:

Figure 10.31 F12: Configuration

The F12: Configuration options in Payroll Statement Report are as follows:

□ Remove Zero Entries – Set this option to Yes to remove Earnings/
Deductions pay head information with Zero values.
□ Show Pay Slip Names for Ledgers – Set this option to Yes, to view the
names of pay heads as specified in the Name to Appear in Pay Slip
field in the Pay Head master creation.
□ Include Employee Groups & Categories – Set this option to Yes to
display Category and Group-wise Employee information.
□ Show Category/Group Total – Set this option to Yes, to display Cate-
gory and Group-wise Totals.
□ Show Grand Total – Set this option to Yes, to display the sum of all the
pay head columns in the report.
□ Format – Select the mode Detailed to view payroll information of
employees with their respective categories and groups. Select the Con-
densed mode when only sum totals are required for each category and
group.

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□ Show Employee PF Account Number – Set this option to Yes, to dis-

play the Provident Fund Account number of an employee.
□ Show Income Tax Number (PAN) – Set this option to Yes, to display
the Income Tax Permanent Account Number (PAN) of an employee.
□ Show Employee Bank Details – Set this option to Yes, to display the
Bank Account Number of an employee
□ Show Employee Number – Set this option to Yes, to display the
Employee Number of an employee.
□ Show Employee ESI Number – Set this option to Yes, to display the
State Insurance Number of an employee.
□ Show Employee Passport Details – Set this option to Yes, to display
an employee’s passport details.
□ Show Employee Visa Expiry Date – Set this option to Yes, to display
an employee’s visa expiry date.
□ Expand all levels in Detailed format – Set this option to Yes, to
expand all levels and display Employee details.
□ Appearance of Names – Select the appropriate name style to appear in
the Payroll Statement (Alias (Name), Alias only, Name (Alias), Name
only).
□ Sorting Method – Sort the Payroll Statement using Alphabetical
(Decreasing), Alphabetical (Increasing), Bank details, Employee
Number, ESI Number, Income Tax Number (PAN), Passport Details, PF
Account Number, or by the default method.

The Employee PF Account Number, IT PAN Number, ESI Number, Passport

Details, Visa Expiry Date options will be available in F12: Configure only
when the options, Show Statutory details and Passport & Visa details, are
set to Yes in F12: Payroll Configuration.

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The Payroll Statement with the above Configurations is displayed as shown:

Figure 10.32 Payroll Statement with additional information

□ You can also Email or Export Payroll Statement in the manner as dis-
cussed in Pay Slip Section.
□ The Button Bar options in Payroll Statement are same as in the Pay-
sheet report.

To view Payroll Statement for other Pay Heads, you can either select other Pay Head(s) in the
manner as discussed or you may also include other Pay Heads in the above report for compara-
tive analysis or to obtain a cumulative value, by pressing Alt+C and selecting the required Pay
Head(s).

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The Payroll statement with additional Pay Heads will be displayed as shown:

Figure 10.33 Payroll Statement with additional Columns

Payment Advice
A Payment Advice is an intimation letter containing the details of employees with their bank
account numbers issued to the banker to transfer a specified sum (salaries earned) to the
employees’ bank accounts.

As discussed earlier, the contents of the Payment Advice can be altered in F12: Payroll Configu-
ration as per the employer’s requirements.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Payment
Advice

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The Printing Configuration for Payment Advice is displayed as shown:

Figure 10.34 Printing Configuration for Payment Advice

□ Press Backspace and enter the details as shown above

□ Press Enter to print

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The printed Payment Advice for May 2009 will appear as shown:

Figure 10.35 Printed Payment Advice

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□ The Payment Advice will be available only when the Salaries are proc-
essed through Bank Transfer and a Payment voucher is passed for the
salaries payable for a given month/period.
□ You can also Email or Export Payment Advice in the manner as dis-
cussed in Pay Slip Section.

Payroll Register
A Payroll Register is a month-wise transaction summary report which displays the number of
payroll vouchers passed during a particular month. Additional information can be appended into
the Payroll Register, by inserting a new column with the required voucher type i.e., Attendance,
Journal, Purchases, Sales and so on.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Payroll
Register
The Payroll Register is displayed as shown:

Figure 10.36 Payroll Register

□ Press F12: Configure and set the Appearance of Names and the Periodicity to use as
shown.

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The F12: Configuration screen is displayed as shown:

Figure 10.37 F12: Configuration

The Payroll Register with the above configurations is displayed as shown:

Figure 10.38 Payroll Register - Quarterly

Tally.ERP 9 allows you to drill down to the voucher level from the above display for any kind of
verification. Use the Enter key on the required month/period to drill down to the required level.

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The Payroll Register voucher level screen is displayed as shown:

Figure 10.39 Payroll Voucher Register

You can further drill down to the transaction level, by selecting the required transaction and
pressing Enter.

Employee Pay Head Breakup

An Employee Pay Head Breakup report is a columnar report which displays the Group/Depart-
ment-wise employees’ breakup of a selected earnings or deductions pay head for a specified
month/period. This report also displays the opening balance, debit and credit transactions and the
closing balance for a specified period.
This report is also helpful in tracking loan outstandings and instalments deducted till date or for
any specified period.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Employee Pay
Head Breakup

□ Select the required Pay Head from the List of Pay Heads and press Enter

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The Employee Breakup of Pay Head for Basic pay screen is displayed as shown:

Figure 10.40 Employee Breakup of Pay Head

To drill down to Employee Summary report from the above display,

□ Select Employee Category and press Enter
□ Press Alt+F1 to view the detailed report

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The Employee Summary screen is displayed as shown:

Figure 10.41 Employee Summary

You can also Email or Export Employee Breakup of Pay Head Report in
the manner as discussed in Pay Slip Section.

To drill down to the Employee Monthly Summary report from the Employee Summary report,
□ Highlight the required employee and press Enter

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The Employee Monthly Summary screen is displayed as shown:

Figure 10.42 Employee Monthly Summary

To further drill down to Employee Voucher level screen from the Employee Monthly Summary
report, press Enter on the required month.

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Payroll Reports

The Employee Summary voucher level screen is displayed as shown:

Figure 10.43 Employee Vouchers Summary

You can further drill down to the transaction level, by selecting the required transaction and
pressing Enter.

The Employee Breakup of Pay Head report can be viewed with additional Pay Heads, by
pressing Alt+C and adding the required Pay Head and by pressing Alt+N for multiple periods.

Pay Head Employee Breakup

A Pay Head Employee Breakup report displays the sum of transactions and closing balance of
the transacted groups for the selected employee.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Pay Head
Employee Breakup

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The Employee Selection screen is displayed as shown:

Figure 10.44 Employee Selection

To view the Pay Head breakup,

□ Select the required Employee from the List of Employees and press Enter
□ Press Alt+F1 for a detailed view

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The ledger-wise Breakup of Employee screen is displayed as shown:

Figure 10.45 Pay Head Employee Breakup

To further drill down to view the Breakup of Employee report for each ledger from the above
displayed report, select the required ledger and press Enter.

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The Breakup of Employee screen for a selected ledger (Basic Pay) is displayed as shown:

Figure 10.46 Ledger Monthly Summary

You can drill down further to view the Monthly Summary of the selected ledger and the Employee
Voucher report.

The Pay Head Employee Breakup report can be viewed with additional employees, by pressing
Alt+C and adding the required Employee and for multiple periods, by pressing Alt+N.

Attendance Sheet
An Attendance Sheet is a columnar report which displays the details of Attendance/ Production
types with the number of attendance/ production units achieved during a particular month or
period.

Go to Gateway of Tally > Display > Payroll Reports > Attendance Sheet

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The Attendance Sheet is displayed as shown:

Figure 10.47 Attendance Sheet

You may configure the above report with additional details, by pressing F12:Configure and
enabling the following options, as required.
The completed F12: Configuration screen is displayed as shown:

Figure 10.48 F12: Configuration screen

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F12: Configurations for Attendance Sheet:

□ Remove Zero Entries – Set this option to Yes, to remove Attendance/
Production information with Zero values.
□ Include Employee Groups & Categories – Set this option to Yes, to
display Category and Group-wise Employee information.
□ Show Category/Group Total -– Set this option to Yes, to display Cate-
gory and Group-wise Totals.
□ Include Group Attendance/Production Types – Set this option to Yes
to include Group Attendance/Production Types in Attendance Sheet
report.
□ Display Attendance/Production Types in Tail Units – Set this option
to Yes, to display the Attendance/Production Types in Tail Units.
□ Format – Select the Detailed mode to view the payroll information of
employees with their respective categories and groups. Select the Con-
densed mode when only sum totals are required for each category and
group.
□ Expand all levels in Detailed Format – Set this option to Yes, to
expand all levels and display Employee details.
□ Show Employee Number – Set this option to Yes, to display employee
numbers of employees.
□ Appearance of Names – Select the appropriate name style to appear in
the payroll statement (Alias (Name), Alias only, Name (Alias), Name
only)
□ Sorting Method – Sort the Attendance Sheet, either by Employee
Number or by the Default method.

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The Attendance Sheet with the above Configurations is displayed as shown:

Figure 10.49 Attendance sheet

Attendance Register
An Attendance Register is a month-wise transactions summary report which displays the number
of attendance vouchers passed during the month. You can append additional information by
inserting a new column with the required voucher type, i.e. Payroll, Journal, Purchases, Sales and
so on.

Go to Gateway of Tally > Display > Payroll Reports > Attendance Register

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The Attendance Register is displayed as shown:

Figure 10.50 Attendance Register

□ Press F12: Configure and set the Appearance of Names and the Periodicity to use as
shown
The F12:Configuration options in Attendance Register are as displayed below:

Figure 10.51 F12: Configuration for Attendance Register

Tally.ERP 9 allows you to drill down to the voucher register, from the Attendance Register screen
for any kind of verification.

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The Voucher level screen from Attendance Register is displayed as shown:

Figure 10.52 Attendance Voucher Register

You may further drill down to voucher level, by pressing Enter on the required transaction.

Expat Reports
Expat Reports provide information about regular as well as contractual employees, working
abroad on a short/ long tenure or on assignment. They capture all the relevant information in
respect of passport, visa and contract details along with the date of joining, the issuing country
and the expiry date. In Tally.ERP 9, the following Expat reports are available.
□ Passport Expiry
□ Visa Expiry
□ Contract Expiry

Passport Expiry Report

The Passport Expiry Report provides information on the passport details of employees, such as
passport number, country of Issue, passport expiry date and other details such as the employee's
date of joining and email id.

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Passport Expiry

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The Passport Expiry Report is displayed as shown:

Figure 10.53 Passport Expiry Report

□ Press F12: Configure to configure additional options

The F12: Configuration screen is displayed as shown:

Figure 10.54 F12: Configuration screen

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□ Show All Employees – Set this option to Yes, to view the passport
details of all employees. It includes information on expired and unex-
pired passport details. If this option is set to No, Show Expiry in days will
be available.
□ Show Expiry in days – Set this option to Yes, to enter the expiry days.
When Show All Employees and Show Expiry in days options are set
to No, Tally.ERP 9 filters only those employee passport details, which
are nearing the expiry date. If this option is set to Yes, Expiry in next n
days will be available.
□ Expiry in next n days – Set this option to Yes, to get the passport
expiry details for the next specified number of days. On entering the
number of days, Tally.ERP 9 filters the employee passport details which
are likely to expire within the specified period (number of specified days).
If this option is left blank, the report will denote the current date (last date
of voucher entry).
□ Show Employee Number – Set this option to Yes, to display the
employee number of employees in the report.
□ Appearance of Names – Select the appropriate name style to appear in
the Passport Expiry Report (Alias (Name), Alias only, Name (Alias),
Name only).
□ Sorting Method — Sort employee details based on Employee Number,
Passport Expiry Date (Ascending/Descending), or by the default
method.
□ Show Employee Email Id – Set this option to Yes, to view the email ids
of employees.

Button options in Passport Expiry Report:

□ F2: Change Period – Allows you to change the period of the report.
□ F5: Employee Wise – Allows you to display the Employee-wise Pass-
port Expiry report.
□ F7: Employee Filters – This option (Ctrl+F7) allows you to display the
Passport Expiry Report for a particular Employee Category with the
required Group or Employee.

Visa Expiry Report

The Visa Expiry Report provides information on the visa details of employees i.e., visa number,
visa Expiry date and other details such as the employee's date of joining and email id.

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Visa Expiry

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The Visa Expiry Report is displayed as shown:

Figure 10.55 Visa Expiry Report

The F12: Configuration and Button Options are the same as shown in
Passport Expiry Report.

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Contract Expiry Report

The Contract Expiry Report provides information on the contract details of employees on assign-
ment/ contract. It displays the contract particulars such as work permit number, contract start and
expiry date along with the employee’s date of joining and the email id.

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Contract Expiry

The Contract Expiry Report is displayed as shown:

Figure 10.56 Contract Expiry Report

The F12: Configuration and Button Options are the same as shown in
Passport Expiry Report.

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Payroll Statutory Reports

In Tally.ERP 9, you can display, print statutory forms and reports for Provident Fund (EPF),
Employee State Insurance (ESI) and Professional Tax (PT) in the prescribed format as required
by the statutes. The following Statutory reports are available in Tally.ERP 9:

Figure 10.57 Payroll Statutory Reports in Tally.ERP 9

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Payroll Reports

You can view Payroll Statutory reports either from the Statutory Reports menu or Payroll Reports
menu i.e., Gateway of Tally > Display > Statutory Reports > Payroll Reports or Gateway of
Tally > Display > Payroll Reports > Statutory Reports

Provident Fund Reports

As mentioned earlier, the following Provident Fund Reports are available in Tally.ERP 9:
□ EPF Computation report
□ Form 5
□ Form 10
□ Form 12A
□ PF Monthly Statement
□ Form 3A
□ Form 6A

In this section, we will generate each of the above mentioned forms / report and understand the
purpose and information to be furnished.

i. PF Computation Report
The PF Computation Report provides the summary of Amount Payable and amount paid in
respect of PF for a given period comprising of Employer Contributions, Employee Deductions and
Employer’s Other charges, if any. To view PF Computation Report, follow the steps given below:

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Computation
□ Press F2 and specify the period as 01-07-2009 to 31-07-2009 and press Enter

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The Payroll Statutory Computation Report is displayed as shown:

Figure 10.58 Payroll Statutory Computation Report

The report, by default displays the summary of Employee’s Provident Fund, Employees’ State
Insurance and Professional Tax. You may however configure to display only details of Provident
Fund.
□ Press F12: Configure and enable/disable the following options as required

□ Press Enter

Figure 10.59 F12: Configurations screen

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The PF Computation report will is displayed as shown:

Figure 10.60 PF Computation screen

To view detailed ledger wise information under each contributions / deductions head, press
Alt+F1.

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The detailed Provident Fund Computation Report is displayed as shown:

Figure 10.61 Detailed PF Computation Report

You can further drill down to Employee Breakup of Pay Head report and from there to Employee
Vouchers and so on, by pressing Enter on the required ledger from the above screen.

ii. Form 5
In accordance with the Employees' Provident Funds Scheme,1952 [para 36 (2)(a)], a return is
required to be submitted in Form 5 within 15 days of the following month detailing the list of
Employees qualifying for membership to the Employees’ Provident Fund for the First time during
every month.
Form 5 is a monthly Returns to be submitted with the details of any new employee covered under
EPF. In Tally.ERP 9, you can generate Form 5 in the prescribed format containing the details of
the new joinees in the organisation for the selected month. To generate the PF Form 5 for the
month of June 2009, follow the steps given below:

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
Form 5
In the Payroll Statutory Print Configuration screen,
□ Specify 01-06-2009 and 30-06-2009 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee / Group field

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□ Select Account Number as the Sorting Method

□ Specify 30-06-2009 in the Date field
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.62 Payroll Statutory Print Configuration screen

□ Press Enter to print.

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The printed PF Form 5 is displayed as shown:

Figure 10.63 PF Form 5

In our case study, there are two new employees who have joined during the month of June 2009
and thus Form 5 contains the details of these employees.

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iii. Form 10
In accordance with the Employees' Provident Funds Scheme,1952 [para 36 (2)(a) & (b), a Return
is required to be submitted in Form 10 within 15 days of the following month detailing the list of
members leaving service during the month.

Form 10 is a monthly Return to be submitted with the details of employees leaving the organisa-
tion. In Tally.ERP 9, on resignation or retirement or expulsion of any employee, the date of leaving
is required to be specified in the Employee master of such employee. The Date of Leaving option
in the Employee Master is available in the alteration mode. Form 10 contains the details of
Employees for whom the date of leaving is specified in the Employee Master.

You can generate Form 10 in the prescribed format containing the details of the employees who
have resigned in the selected month. To generate the PF Form 10 for the month of August 2009,
follow the steps given below.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
Form 10
In the Payroll Statutory Print Configuration screen
□ Specify 01-09-2009 and 30-09-2009 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee / Group field
□ Select Account Number as the Sorting Method
□ Specify 30-09-2009 in the Date field
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.64 Payroll Statutory Print Configuration screen

□ Press Enter to print

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The printed Form 10 is displayed as shown:

Figure 10.65 Printed Form 10

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iv. Form 12A

In accordance with the Employees' Provident Funds Scheme, 1952 [para 36(1)] and the Employ-
ees' Pension Scheme 1995 [para 20(4)] and the Employees' Deposit Linked Insurance Scheme,
1976, a consolidated Statement of dues and remittance is required to be submitted by 25th of the
following month to which the dues relate.
You can generate Form 12A in the prescribed format containing the details of the amount of con-
tribution, amount of contribution remitted and the date of remittance in respect of EPF, Pension
Fund and EDLI Contribution for the selected month. To generate the PF Form 12A for the month
of August 2009, follow the steps given below.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
Form 12A
In the Payroll Statutory Print Configuration screen
□ Specify 01-08-2009 and 31-08-2009 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee / Group field
□ Specify the Name & Address of the Bank
□ Set Include VPF Account to No
□ Specify 2 in the Number of Contract Employees field
□ Press Enter to accept 0 in Number of Rest (Temporary Employees) field
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.66 Completed Print Configuration screen

□ Press Enter to print

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The printed Form 12A is displayed as shown:

Figure 10.67 Printed Form 12A

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v. PF Monthly Statement
The PF Monthly Statement provides a summary of Employee wise monthly PF Employee Deduc-
tions and Employer Contribution amounts. To print the PF Monthly Statement, follow the steps
given below:
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
Monthly Statement
In the Payroll Statutory Print Configuration screen,
□ Specify 01-08-2009 and 31-08-2009 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee / Group field
□ Select Account Number as the Sorting Method

Figure 10.68 Print Configuration screen

□ Press Enter to Print.

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The printed PF Monthly Statement for August 2009 is displayed as shown:

Figure 10.69 PF Monthly Statement

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vi. Form 3A
As per the Employees' Provident Funds Scheme,1952 [para 35 & 42] and the Employees'
Pension Scheme 1995 (Para 19), a Form (Member’s Annual Contribution Card) showing month
wise recoveries towards EPF and Pension Fund in respect of a member for one financial year is
required to be furnished by the employer before 30th April of the following year.

Form 3A is a annual contribution card to be furnished for each employee in separate sheets to
EPFO. To print Form 3A, follow the steps given below:

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
Form 3A
In the Payroll Statutory Print Configuration screen
□ Select All Items in the Employee Category field
□ Select All Items in the Employee/Group field
□ Specify 01-03-2009 and 28-02-2010 in the From and To fields respectively
□ Specify 28-02-2010 in the Date of Printing field
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.70 Payroll Statutory Print Configuration

□ Press Enter to Print.

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The printed Form 3A for Ajay is displayed as shown:

Figure 10.71 Printed PF Form 3A

The next page will contain the Contribution Card in Form 3A for the next employee.

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vii. Form 6A
As per the Employees' Provident Funds Scheme,1952 [para 43] and the Employees' Pension
Scheme 1975 [para 20], a Form (Consolidated Annual Contribution Statement) providing annual
contributions of each member of the establishment is required to be submitted by 30th April.
Form 6A is a vital form for compiling the annual Provident Fund statement of a subscriber. In
Tally.ERP 9, you can generate Form 6A in the prescribed format. To print Form 6A, follow the
steps given below:
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
Form 6A
In the Payroll Statutory Print Configuration screen
□ Specify 01-03-2009 and 28-02-2010 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee/Group field
□ Select Account Number as the Sorting Method
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.72 Payroll Statutory Print Configuration for PF Form 6A

□ Press Enter to Print.

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The printed Form 6A is displayed as shown:

Figure 10.73 Printed Form 6A - Page 1

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The Page 2 of PF Form 6A is displayed as shown:

Figure 10.74 Printed Form 6A - Page 2

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viii. E-Return for PF Form 3A

Tally.ERP 9 also allows to generate the PF Form 3A in dbf fomat. The dbf format of this form can
be copied to a CD and submitted to the PF department.
To generate the PF Form 3A in dbf format,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
E-Return
□ Press Backspace and specify the details as shown:

Figure 10.75 Exporting Form 3A in dbf format

□ Press Enter to Export the form in the required format.

The Out File Name can be changed with the .dbf extension to by default
export the form in the required format. Or the Form can be exported in the
Excel Format and renamed by changing the extension as .dfb.

Employee’s State Insurance Reports

As mentioned earlier, the following ESI Reports are available in Tally.ERP 9:
□ ESI Computation Report
□ Form 3
□ ESI Monthly Statement
□ Form 5
□ Form 6
In this section, we will generate each of the above forms / report and understand the purpose and
information to be furnished.

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i. ESI Computation Report

The ESI Computation Report provides the summary of Amount Payable and amount paid in
respect of ESI for given period comprising of Employer Contributions and Employee Deductions.
To view ESI Computation Report, follow the steps given below:

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Computation
□ Press F2 and specify the period as 01-07-2009 to 31-07-2009 and press Enter

Figure 10.76 Payroll Computation report

The report, by default displays summary of Employee’s Provident Fund, Employee’s State
Insurance and Professional Tax, you may however configure to display only details of Employee
State Insurance.
□ Press F12: Configure and enable/disable the following options as required

□ Press Enter

Figure 10.77 F12: Configuration screen

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The ESI Computation report is displayed as shown:

Figure 10.78 ESI Computation report

To view the detailed ledger wise information under each contributions / deductions head, press
Alt+F1.

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The detailed Employee State Insurance Computation Report is displayed as shown:

Figure 10.79 Detailed ESI Computation report

You can further drill down to Employee Breakup of Pay Head report and from there to Employee
Vouchers and so on, by pressing Enter on the required ledger from the above screen.

ii. ESI Form 3

As per Regulation 14, a declaration form in Form 3 is required to be filed for every Half Yearly
stating the list of Employees whose remuneration is not exceeding Rs. 10,000/- per month. To
generate ESI Form 3, follow the steps given below:

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Employee State
Insurance > Form 3
In the Payroll Statutory Print Configuration screen,
□ Specify 1-08-2009 and 31-08-2009 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee/Group field
□ Select Account Number as the Sorting Method
□ Select All Items in the field Gender
□ Type Bangalore in the Place field
□ Specify 31-08-2009 in the Date of Printing field

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□ Type the Designation details of the person submitting the declaration form
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.80 Payroll Statutory Print Configuration for ESI Form 3

□ Press Enter to Print.

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The printed Form 3 (Return of Declaration) is displayed as shown:

Figure 10.81 Printed Form 3

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iii. ESI Monthly Statement

The ESI Monthly Statement provides a summary of Employee wise monthly ESI Employee
Deductions and Employer Contribution amount. To print ESI Monthly Statement, follow the steps
given below:
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Employee State
Insurance > Monthly Statement
In the Payroll Statutory Print Configuration screen,
□ Specify 01-08-2009 and 31-08-2009 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee/Group field
□ Select Account Number as the Sorting Method

The completed Payroll Configuration Print screen is displayed as shown:

Figure 10.82 Payroll Statutory Print Configuration screen

□ Press Enter to Print.

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The printed ESI Monthly Statement for August 2009 is displayed as shown:

Figure 10.83 ESI Monthly Statement

iv. Form 5
As per Regulation 26, a Return of Contribution in Form 5 is required to be submitted to the appro-
priate Branch Office within 42 days of the expiry of the contribution period (i.e, 12th May or
November 11th of each year). Such return of contribution should be prepared in quadruplicate
and submitted separately for the main Code Number and each sub-code number.

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The employer may make compliance from the parent unit and submit only one return in respect of
all the branches or may make compliance through their Branch Offices/ Sales Offices separately
in the Regions where such offices are located.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Employee State
Insurance > Form 5
In the Payroll Statutory Print Configuration screen
□ Specify 01-04-2009 and 30-09-2009 in the From and To fields respectively
□ Select All Items in the Employee Category field
□ Select All Items in the Employee/Group field
□ Select Account Number as the Sorting Method
□ Specify Bangalore in the Place Field
□ Specify 30-09-2009 in the Date of Printing field
□ Type the name of the Signatory in the Authorised Signatory Name field
□ Type the Designation details of the signing authority
□ In the Residential Address field provide the Home Address of Authorised Signatory

The completed Payroll Statutory Print Configuration screen for ESI Monthly Statement is
displayed as shown:

Figure 10.84 Payroll Statutory Print Configuration screen

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□ Press Enter to Print

The printed From 5 is displayed as shown:

Figure 10.85 Printed Form 5 - Page 1

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The Page 2 of Form 5 (includes the CA Form also) is displayed as shown:

Figure 10.86 Printed Form 5 - Page 2

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The Page 3 of Form 5 is displayed as shown:

Figure 10.87 ESI Form 5 - Page 3

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v. ESI Form 6
As per Regulation 32, a register of Employees covered under Employees State Insurance
Scheme, containing information regarding the Insurance No., dispensary, other occupational
details, Employer’s Share and month wise (under that particular Half Year) ESI details (i.e., Gross
wages, Number of working days and ESI Contribution for each employee) should be furnished. To
generate Form 6, follow the steps given below:
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Employee State
Insurance > Form 6

In the Payroll Statutory Print Configuration screen

□ Type 01-04-2009 in the From field
□ Type 30-09-2009 in the To field
□ Select All Items in the Employee Category field
□ Select All Items in the Employee/Group field
□ Select Account Number as the Sorting Method
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.88 Payroll Statutory Print Configuration for ESI Form 6

□ Press Enter to Print.

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The printed Form 6 is displayed as shown:

Figure 10.89 Printed Form 6 - Page 1

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The Page 2 of Form 6 is displayed as shown:

Figure 10.90 Printed Form 6 - Page 2

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The Page 3 of Form 6 is displayed as shown:

Figure 10.91 Printed Form 6 - Page 3

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Professional Tax Reports

As discussed earlier, Professional Tax is applicable to those individuals or professionals in India
who are involved in any profession or trade. The state government of each state governs and
administers the levy and collection of Professional Tax in the respective State. The state is
empowered with the responsibility of structuring as well as formulating the professional tax criteria
for the respective state. Professional tax is charged on the incomes of Individuals, profits of
business or gains in vocations as per the list II of the Indian Constitution.
In India, the professional tax slabs vary from state to state and some of the states have formulated
different professional tax slabs for men, women and the senior citizens of the respective states.
The rates depend upon the profession, years in the profession and the amount of income or
turnover and so on.
In Tally.ERP 9, the Professional Tax Report is generated based on the Slab Rates defined in the
Professional Tax Ledger and it captures the amount of Professional Tax deducted under each
slab rate.

i. Professional Tax Computation Report

The Professional Tax Computation Report provides the summary of Amount deducted as Profes-
sional Tax from the Earnings of the Employees exceeding the prescribed threshold limits, in
accordance with the Slab rates applicable for the particular state.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Professional Tax >
Computation Report
□ From the List of Ledgers drop down, select Professional Tax and press Enter, the Pay-
roll Statutory Print Configuration screen appears
□ In the Payroll Statutory Print Configuration screen,
■ Specify 01-08-2009 and 31-08-2009 in the From and To fields respectively
■ Select All Items in the Employee Category field
■ Select All Items in the Employee/Group field
■ Type Bangalore in the Place field
■ Specify 31-08-2009 in the Date of Printing field

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The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.92 Payroll Statutory Print Configuration screen

■ Press Enter to Print.

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The printed Professional Tax Computation report for the month of August 2009 will appear as
shown:

Figure 10.93 Printed PT Computation Report

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ii. Professional Tax Statement

The Professional Tax Statement provides the summary of Employee wise Gross Wages paid, No.
of Working Days and the amount of Professional Tax deducted during the selected period. To
generate the Professional Tax Statement for a month,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Professional Tax >
Statement
□ From the List of Ledgers drop down, select Professional Tax and press Enter, the Pay-
roll Statutory Print Configuration screen appears
□ In the Payroll Statutory Print Configuration screen,
■ Specify 01-08-2009 and 31-08-2009 in the From and To fields respectively
■ Select All Items in the Employee Category field
■ Select All Items in the Employee/Group field
■ Select Employee Name as the Sorting Method
The completed Payroll Statutory Print Configuration screen will appear as shown:

Figure 10.94 Payroll Statutory Print Configuration screen

□ Press Enter to Print.

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The printed Professional Tax Statement for August 2009 is displayed as shown:

Figure 10.95 Printed Professional Tax Statement

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You can view PT Computation Report from Gateway of Tally > Display >
Payroll Reports > Statutory Reports > Computation menu, detailing Pro-
fessional Tax collected and paid during a given period in the manner as
discussed in Provident Fund Computation Report section.

Gratuity Report
The Gratuity Report displays the provisional liability of an employer towards his employee in
respect of gratuity payable at the time of cessation of employment either by resignation, death,
retirement or termination.

The Gratuity Summary Report displays the gratuity amount payable in accordance with the pay
components and formulae defined in the ledger master, as discussed earlier. In Tally.ERP 9, the
Gratuity amount is calculated proportionately for eligible days in a year to the extent of completed
months of service.

You can view the Gratuity Report either from Statutory Reports menu or Payroll Reports menu i.e.,
Gateway of Tally > Display > Payroll Reports > Statutory Reports or Gateway of Tally >
Display > Statutory Reports > Payroll Reports.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Gratuity Report

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The Gratuity Report for the Employees eligible for Gratuity is displayed as shown:

Figure 10.96 Gratuity Summary Report

The above report displays the Gratuity Amount computed for each month for each Employee.

In order to ascertain the Gratuity payable amount, set Use for Gratuity to
Yes in the Pay Head master (i.e. Basic Pay, Dearness Allowance etc.)

258
Payroll Reports

Button Options in the Gratuity Report:

□ F5: Employee Wise – Allows you to display the Employee-wise Gratuity
report.
□ F6: Till Date – Allows to actual gratuity payable for each employee. The
Gratuity Amount will be displayed only for those Employees who have
completed the eligibility duration in the organisation.
□ F7: Employee Filters – This option (Ctrl+F7) allows you to display the
Gratuity report for a particular Employee Category with the required
Group or Employee.

The above report displays the details of all employees along with the Date of Birth, Date of Joining
and the Gratuity Eligible Salary, besides commenting on the total Gratuity liability as on date.

Press F12: Configure to configure for additional options

Figure 10.97 F12: Configuration screen

Tally.ERP 9 allows you to drill down to the Gratuity Details report from the above display.
□ Select the required employee and press Enter

259
Payroll Reports

The Gratuity Details screen is displayed as shown:

Figure 10.98 Gratuity Details Report

Once the employee is deactivated (i.e., when the date of leaving is filled in the
Employee master), Tally.ERP 9 stops computing Gratuity for the deactivated
employee. If the tenure of service of such an employee falls below the eligible
slab for gratuity calculation, he/she will not be entitled for any gratuity amount.
However, in cases where the tenure of service is spread over more than one
eligible slab(s), he/she will be entitled to the sum total of all the slabs.

The above report displays the detailed Gratuity computation for all the slabs entered during the
Gratuity Pay Head Creation.

260
Implementation of
Payroll in Tally.ERP 9
The information contained in this document is current as of the date of publication and subject to change. Because Tally must respond
to changing market conditions, it should not be interpreted to be a commitment on the part of Tally, and Tally cannot guarantee the
accuracy of any information presented after the date of publication. The information provided herein is general, not according to
individual circumstances, and is not intended to substitute for informed professional advice.

© 2009 Tally Solutions Pvt. Ltd. All rights reserved.

Version: Implementation of Payroll in Tally.ERP 9/1.8/June 2010

Contents

Introduction ............................................................................................................................................................................... 1

Lesson 1: Configuring Payroll in Tally.ERP 9

Lesson 2: Creation of Payroll Masters

Lesson 3: Processing Payroll in Tally.ERP 9

Lesson 4: Accounting for Employer PF Contributions

Lesson 5: Accounting for Employer ESI Contributions

i
Contents

Lesson 6: Payment of Professional Tax

6.1 Processing of Professional Tax Payment ................................................................................................ 128

Lesson 7: Tracking of Salary Advances / Loans

Lesson 8: Accounting for Pay Revision & Arrears

Lesson 9: Processing Payroll for Contract Employees

Lesson 10: Payroll Reports

ii
Introduction

Lesson Objectives
On completion of this lesson, you will have learnt:

□ The features of Payroll in Tally.ERP 9

□ How to enable Payroll in Tally.ERP 9

Payroll in Tally.ERP 9 is easy to use and can handle all the functional, accounting and statutory
requirements of the payroll department.

Salient Features of Payroll in Tally.ERP 9

Enabling Payroll in Tally.ERP 9

In Tally.ERP 9 activation of Payroll requires a one time simple setup. Create a new company in
Tally.ERP 9 and follow the steps given below to enable Payroll.

Case Study Company

M/s. Spectrum Software Solutions is engaged in the Software services Business. It is a
Bangalore-based company with the following three major departments:
□ Sales
□ Administration
□ R&D

Step 1: Company Setup

Figure 1.1 Company Creation screen

□ Press Enter to Accept the completed Company Creation screen

Step 2: Enable Payroll

The completed F11: Accounting Features screen is displayed as shown:

Figure 1.2 F11: Accounting Features screen

□ Press Enter to Accept the F11: Accounting Features screen

Once the Payroll feature is activated in Tally.ERP 9, the following two new options get activated in
the F11: Statutory & Taxation Master

Step 3: Enable Payroll Statutory Features

Go to Gateway of Tally > press F11: Company Features > press F3: Statutory & Taxation
In F11: Statutory & Taxation Features screen:
□ Set Enable Payroll Statutory to Yes

5
Configuring Payroll in Tally.ERP 9

□ Set Set/Alter Payroll Statutory Details to Yes

Figure 1.3 F11: Statutory & Taxation Features screen

□ Press Enter

In the Payroll Statutory Details screen:

□ Enter the Provident Fund & Employee State Insurance details of the company as
shown:

Figure 1.4 Payroll Statutory Details screen

6
Configuring Payroll in Tally.ERP 9

□ Press Enter to Accept the screen and go back to F11: Statutory & Taxation Features
screen
□ Press Ctrl+A to Accept the screen.

7
Lesson 2: Creation of Payroll Masters

Lesson Objectives
On completion of this lesson, you will have learnt how to:

□ Create Payroll Masters in Tally.ERP 9

7
Creation of Payroll Masters

The Payroll feature in Tally.ERP 9 requires minimal effort for accurate payroll processing. It takes
five easy steps to process payroll & generate Pay Slip in Tally.ERP 9.

Figure 2.1 Payroll Cycle

8
Creation of Payroll Masters

□ Salary Details

Tally.ERP 9 provides the flexibility to create the Employees and Group them under specific
Employee Group which in turn can be created under specific Employee Categories.

The following masters can be created in Tally.ERP 9 to successfully record the Employee Details:
□ Employee Category
□ Employee Groups
□ Employees

The Employee Category will provide an additional level to classify the

Employees in a logical manner. In the case study, in this book all the
Employee Groups are created under Primary Cost Category, hence creation
of an additional Category is not shown.

To create Sales as an Employee Group:

9
Creation of Payroll Masters

The Employee Group Creation screen is displayed as shown:

Figure 2.2 Employee Group Creation screen

4. Press Enter to Accept the Employee Group Creation screen

Similarly, create the other Employee Groups such as Administration and R&D.

10
Creation of Payroll Masters

The F12: Payroll Configuration screen is displayed as shown:

Figure 2.3 F12: Payroll Configuration screen

□ Press Enter to Accept

Create the following Employee Masters:

11
Creation of Payroll Masters

4. Specify the Date of Joining as 01-04-2009

5. Type the other details of the employee as shown:

Figure 2.4 Employee Creation screen

6. Press Enter to Accept the screen

The option Date of Leaving and Reason for Leaving will be available only in
the Alteration mode.

Similarly, create the Employee Masters for other employees with their respective departments.

12
Creation of Payroll Masters

i. Simple Payroll Units

The completed Unit Creation screen is displayed as shown:

Figure 2.5 Simple Unit Creation screen

5. Press Enter to Accept the Unit Creation screen.

Similarly, create Minutes as another Simple Unit.

ii. Compound Payroll Units

Create Hrs of 60 Mins as a Compound Unit.
In the Unit Creation screen:
1. Press Backspace and select Compound as the Type of Unit
2. Specify Hrs as the First Unit
3. Enter 60 as the Conversion

13
Creation of Payroll Masters

4. Specify Mins as the Second Unit

Figure 2.6 Compound Unit Creation screen

5. Press Enter to Accept the Unit Creation screen.

Attendance/ Production Types

i. Present Attendance Type

14
Creation of Payroll Masters

3. Select Attendance/ Leave with Pay as the Attendance Type and the Period Type appears
as Days, by default.

Figure 2.7 Attendance/ Production Type Creation screen

The completed Attendance Type Creation screen is displayed as shown:

Figure 2.8 Attendance/Production Type Creation Screen

4. Press Enter to Accept the Attendance Type Creation screen.

Figure 2.9 Attendance/ Production Type Creation screen

□ Press Enter to Accept the Attendance Type Creation screen.

15
Creation of Payroll Masters

In the same way, create Overtime as the Production Type with Production as the Attendance
Type.

iii. Overtime Production Type

The completed Overtime - Production Type Creation screen is displayed as shown below:

Figure 2.10 Overtime - Production Type Creation screen

□ Press Enter to Accept the Production Type Creation screen.

Attendance/Production Types details:

□ Present Attendance Type may be used when the pay value is

In Tally.ERP 9, each pay head is to be created as an individual ledger account and grouped under
its respective group i.e., all Earnings pay heads under Indirect Expenses group or Direct

16
Creation of Payroll Masters

Expenses group and all Deductions pay heads under Current Liabilities, Current Assets and
Duties & Taxes group.

The preset Pay Head types in Tally.ERP 9 are:

Create the following pay heads in the books of M/s. Spectrum Software Solutions.

Earning Pay Heads

i. Basic Pay Head Creation

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
In the Pay Heads Creation screen,

17
Creation of Payroll Masters

1. Type Basic Pay as the Name of the Pay Head

2. Select Earnings for Employees in the field Pay Head Type.

The Pay Head Creation screen is displayed as shown:

Figure 2.11 Basic Pay Head Creation – Pay Head Type Selection

Description of general parameters in Pay Head creation:

18
Creation of Payroll Masters

The Pay Head Creation screen with the List of Calculation is displayed as shown:

Figure 2.12 Basic Pay Head Creation - Calculation Type

Calculation Type refers to the method of computation of pay components. In

Tally.ERP 9, there are basically 5 calculation types.

8. Select Present in the field Attendance/ Leave with Pay.

19
Creation of Payroll Masters

The Pay Head Creation screen with the List of Attendance Types is displayed as shown below:

Figure 2.13 Pay Head Creation screen with List of Attendance Types

9. Select Months in Calculation period field and press Enter

20
Creation of Payroll Masters

The Pay Head Creation screen with the List of Calculation Periods is displayed as shown:

Figure 2.14 Pay Head Creation - Calculation Period selection

Tally.ERP 9 contains four predefined Calculation periods – Days, Fortnights,

Months and Weeks.

21
Creation of Payroll Masters

10. Select User defined in the Per Day Calculation Basis field

Figure 2.15 Pay Head Creation screen - Calculation Basis Selection

11. Press Enter to Accept

Calculation Basis refers to the periodicity of the given calculation period.

22
Creation of Payroll Masters

12. Specify the Months of 26 Days and press Enter

Figure 2.16 Pay Head Creation screen - Calculation period

13. Select Normal Rounding as the Rounding Method and press Enter.

Figure 2.17 Pay Head Creation screen – Rounding Method selection

23
Creation of Payroll Masters

14. Specify 1 as the rounding Limit (The Rounding limit allows the value to be in multiples of the
limit specified and is based on the Rounding Method selected)

There are 4 methods of Rounding Off in Tally.ERP 9 which are as follows:

□ Not Applicable – The decimal points will be taken into consideration,

The completed Basic Pay Head Creation screen is displayed as shown:

Figure 2.18 Completed Basic Pay Head Creation screen

15. Press Enter to Accept the screen.

24
Creation of Payroll Masters

ii. House Rent Allowance Pay Head Creation

Figure 2.19 HRA Pay Head Creation screen - Calculation Type selection

8. Select Normal Rounding as the Rounding Method and 1 as the rounding Limit and press
Enter

25
Creation of Payroll Masters

9. In the Computation Info screen, select On Specified Formula in the Compute field

Figure 2.20 Pay Head Creation screen with Compute method

Computation on details:

26
Creation of Payroll Masters

10. Press Enter and the Compute subscreen is displayed

11. In the Sub-screen Compute:
■ Select Basic Pay as the Add Pay Head function and press Enter

Figure 2.21 Compute sub-screen

27
Creation of Payroll Masters

■ Select End of List

Figure 2.22 Compute: On Specified Formula sub-screen

■ Press Enter to Accept the screen

28
Creation of Payroll Masters

14. Select Percentage as the Slab Type from the List of Slabs

Figure 2.23 Pay Head Creation screen - Slab Type selection

Slab Type Details:

Percentage – This Slab rate is used when the amount is stated as a propor-
tion of a whole.
Value – This Slab rate is used when the amount is stated as absolute value.

29
Creation of Payroll Masters

15. Specify 40% in the Value Basis field and press Enter

Figure 2.24 Pay Head Creation - Value Basis screen

The completed House Rent Allowance (HRA) Pay Head Creation screen is displayed as
shown.

Figure 2.25 Completed HRA Pay Head Creation screen

16. Press Enter to Accept the screen

30
Creation of Payroll Masters

iii. Conveyance Pay Head Creation

Create the Conveyance Pay Head with Calculation Type as Flat Rate.
The completed Conveyance Pay Head Creation screen is displayed as shown:

Figure 2.26 Conveyance Pay Head Creation

□ Press Enter to Accept the screen

31
Creation of Payroll Masters

iv. Overtime Pay Head Creation

Create the Overtime Pay Head with Calculation Type as Production.

The completed Overtime Pay Head Creation screen is displayed as shown:

Figure 2.27 Overtime Pay Head Creation screen

□ Press Enter to Accept the screen

32
Creation of Payroll Masters

v. Variable Pay Head Creation

Similarly, create the Variable Pay Head with Calculation Type as User Defined Value.

Figure 2.28 Variable Pay Head Creation

Deduction Pay Heads

Create the following Deduction Pay Heads.

33
Creation of Payroll Masters

i. Employee’s PF Contribution @ 12% Pay Head Creation

Figure 2.29 Employees' PF Contribution @ 12% Pay Head Creation

34
Creation of Payroll Masters

3. Select PF Account (A/c No. 1) in the Statutory Pay Type field as shown:

Figure 2.30 Employees' PF Contribution @ 12% Statutory Pay Type selection

35
Creation of Payroll Masters

10. In the Compute sub-screen, select Basic Pay as the Add Pay Head function and press
Enter

Figure 2.31 Deduction Pay Head Creation screen – Compute On selection

11. Press Enter to Accept the screen

12. Specify 1-4-2008 as the Effective From date
13. The column From Amount is automatically skipped, with the assumption that the amount is
zero

36
Creation of Payroll Masters

14. Specify 6500 in the Amount Upto column and press Enter

Figure 2.32 Deduction Pay Head Creation – Computation Info.

37
Creation of Payroll Masters

18. Specify Rs. 780 in the Value Basis field and then press Enter

Figure 2.33 Deduction Pay Head Creation screen with Value Basis

19. Press Enter twice

38
Creation of Payroll Masters

The completed Employee’s PF Contribution @ 12% Pay Head Creation screen is displayed as
shown:

Figure 2.34 Completed Employee’s PF @ 12% Pay Head Creation screen

20. Press Enter to Accept the screen.

ii. Employee’s ESI Contribution @ 1.75% Pay Head Creation

Create Employee’s State Insurance (ESI) Pay Head as discussed.

39
Creation of Payroll Masters

9. Select On Specified Formula in the field Compute and press Enter

Figure 2.35 Employee's ESI Pay Head creation screen - Compute On Selection

In the Compute On Sub-screen, subscreen,

■ Select Basic Pay as the Add Pay Head function and press Enter
■ Select House Rent Allowance as the second Pay Head in the Add Pay Head Func-
tion

40
Creation of Payroll Masters

■ Similarly, select Conveyance and Overtime Pay as the Add Pay Head function

Figure 2.36 Employee's ESI Pay Head creation screen - Add Pay Head selection

■ Select End of List and press Enter

Any income of a regular nature will be subject to ESI calculation viz., Basic
Pay, Dearness Allowance, House Rent Allowance, Conveyance, Overtime
etc.,)

10. Specify 1-4-2008 as the Effective From date

41
Creation of Payroll Masters

The Pay Head Creation screen is displayed as shown:

Figure 2.37 Employee's ESI Pay Head creation screen – Slab Rate

42
Creation of Payroll Masters

The completed ESI – Employee’s Contribution Pay Head Creation screen is displayed as
shown:

Figure 2.38 Completed ESI – Employee’s Contribution Pay Head Creation screen

14. Press Enter to Accept the screen.

iii. Professional Tax Pay Head Creation

Create Professional Tax Pay Head with the following Slab rates.

From Amount To Amount Professional Tax

Amount
0 5000 0
5000 8000 60
8000 10000 100
10000 15000 150
15000 - 200

43
Creation of Payroll Masters

The completed Professional Tax Pay Head Creation screen is displayed as shown:

Figure 2.39 Profession Tax Pay Head Creation

□ Press Enter to Accept

Gratuity Pay Head

44
Creation of Payroll Masters

Ledger Pay Head Type Under

Gratuity Expenses (Provisional) Gratuity Provisions (Current
Liabilities)

In the Pay Head Creation screen,

45
Creation of Payroll Masters

The Slab Rate Details for Gratuity calculation screen is displayed as shown:

Figure 2.40 Slab Rate Details for Gratuity Calculation screen

4. Press Enter to Accept the screen

Gratuity parameter details:

46
Creation of Payroll Masters

The completed Gratuity Expenses (Provisional) Pay Head Creation screen is displayed as
shown:

Figure 2.41 Gratuity Expenses Ledger Creation screen

6. Press Enter to Accept the screen.

Salary Details Setup

47
Creation of Payroll Masters

To define Salary Details for employees,

Go to Gateway of Tally > Payroll Info. > Salary Details > Create

Figure 2.42 List of Employee Groups/ Employees screen

48
Creation of Payroll Masters

The Salary Details Creation screen is displayed as shown:

Figure 2.43 Salary Details Creation screen

49
Creation of Payroll Masters

The completed Salary Details Creation screen for Mr. Vijay Kumar is displayed as shown:

Figure 2.44 Completed Salary Details screen

Tally.ERP 9 allows you to modify the pre-defined Slab rates by pressing F12:
Configure and setting the option Allow to Override Slab Percentage to
Yes.

In case a revision in pay structure is required for any subsequent period,

define the latest pay structure by specifying the relevant Effective from date.

50
Creation of Payroll Masters

Salary Details for Ajay can be created similar to the Salary Details creation for Vijay Kumar.

Since Ajay and Mahesh are in Sales Group, we can create the Salary Details for the Group and
inherit the same for the Employees (Ajay and Mahesh) in that Group.

Salary Details creation for the Sales Group

51
Creation of Payroll Masters

The completed Salary structure for the Sales Group is as shown:

Figure 2.45 Completed Salary Details for Sales Group

The Pay structure created above can be inherited for all the employees belonging to Sales Group.
This feature helps in eliminating the repetitions while creating the Salary Details.

52
Creation of Payroll Masters

The Salary Details Creation screen is displayed as shown:

Figure 2.46 Salary details Creation – Copy From Parent Value

Start Type Details:

53
Creation of Payroll Masters

The Salary Details Configuration screen is displayed as shown:

Figure 2.47 Salary Details Configuration

■ Press Enter to Accept

6. Now, you will be able to enter the user-defined pay rates to compute the HRA, specify 20% and
press Enter

In the Salary Details Configuration screen, when the option Allow to

Override Slab Percentage is set to Yes, the predefined slab rates for the
Pay Heads can be modified as per user requirements.

54
Creation of Payroll Masters

The completed Salary Details screen of Mr. Ajay is displayed as shown:

Figure 2.48 Completed Salary Details screen

7. Press Enter to Accept the screen.

Similarly, you can create the Salary Details for Mahesh and others employees.

55
Lesson 3: Processing Payroll in Tally.ERP 9

Lesson Objectives
On completion of this lesson, you will have learnt

□ To process Payroll in Tally.ERP 9

Typically, Payroll Processing comprises of the following activities:

□ Recording of Attendance and Production details (on time / work)
□ Processing Payroll Vouchers
□ Payment of Salaries

There are three types of Payroll Vouchers namely Attendance Voucher, Payroll Voucher and
Payment Voucher, which are by default preset in Tally.ERP 9 to record above Payroll transac-
tions.

56
Processing Payroll in Tally.ERP 9

Go to Gateway of Tally > Payroll Vouchers

1. Press Ctrl+F5 for Attendance Voucher
The Attendance Voucher Creation screen is displayed as shown:

Figure 3.1 Attendance Voucher Creation screen

2. Press F2 and specify the date as 30-4-2009

3. Press Enter
4. Press Alt+A (Attendance Auto Fill) to prefill employee payroll details

57
Processing Payroll in Tally.ERP 9

The Attendance Auto Fill screen is displayed as shown:

Figure 3.2 Attendance Auto Fill screen

In the Attendance Auto Fill screen,

Figure 3.3 Attendance Auto Fill - Employee Category selection

■ Select All Items as Employee/ Group (if you want to generate payroll voucher for indi-
vidual employee/ group, select the respective employee or group)

58
Processing Payroll in Tally.ERP 9

The Attendance Auto Fill with Employee Filters screen is displayed as shown:

Figure 3.4 Attendance Auto Fill with Employee List

■ Select Present as Attendance Type in the Attendance/ Production Type field

Figure 3.5 Attendance Auto Fill with List of Attendance Type

■ Specify the require value that should be prefilled for all Employees e.g. 26
■ Press Enter to accept the screen

59
Processing Payroll in Tally.ERP 9

Separate Attendance vouchers are required for recording attendance on

5. Employees pertaining to the respective Employee Groups are displayed automatically

Figure 3.6 Attendance Voucher

6. Alter the attendance details as given in the table above

60
Processing Payroll in Tally.ERP 9

The Attendance Voucher Creation screen with the attendance details screen is displayed as
shown:

Figure 3.7 Attendance Voucher

7. Press Enter
8. Enter the details of the transaction in the Narration field

61
Processing Payroll in Tally.ERP 9

The completed Attendance Voucher Creation for Present Attendance is displayed as shown:

Figure 3.8 Completed Attendance Voucher Screen

9. Press Enter to accept the completed Attendance Voucher screen.

In the same way, create an Attendance Voucher for Overtime Hours.

62
Processing Payroll in Tally.ERP 9

The completed Attendance Voucher for Overtime Hours is displayed as shown:

Figure 3.9 Attendance Voucher Screen - Overtime

□ Press Enter to accept.

You can also record Overtime in hours, provided the Unit of Measurement for
the Payroll unit is defined as Hrs.

After creating the Attendance Voucher, you can change any attendance value for a particular
employee, if required, in the Voucher Alteration mode.

63
Processing Payroll in Tally.ERP 9

Payroll Vouchers
A payroll voucher is used to record all employee-related transactions. It enables you to compute
all the values for the respective Pay Heads (Earnings and Deductions).

Cash Remittance

Example 2:
On 30th April, 2009, M/s. Spectrum Solutions processes Payroll for all the employees and
entitled the following employees for Variable Pay.

Particulars Vijay Kumar Rahul Mahesh Ajay

Variable Pay 1500 - 1000 -

Go to Gateway of Tally > Payroll Vouchers

Figure 3.10 Payroll Autofill with Process List

64
Processing Payroll in Tally.ERP 9

In Tally.ERP 9, the following processes are preset for faster processing of

■ Specify 1-4-2009 in the From field

■ Specify 30-4-2009 in the To field
■ Select All Items as Employee/Group

Figure 3.11 Payroll Autofill with List of Employees

■ Select Cash in the Payroll Ledger field

65
Processing Payroll in Tally.ERP 9

The completed Payroll Auto Fill screen is displayed as shown:

Figure 3.12 Payroll Autofill with payment Ledger list

■ Press Enter to accept the screen (the Cash ledger is prefilled in the Account field)

All the pay values are calculated for the applicable pay heads for each employee grouped under
the selected group.

66
Processing Payroll in Tally.ERP 9

The Payroll Voucher Creation screen is displayed as shown:

Figure 3.13 Payroll Voucher Creation

4. Press Enter and specify the pay values for the pay heads defined as user-definable values
against each employee (in this case, define the Variable Pay)

67
Processing Payroll in Tally.ERP 9

■ Specify 1000 as Variable Pay for Mahesh

Figure 3.14 Payroll Voucher - adding Variable pay

■ Similarly, specify 1500 as Variable Pay for Vijay Kumar and press Enter

68
Processing Payroll in Tally.ERP 9

The completed Payroll Voucher Creation screen is displayed as shown:

Figure 3.15 Completed Payroll Voucher

5. Press Enter to accept.

Example 3:
On 31st May, 2009 M/s. Spectrum Solutions disbursed Salaries payable for the month of
May 2009 through Bank Transfer. The attendance records displayed the following details:

69
Processing Payroll in Tally.ERP 9

Attendance/Production Vijay Kumar Rahul Mahesh Ajay

Types
Present Days 25 20 26 21
Overtime Hours - 120 Min
(2hr x 60min)

Step 1: Create Attendance Voucher

Create Attendance Vouchers for Present days and Overtime hours for May 2009 as per the
details given in the above table.

The completed Attendance Voucher for Present days is displayed as shown:

Figure 3.16 Attendance Voucher for Present days

□ Press Enter to accept

70
Processing Payroll in Tally.ERP 9

In the same way, create an Attendance Voucher for Overtime Hours.

The completed Attendance Voucher for Overtime Hours is displayed as shown:

Figure 3.17 Attendance Voucher for Overtime Hours

□ Press Enter to accept.

Step 2: Create Salary Payable Ledger

Before passing the Salary payment voucher, create the following ledger:
Ledger Pay Head Type Under
Salary Payable Not Applicable Current Liabilities

71
Processing Payroll in Tally.ERP 9

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
The completed Salary Payable Ledger creation screen is displayed as shown:

Figure 3.18 Salary Payable Ledger Creation

□ Press Enter to accept

Step 3: Create Payroll Voucher

Figure 3.19 Payroll Autofill with List of Processes

5. Specify 01-05-2009 in the From field

6. Specify 31-05-2009 in the To field

72
Processing Payroll in Tally.ERP 9

7. Select All Items as Employee/Group

8. Select Salary Payable in the Payroll Ledger field as shown

Figure 3.20 Payroll Autofill - Payroll Ledger selection

Figure 3.21 Completed Payroll Voucher

11. Press Enter to accept

73
Processing Payroll in Tally.ERP 9

After passing the above entry, the salaries payable for the month of May 2009 are transferred to
the Salary Payable Ledger, at the time of payment of salaries, the amount is reversed.

Payment of Salaries (Salary Disbursement)

Go to Gateway of Tally > Accounting Vouchers

Figure 3.22 Payment Auto Fill - Payment Process Selection

■ Specify 01-05-2009 as From period

74
Processing Payroll in Tally.ERP 9

The completed Payment Auto Fill screen is displayed as shown:

Figure 3.23 Payment Auto Fill screen

4. Press Enter and the employee payroll details will appear by default.
5. Enter the details of the transactions in the Narration field

The completed Payroll Payment Entry screen is displayed as shown:

Figure 3.24 Payment Voucher

6. Press Enter to accept.

If a partial payment of salaries is made to a particular group of employees, then generate a

separate payroll voucher for their payables and pass a separate payment entry based on the set-
tlement. However, Tally.ERP 9 also allows you to modify the payment amount to the Employees.

75
Processing Payroll in Tally.ERP 9

The unpaid salary will remain as outstanding in the Salary payable account and can be auto-filled
in the payment voucher as and when the actual payments are made.

76
Lesson 4: Accounting for Employer PF
Contributions

Lesson Objectives
On completion of this lesson, you will be able to

□ Process Employer’s Contributions to Provident Fund (PF)

□ Payment of Provident Fund Contributions
□ Generate the PF Combined Challan

77
Accounting for Employer PF Contributions

Once an establishment is covered under PF, all its departments and branches are covered, irre-
spective of where they are located.

i. Employees' Pension Scheme:

Benefits under the Scheme

ii. Employees Deposit Linked Insurance Scheme:

Benefit to nominee of employee

78
Accounting for Employer PF Contributions

Illustration 1:
On 30th April, 2009 M/s. Spectrum Software Solutions processed Provident Fund contribu-
tions for the month of April 2009 and paid the amount in full to EPFO.

The same is accounted as shown:

Creation of Employer PF Contribution Masters

I. Employer Contributions Pay Head

i. Employer Contribution EPS @ 8.33% Pay Head Creation

79
Accounting for Employer PF Contributions

3. In the field Statutory Pay Type, select EPS Account (A/c No. 10) as shown

Figure 4.1 Employer EPS @ 8.33% Pay Head Creation

80
Accounting for Employer PF Contributions

■ Select Basic Pay as the Add Pay Head function from the list of Pay Heads as shown.

Figure 4.2 Compute Subscreen

■ Select End of List

81
Accounting for Employer PF Contributions

The completed Employer EPS @ 8.33% Pay Head Creation screen is displayed as shown:

Figure 4.3 Completed Employer EPS Pay Head Creation Screen

8. Press Enter to accept

ii. Employer Contribution EPF @ 3.67% Pay Head

82
Accounting for Employer PF Contributions

The Pay Head Creation screen is displayed as shown:

Figure 4.4 Employer EPF @ 3.67% Pay Head Creation

83
Accounting for Employer PF Contributions

The Compute sub-screen is displayed as shown:

Figure 4.5 Compute Subscreen

■ Select End of List

84
Accounting for Employer PF Contributions

The completed Employer EPF @ 3.67% Pay Head Creation screen is displayed as shown:

Figure 4.6 Completed Employer EPF Pay Head Creation Screen

9. Press Enter to accept.

Alternatively, you can also define the criteria for computation of Employer PF
Contribution @ 3.67% Pay head, by selecting Basic Pay in the Compute sub-
screen. and defining the percentage as 3.67%.

II. Employer PF Admin Charges

85
Accounting for Employer PF Contributions

i. PF Administrative Charges @ 1.10% Pay Head Creation

Figure 4.7 PF Admin Charges Pay Head creation

86
Accounting for Employer PF Contributions

The completed PF Admin Charges @ 1.10% Pay Head Creation screen is displayed as shown:

Figure 4.8 Completed Pay Head Creation - PF Admin Charges

9. Press Enter to accept

ii. EDLI Contribution @ 0.5% Pay Head Creation

87
Accounting for Employer PF Contributions

3. In Statutory Pay Type filed select EDLI Contribution (A/c No. 21) as shown

Figure 4.9 EDLI Contribution Pay Head Creation

88
Accounting for Employer PF Contributions

The completed EDLI Contribution @ 0.5% Pay Head Creation screen is displayed as shown:

Figure 4.10 Completed Pay Head for EDLI Contribution

7. Press Enter to accept and save the Pay Head

iii. EDLI Administrative Charges @ 0.01% Pay Head Creation

89
Accounting for Employer PF Contributions

The Pay Head Creation screen is displayed as shown:

Figure 4.11 EDLI Admin Charges Pay Head Creation

■ Set Minimum Rs 2/Employee to Yes if you want the EDLI Admin Charges to be mini-
mum Rs. 2.

When the option Minimum Rs 2/Employee is set to Yes, the EDLI Admin
Charges for each employee is minimum Rs. 2 or actual value as calculated.

When this option is set to No the EDLI Admin Charges are calculated as per
the specified formula.

90
Accounting for Employer PF Contributions

The completed EDLI Admin Charges @ 0.01% Pay Head Creation screen is displayed as
shown:

Figure 4.12 Completed pay Head for EDLI Admin Charges

7. Press Enter to accept and save the Pay Head.

III. PF Payable Ledger

To process the Employer PF Contribution, create PF Payable Ledger as explained below:
Ledger Pay Head Type Under
PF Payable Not Applicable Current Liabilities

Go to Gateway of Tally > Payroll Info. > Payheads > Create

1. Type PF Payable in the Name field
2. In the Pay Head Type field select Not Applicable
3. Specify the Group as Current Liabilities in the Under field and press Enter

91
Accounting for Employer PF Contributions

The completed PF Payable Ledger creation screen is displayed as shown:

Figure 4.13 Completed PF Payable Ledger Creation

4. Press Enter to accept.

IV. PF Admin Expenses Ledger

To process the Employer Other Charges (PF Admin, EDLI Contribution and EDLI Admin
expenses), create PF Admin Expenses Ledger as explained below:
Ledger Under
PF Admin Expenses Indirect Expenses

Go to Gateway of Tally > Accounts Info. > Ledgers > Create

1. In the Name field, type PF Admin Expenses
2. Specify the group as Indirect Expenses in the field Under and press Enter

92
Accounting for Employer PF Contributions

The completed PF Admin Expenses Ledger creation screen is displayed as shown:

Figure 4.14 PF Admin Expenses Ledger Creation

3. Press Enter to accept

Salary Details setup

Create / Alter Salary Details Master

93
Accounting for Employer PF Contributions

The completed Salary Details screen is displayed as shown:

Figure 4.15 Salary Details Alteration Screen

94
Accounting for Employer PF Contributions

Processing Employer PF Contribution

Follow the steps explained below to process Provident Fund.

Figure 4.16 Payroll Auto Fill - Process List Selection

95
Accounting for Employer PF Contributions

■ Select PF Payable Ledger from the list of Ledger Accounts drop down in the Payroll
Ledger field as shown

Figure 4.17 Employee Filters screen – Payroll Ledger Selection

The values for the Employer PF contributions are prefilled in the Payroll Voucher for PF Contribu-
tion process.

96
Accounting for Employer PF Contributions

The Payroll Voucher for Employer PF Contribution is displayed as shown:

Figure 4.18 Payroll Voucher Creation - PF Contribution

5. Press Enter to accept

97
Accounting for Employer PF Contributions

The completed Payroll Voucher for Employer PF Contribution is displayed as shown:

Figure 4.19 Completed PF Contribution screen

6. Press Enter to accept.

Processing PF Admin Expenses

98
Accounting for Employer PF Contributions

■ Select PF Admin Expenses Ledger in the Expense Ledger field

Figure 4.20 Employer’s Other Charges screen – Expenses Ledger Selection

99
Accounting for Employer PF Contributions

■ Select PF Admin Charges @ 1.10% Ledger in the Admin Charges (A/c No. 2) field
as shown

Figure 4.21 Employer’s Other Charges screen – Admin Charges Ledger Selection

■ Similarly, select EDLI Contribution @ 0.5% and EDLI Admin Charges @ 0.01% in
the EDLI Contribution (A/c No. 21) and EDLI Admin Charges (A/c No. 22) fields
respectively.

100
Accounting for Employer PF Contributions

The completed Employer’s Other Charges subscreen is displayed as shown:

Figure 4.22 Completed Employer’s Other Charges screen

■ Press Enter
4. Type the details of the transaction in the Narration field

101
Accounting for Employer PF Contributions

The completed Employer PF Expenses Voucher is displayed as shown:

Figure 4.23 Completed PF Expenses Voucher screen

5. Press Enter to accept and save.

Payment of Provident Fund

To process the payment of Provident Fund, follow the steps given below:

Step 1: Create PF Payment Voucher

102
Accounting for Employer PF Contributions

■ Select PF Challan in the Process for field from the Process List screen

Figure 4.24 Employee Filters screen - Process Selection

Figure 4.25 Employee Filters screen - PF Ledger selection

4. Press Enter to prefill PF Payable Amount in respect of Employer Contributions during the
relevant month

103
Accounting for Employer PF Contributions

The Payment voucher is displayed as shown:

Figure 4.26 PF Payment Voucher with Employer PF Contribution details

104
Accounting for Employer PF Contributions

5. Press Enter again, to prefill the amount of Employee Contributions during the relevant
month

Figure 4.27 PF Payment Voucher - with Employee Contribution details

105
Accounting for Employer PF Contributions

6. Press Enter thrice again, to prefill EDLI Admin Expenses, EDLI Contribution and PF Admin
Charges during the selected month as shown:

Figure 4.28 PF Payment Voucher with Employer Other charges details

7. Press Enter twice

Figure 4.29 Payment details subscreen

106
Accounting for Employer PF Contributions

10. Press Enter to go back to the PF Payment Voucher screen

11.Type the details of the transaction in the narration field
The completed PF Payment Voucher screen for the month of April 2009, is displayed as shown:

Figure 4.30 Completed PF Payment Voucher screen

12. Press Enter to accept

Step 2: Print PF Payment Challan
□ Press Pg UP from the Voucher Entry screen shown above
□ Press Alt + P, the Voucher Printing screen is displayed as shown:

Figure 4.31 Voucher Printing Screen

107
Accounting for Employer PF Contributions

Figure 4.32 Printed PF Payment Challan

108
Lesson 5: Accounting for Employer ESI
Contributions

Lesson Objectives
On completion of this lesson, you will be able to

□ Process Employer’s Contribution to Employees’ State Insurance (ESI)

□ Payment of ESI Contributions
□ Generate the ESI payment Challan

109
Accounting for Employer ESI Contributions

The same is accounted as shown:

110
Accounting for Employer ESI Contributions

Creation of Employer ESI Contribution Masters

I. Create Employer ESI Contribution @ 4.75% Pay Head

Go to Gateway of Tally >Payroll Info >Pay Heads >Create

Figure 5.1 Pay Head Creation - Employer ESI

4. Specify the group as Indirect Expenses in the Under field and press Enter

111
Accounting for Employer ESI Contributions

5. Set Affect Net Salary to No and press Enter

Figure 5.2 Employer ESI Pay Head Creation – Compute sub-screen

■ Select End of List and press Enter to accept the screen

112
Accounting for Employer ESI Contributions

Figure 5.3 Employer ESI Pay Head Creation

113
Accounting for Employer ESI Contributions

The completed Employer ESI Contribution Pay Head Creation screen is displayed as shown:

Figure 5.4 Completed Employer ESI Pay Head

□ Press Enter to accept.

II. Create ESI Payable Ledger

Create ESI Payable Ledger as explained below:
Ledger Pay Head Type Under
ESI Payable Not Applicable Current Liabilities

114
Accounting for Employer ESI Contributions

The completed ESI Payable Ledger creation screen is displayed as shown:

Figure 5.5 ESI Payable Ledger Creation

4. Press Enter to accept

Salary Details setup

Create / Alter Salary Details Master

115
Accounting for Employer ESI Contributions

The completed Salary Details Alteration screen is displayed as shown:

Figure 5.6 Salary Details Alteration screen

4. Press Enter to Accept

Similarly, include Employer ESI @ 4.75% Pay Head in the Salary details of all other Employees.

116
Accounting for Employer ESI Contributions

Processing Employer ESI Contribution

Go to Gateway of Tally > Payroll Vouchers

Figure 5.7 Payroll Autofill - ESI process selection

□ Specify 1-6-2009 and 30-6-2009 in the From and To Date fields respectively
□ Select Primary Cost Category as Employee Category field
□ Select All Items in the Employee/ Group field

117
Accounting for Employer ESI Contributions

□ Select ESI Payable Ledger in the Payroll Ledger field as shown:

Figure 5.8 Payroll Autofill – Payroll Ledger selection

5. Press Enter to accept and go back to the Payroll Voucher screen

118
Accounting for Employer ESI Contributions

The completed Employer ESI Contribution Voucher Creation screen is displayed as shown:

Figure 5.9 Completed ESI Voucher

6. Press Enter to accept

□ The Employer ESI contribution will be computed automatically upon

119
Accounting for Employer ESI Contributions

To process the payment of ESI and generate ESI Challan, follow the steps given below:

Step 1: Create ESI Payment Voucher

Figure 5.10 Employee Filters subscreen - ESI Process Selection

120
Accounting for Employer ESI Contributions

□ Select HDFC Bank in the Bank / Cash Ledger field

Figure 5.11 Employee Filters Subscreen – Bank Ledger Selection

121
Accounting for Employer ESI Contributions

□ Select ESI Payable Ledger in the Payroll Ledger field

Figure 5.12 Employee Filters Subscreen - Payroll Ledger Selection

5. Press Enter to accept and go back to the Payment Voucher screen

122
Accounting for Employer ESI Contributions

6. Press Enter to prefill the Employer’s ESI Contribution amount for the eligible Employees

Figure 5.13 ESI Payment Voucher with Employer Contributions

123
Accounting for Employer ESI Contributions

7. Press Enter again, to prefill the Employee’s ESI Contribution amount against the eligible
Employees

Figure 5.14 ESI Payment Voucher with both Employee and Employer Contributions

8. Press Enter twice

9. Set Yes in the Provide Details field and press Enter
10. In the Provide Details subscreen, specify the Cheque / DD No., Cheque / DD Date and Bank
& Branch Code Details as shown:

Figure 5.15 Complete Provide Details subscreen

11. Press Enter to accept

12. Type the details of the transaction in the narration field

124
Accounting for Employer ESI Contributions

The completed ESI Payment Voucher for the month of June 2009 is displayed as shown:

Figure 5.16 Completed ESI Payment Voucher

13. Press Enter to accept

125
Accounting for Employer ESI Contributions

Step 2: Print ESI Payment Challan

□ Press Pg UP from the above Voucher Entry screen
□ Press Alt + P, the Voucher Printing screen is displayed as shown:

Figure 5.17 ESI Voucher Printing Screen

□ In the Voucher printing screen, select Yes in the Print Challan field
□ Press Enter to Print

126
Accounting for Employer ESI Contributions

The printed ESI Payment Challan for the month of June 2009 of M/s. Spectrum Software
Solutions is as shown:

Figure 5.18 Printed ESI Payment Challan

127
Lesson 6: Payment of Professional Tax

Lesson Objectives
On completion of this lesson, you will be able to:

□ Process payment of Professional Tax

6.1 Processing of Professional Tax Payment

128
Payment of Professional Tax

129
Payment of Professional Tax

■ Select HDFC Bank in the Bank / Cash Ledger field

Figure 6.1 Employee Filters screen - Payment Ledger Selection

■ Select Professional Tax in the Payroll Ledger field

130
Payment of Professional Tax

The completed Employee Filters screen will is displayed as shown:

Figure 6.2 Completed Employee Filters screen

■ Press Enter to accept the screen and go back to the Payment Voucher screen
■ Press Enter to prefill the Professional Tax amount in the Payment Voucher

131
Payment of Professional Tax

The completed Professional Tax Payment Voucher is displayed as shown:

Figure 6.3 Completed Professional Tax Payment Voucher

5. Press Enter to Accept.

Similarly, process the Professional Tax payments for other months.

□ The creation of Professional Tax Pay Head is discussed in detail in Cre-

ation of Masters chapter.
□ The procedure to process Professional Tax Deduction from Employee
Salaries is discussed in detail in the chapter Processing Payroll in
Tally.ERP 9.

132
Lesson 7: Tracking of Salary Advances / Loans

Lesson Objectives
On completion of this lesson, you will be able to:

□ Track Salary Advances / Loans and recoveries in Tally.ERP 9

133
Tracking of Salary Advances / Loans

I. Create Salary Advance Ledger

The completed Staff Salary Advance Ledger creation screen is displayed as shown:

Figure 1.1 Salary Advance Ledger

7. Press Enter to accept.

134
Tracking of Salary Advances / Loans

Modify / Alter Salary Details

The completed Salary Details screen is displayed as shown:

Figure 1.2 Completed Salary details alteration screen

5. Press Enter to accept.

135
Tracking of Salary Advances / Loans

Payment of Salary Advance

In Tally.ERP 9, you may disburse the Salary advance / Loans to Employees using a Payment
Voucher as shown:

Illustration 1:
On 2nd July, 2009 M/s. Spectrum Software Solutions paid Salary Advance to the following
Employees with the mode and amount of recovery.

Employee Name Salary Advance Mode of Recovery Amount

(Rs.) Recovery (Rs.) per month
Rahul 10,000 Monthly Salary 5,000
Rajesh 3,000 Monthly Salary 1,500

The same is accounted as shown:

i. Create Payment Voucher

Setup:
□ Press F12: Configure and set Use Single Entry mode for Pymt/Rcpt/Contra to No

Go to Gateway of Tally > Accounting Vouchers > Payment Voucher (F5)

1. Press F2 to change the date to 2-07-09

136
Tracking of Salary Advances / Loans

2. In the Dr field, select Staff Salary Advance ledger from the list of ledgers

Figure 1.3 Payment Voucher - Salary Advance Ledger selection

137
Tracking of Salary Advances / Loans

The Cost Centre Allocations screen is displayed as shown:

Figure 1.4 Payment Voucher – Cost Centre Allocation screen

□ Specify 10000 in the Amount field

□ Similarly, select other Employee (Rajesh) from the List of Cost Centres and specify the
amount (i.e., 3,000)

138
Tracking of Salary Advances / Loans

The Completed Cost Allocation for subscreen is displayed as shown:

Figure 1.5 Cost Centre Allocation – Sub-screen

□ Press Enter to accept and go back to the Payment Voucher

5. Select HDFC Bank in the Cr field and press Enter
6. Press Enter to accept the Amount
7. Type the details of the transaction in the narration field

139
Tracking of Salary Advances / Loans

The completed Payment Voucher for Salary Advance is displayed as shown:

Figure 1.6 Completed Payment Voucher

8. Press Enter to accept.

Recovery of Salary Advance

Attendance records for July 2009:

Attendance/ Pro- Vijay Rahul Mahesh Ajay Suresh Rajesh
duction Types Kumar
Present Days 26 24 22 25 21 20

140
Tracking of Salary Advances / Loans

ii. Create Payroll Voucher

The Payroll Voucher Creation screen is displayed as shown:

□ Tab down to Staff Salary Advance ledger field of Rahul and specify 5000 as the amount
to be deducted

Figure 1.7 Payroll Voucher - Salary Advance Recovery Entry

□ Similarly, tab down to Staff Salary Advance ledger field of Rajesh and specify 1500 as
the amount to be deducted

141
Tracking of Salary Advances / Loans

□ Similarly, enter the 1500 in Staff Salary Advance for Rajesh

The completed Payroll Voucher for July 2009 is displayed as shown:

Figure 1.8 Completed Payroll Voucher

□ Press Enter to accept.

142
Lesson 8: Accounting for Pay Revision &
Arrears

Lesson Objectives
On completion of this lesson, you will be able to:

□ Record Pay Revisions and Arrears in Tally.ERP 9

Salary Revision / Arrear Calculation for Prior Period

Illustration 1:
On 5th August, 2009 M/s. Spectrum Software Solutions revised the Salaries for the
following Employees. Such a revision is effective from 1st May 2009.

143
Accounting for Pay Revision & Arrears

The revised Salary structure is as follows:

Employee / Pay Components Basic HRA Conveyance Variable Pay
Mahesh 50000 40% 2000 User-defined

Step 1: Modify / Alter Salary Details

Figure 8.1 Salary Details Alteration Screen

144
Accounting for Pay Revision & Arrears

Start Type Options:

Figure 8.2 Completed Salary revision screen

□ Press Enter to accept

145
Accounting for Pay Revision & Arrears

Step 2: Arrear Calculation Voucher

The completed Auto Fill subscreen is displayed as shown:

Figure 8.3 Payroll Auto Fill subscreen

■ Press Enter to automatically prefill the salary arrear amounts for the selected period

146
Accounting for Pay Revision & Arrears

The completed Payroll Voucher for Arrear calculation is displayed as shown:

Figure 8.4 Payroll Voucher – Arrear calculation

□ Press Enter to Accept

Step 3: Payment of Arrears

147
Accounting for Pay Revision & Arrears

The completed Salary Arrears Payment voucher of Mahesh for the period from May 2009 to July
2009 is displayed as shown:

Figure 8.5 Salary Arrears Payment Voucher

□ Press Enter to Accept.

148
Accounting for Pay Revision & Arrears

Salary Revision / Arrear Calculation for current Period

Illustration 2:
On 15th August 2009, M/s. Spectrum Software Solutions revised the Salaries for the
following Employees. Such revision is effective from the current month i.e., August 2009.

The revised Salary structure is as follows:

Employee / Pay Components Basic HRA Conveyance Variable Pay
Ajay 11000 30% 2000 User-defined

The Attendance records for August 2009 is as follows:

Attendance/ Production Vijay Kumar Rahul Mahesh Ajay Suresh Rajesh
Types
Present Days 26 22 25 26 26 26

Step 1: Modify / Alter Salary Details

149
Accounting for Pay Revision & Arrears

The Salary Details Alteration screen is displayed as shown:

Figure 8.6 Salary Details Alteration screen

□ Press Enter to prefill the pay structure (comprising of Earning & Deduction Pay Heads) of
the preceeding period for the specified period
□ Press Enter on Basic Pay Pay Head and alter the amount to 11000
□ Press Enter on HRA Pay Head and alter the percentage to 30% (To alter the percentage,
ensure in F12: Configure, Allow to Override Slab Percentage is set to Yes)
□ Tab down to Conveyance Pay Head and alter the amount to 2000

150
Accounting for Pay Revision & Arrears

□ Press Enter to go to the End of List

The completed Salary Details screen is displayed as shown:

Figure 8.7 Completed Salary Alteration screen

□ Press Enter to Accept

Step 2: Record Attendance

Record Attendance voucher in the manner as explained in previous chapters.

151
Accounting for Pay Revision & Arrears

The completed Attendance Voucher for August 2009 is displayed as shown:

Figure 8.8 Completed Attendance Voucher

Step 3: Process Payroll Voucher

Go to Gateway of Tally > Payroll Vouchers

152
Accounting for Pay Revision & Arrears

The completed Payroll Voucher for August 2009 is displayed as shown:

Figure 8.9 Completed Payroll Voucher

You may process Employer and Employee’s contribution to Provident Fund and Employee’s State
Insurance and payment of Profession Tax in the manner as discussed in the earlier chapters.

153
Lesson 9: Processing Payroll for Contract
Employees

Lesson Objectives
On completion of this lesson, you will be able to:

□ Process Salaries for Contract Employees

In this Chapter, we will discuss the recording of transactions related to computation of salaries for
Contractual employees.

Illustration 1:
On 5th August 2009, M/s. Spectrum Software Solutions hired two persons on contract.

The list of employees along with the contract details is as follows:

S. No. Name of Employee Department / Group Tenure Start Date End Date
1 James Contract Employees 6 Months 5 Aug 09 5 Feb 10
2 Vineet Contract Employees 9 Months 5 Aug 09 5 May 10

154
Processing Payroll for Contract Employees

The Salary details for the above contract employees is as shown:

Employee / Pay Heads Basic Wages Overtime Local Conveyance
James 2000 50 / hr On Actuals
Vineet 2500 50 / hr On Actuals

The same is accounted for as shown:

Create Employee Masters

As discussed in the earlier chapters, you need to create the following Employee Masters to:
1. Employee Group
2. Employees

I. Create Employee Group Master

Figure 9.1 Completed Employee Group Creation

□ Press Enter to Accept

155
Processing Payroll for Contract Employees

II. Create Employee Master

Figure 9.2 Employee Creation screen

Similarly, create other Employee Masters i.e., Vineet.

Create Pay Heads

156
Processing Payroll for Contract Employees

i. Create Basic Wages Pay Head

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
The completed Basic Wages Pay Head creation screen is displayed as shown:

Figure 9.3 Pay Head Creation – Basic Wages

□ Press Enter to Accept.

Similarly, create Overtime Pay Head with On Production as the Attendance Type.

157
Processing Payroll for Contract Employees

ii. Create Local Conveyance Pay Head

The completed Local Conveyance Pay Head Creation screen is displayed as shown:

Figure 9.4 Pay Head Creation – Local Conveyance

□ Press Enter to Accept.

iii. Salary Details setup

Create the salary details for the above contract employees as discussed in the earlier chapters.

158
Processing Payroll for Contract Employees

The completed Salary Details creation screen for James is displayed as shown.

Figure 9.5 Salary Details creation screen

□ Press Enter to Accept.

Similarly, create the Salary Details for Vineet.

Record Attendance details

The Attendance and Overtime Details for Contract Employees for August 2009 is as shown.
Attendance/Production Type James Vineet
Absent 1 2
Overtime 15 Hrs 17 Hrs

Step 1: Create Attendance Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F5 for Attendance Vouchers

159
Processing Payroll for Contract Employees

The completed Attendance Voucher for the Contract Employees is displayed as shown:

Figure 9.6 Completed Attendance Voucher

□ Press Enter to Accept

Step 2: Create Production Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F5 for Attendance Vouchers

160
Processing Payroll for Contract Employees

The Production Voucher for Overtime hours is displayed as shown:

Figure 9.7 Completed Production Voucher

□ Press Enter to Accept.

Process Payroll
On 31st August 2009, M/s. Spectrum Software Solutions processed salaries for the
contract employees through Cash. The Local Conveyance for August 2009 is as follows:

Reimbursements Particulars James Vineet

Local Conveyance 1250 1225

The same is accounted as shown:

Create Payroll Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F4 for Payroll Voucher

161
Processing Payroll for Contract Employees

The completed Payroll Voucher for Contract Employees for the month of August 2009 will
appear as shown:

Figure 9.8 Completed Payroll Voucher

□ Press Enter to Accept.

162
Lesson 10: Payroll Reports

163
Payroll Reports

Payroll Reports
In Tally.ERP 9, you can generate the following Payroll related reports.

Chart showing Payroll Reports in Tally.ERP 9

Figure 10.1 Payroll Reports in Tally.ERP 9

164
Payroll Reports

We shall discuss each report in detail in the sections as explained below:

Display Pay Slip

Figure 10.2 Pay Slip

In Tally.ERP 9 Payroll, the Pay Slip can be configured to vertically display the details of attend-
ance, in terms of attendance or production, with Year to Date Values (YTD).

165
Payroll Reports

□ Press F12: Configure and set the following options to Yes

Figure 10.3 Pay Slip F12: Configuration screen

166
Payroll Reports

The F12:Configuration options in Pay Slip are explained as follows:

167
Payroll Reports

The Pay Slip with the above configurations is displayed as shown:

Figure 10.4 Pay Slip with YTD values

168
Payroll Reports

The Vertical Pay Slip is displayed as shown:

Figure 10.5 Configured Pay Slip with Vertical Display

□ You can view additional information in the Pay Slip, by pressing Alt+F1.

169
Payroll Reports

The detailed Pay Slip is displayed as shown:

Figure 10.6 Detailed Pay Slip

170
Payroll Reports

Printing Pay Slip

□ Press Alt+P from the Pay Slip screen, the Printing Pay Slip screen is displayed as
shown:

Figure 10.7 Pay Slip Print Configuration screen

Additional Options in the Pay Slip Printing screen:

171
Payroll Reports

The printed Pay Slip of Mr. Vijay Kumar is displayed as shown:

Figure 10.8 Printed Pay Slip

172
Payroll Reports

Emailing Pay Slip

Figure 10.9 Mailing Pay Slip sub screen

□ In the Mailing Pay Slip screen,

173
Payroll Reports

The completed Mailing Pay Slip configuration screen is displayed as shown:

Figure 10.10 Completed Mailing Pay Slip sub screen

174
Payroll Reports

Mailing Pay Slip Configurations

□ Press Enter to Email the Pay Slip

175
Payroll Reports

The Pay Slip sent by e-mail when viewed from the mail box of the employee is as shown:

Figure 10.11 Emailed Pay Slip

Exporting Pay Slip to MS Excel

176
Payroll Reports

The completed Export screen is displayed as shown:

Figure 10.12 Export Pay Slip screen

The Pay Slip exported into Excel will appear as shown:

Figure 10.13 Exported Pay Slip

The Pay Slip can also be exported to pdf, jpeg or other formats as per the requirement.

Multi Pay Slips

177
Payroll Reports

E-mail IDs
To check the E-Mail IDs entered,
Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip > E-
Mail IDs

Figure 10.14 E-Mail IDs - Exceptions Only

178
Payroll Reports

The E-Mail IDs report for all the Employees is as shown:

Figure 10.15 E-Mail IDs for All Employees

ail/Print/Export Multi Pay Slips

To E-Mail/Print/Export all the Pay Slips or selected Pay Slips,

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip >
Multi Pay Slips

179
Payroll Reports

□ Select the appropriate Employee Category and Employee Group in the Employee FIlters
subscreen as shown:

Figure 10.16 Employee Filters

□ Press Enter to view the Multi Pay Slip report as shown:

Figure 10.17 Multi Pay Slip screen

180
Payroll Reports

To E-Mail/Print/Export Pay Slips for selective Employees, you have to select

the required Employees using the Space bar.
If the cursor is on a particular Category or a Group, then the Pay Slips
belonging to that Category or Group only will be E-Mailed/Printed/
Exported.

Figure 10.18 Employee Filters

□ Press Enter to display the Pay Sheet

181
Payroll Reports

The Pay Sheet is displayed as shown:

Figure 10.19 Pay Sheet

Figure 10.20 F12: Configuration

182
Payroll Reports

The F12:Configuration options in the Pay Sheet are explained as follows.

183
Payroll Reports

□ Set the F12: Configuration screen is displayed as shown:

Figure 10.21 F12: Configuration screen - Pay Sheet

The Pay Sheet with the above configurations will appear as shown:

Figure 10.22 Pay Sheet

184
Payroll Reports

Figure 10.23 Pay Sheet with Category and Group Total

To view the Pay Sheet for a particular Employee Group,

185
Payroll Reports

The Employee Filters screen is displayed as shown:

Figure 10.24 Employee Filters

186
Payroll Reports

The Pay Sheet for the selected Employee Group is displayed as shown:

Figure 10.25 Employee Group Pay Sheet

You can also drill down from the above report to the voucher level, by highlighting the pay heads
column of the required employee and pressing Enter.

You can also print the Pay Sheet, by pressing Alt+P and specifying the required options in the
Pay Sheet Print configuration screen.

187
Payroll Reports

The Pay Sheet Print Configuration screen is displayed as shown:

Figure 10.26 Pay Sheet Print Configuration screen

188
Payroll Reports

The Printed Pay Sheet is displayed as shown:

Figure 10.27 Printed Pay Sheet (Landscape view)

189
Payroll Reports

□ Press Alt+P to print Pay Sheet and set the Increase Line Height for Signature/ Stamp?
field to Yes
The printed Pay Sheet with space for signature/ stamp is as shown.

Figure 10.28 Printed Pay Sheet with space for Signature/ Stamp

190
Payroll Reports

Page 2 of the Printed Pay Sheet is as shown:

Figure 10.29 Printed Pay Sheet with space for Signature/ Stamp – Page 2

191
Payroll Reports

Payroll Statement
A Payroll Statement is a columnar report which displays Group/Department-wise employees’
break-up of selected earnings or deductions, for a specified month or period.

Figure 10.30 Payroll Statement

192
Payroll Reports

Figure 10.31 F12: Configuration

The F12: Configuration options in Payroll Statement Report are as follows:

193
Payroll Reports

□ Show Employee PF Account Number – Set this option to Yes, to dis-

The Employee PF Account Number, IT PAN Number, ESI Number, Passport

Details, Visa Expiry Date options will be available in F12: Configure only
when the options, Show Statutory details and Passport & Visa details, are
set to Yes in F12: Payroll Configuration.

194
Payroll Reports

The Payroll Statement with the above Configurations is displayed as shown:

Figure 10.32 Payroll Statement with additional information

□ You can also Email or Export Payroll Statement in the manner as dis-
cussed in Pay Slip Section.
□ The Button Bar options in Payroll Statement are same as in the Pay-
sheet report.

195
Payroll Reports

The Payroll statement with additional Pay Heads will be displayed as shown:

Figure 10.33 Payroll Statement with additional Columns

As discussed earlier, the contents of the Payment Advice can be altered in F12: Payroll Configu-
ration as per the employer’s requirements.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Payment
Advice

196
Payroll Reports

The Printing Configuration for Payment Advice is displayed as shown:

Figure 10.34 Printing Configuration for Payment Advice

□ Press Backspace and enter the details as shown above

□ Press Enter to print

197
Payroll Reports

The printed Payment Advice for May 2009 will appear as shown:

Figure 10.35 Printed Payment Advice

198
Payroll Reports

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Payroll
Register
The Payroll Register is displayed as shown:

Figure 10.36 Payroll Register

□ Press F12: Configure and set the Appearance of Names and the Periodicity to use as
shown.

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Payroll Reports

The F12: Configuration screen is displayed as shown:

Figure 10.37 F12: Configuration

The Payroll Register with the above configurations is displayed as shown:

Figure 10.38 Payroll Register - Quarterly

Tally.ERP 9 allows you to drill down to the voucher level from the above display for any kind of
verification. Use the Enter key on the required month/period to drill down to the required level.

200
Payroll Reports

The Payroll Register voucher level screen is displayed as shown:

Figure 10.39 Payroll Voucher Register

You can further drill down to the transaction level, by selecting the required transaction and
pressing Enter.

Employee Pay Head Breakup

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Employee Pay
Head Breakup

□ Select the required Pay Head from the List of Pay Heads and press Enter

201
Payroll Reports

The Employee Breakup of Pay Head for Basic pay screen is displayed as shown:

Figure 10.40 Employee Breakup of Pay Head

To drill down to Employee Summary report from the above display,

□ Select Employee Category and press Enter
□ Press Alt+F1 to view the detailed report

202
Payroll Reports

The Employee Summary screen is displayed as shown:

Figure 10.41 Employee Summary

You can also Email or Export Employee Breakup of Pay Head Report in
the manner as discussed in Pay Slip Section.

To drill down to the Employee Monthly Summary report from the Employee Summary report,
□ Highlight the required employee and press Enter

203
Payroll Reports

The Employee Monthly Summary screen is displayed as shown:

Figure 10.42 Employee Monthly Summary

To further drill down to Employee Voucher level screen from the Employee Monthly Summary
report, press Enter on the required month.

204
Payroll Reports

The Employee Summary voucher level screen is displayed as shown:

Figure 10.43 Employee Vouchers Summary

You can further drill down to the transaction level, by selecting the required transaction and
pressing Enter.

The Employee Breakup of Pay Head report can be viewed with additional Pay Heads, by
pressing Alt+C and adding the required Pay Head and by pressing Alt+N for multiple periods.

Pay Head Employee Breakup

A Pay Head Employee Breakup report displays the sum of transactions and closing balance of
the transacted groups for the selected employee.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Pay Head
Employee Breakup

205
Payroll Reports

The Employee Selection screen is displayed as shown:

Figure 10.44 Employee Selection

To view the Pay Head breakup,

□ Select the required Employee from the List of Employees and press Enter
□ Press Alt+F1 for a detailed view

206
Payroll Reports

The ledger-wise Breakup of Employee screen is displayed as shown:

Figure 10.45 Pay Head Employee Breakup

To further drill down to view the Breakup of Employee report for each ledger from the above
displayed report, select the required ledger and press Enter.

207
Payroll Reports

The Breakup of Employee screen for a selected ledger (Basic Pay) is displayed as shown:

Figure 10.46 Ledger Monthly Summary

You can drill down further to view the Monthly Summary of the selected ledger and the Employee
Voucher report.

The Pay Head Employee Breakup report can be viewed with additional employees, by pressing
Alt+C and adding the required Employee and for multiple periods, by pressing Alt+N.

Go to Gateway of Tally > Display > Payroll Reports > Attendance Sheet

208
Payroll Reports

The Attendance Sheet is displayed as shown:

Figure 10.47 Attendance Sheet

You may configure the above report with additional details, by pressing F12:Configure and
enabling the following options, as required.
The completed F12: Configuration screen is displayed as shown:

Figure 10.48 F12: Configuration screen

209
Payroll Reports

F12: Configurations for Attendance Sheet:

210
Payroll Reports

The Attendance Sheet with the above Configurations is displayed as shown:

Figure 10.49 Attendance sheet

Go to Gateway of Tally > Display > Payroll Reports > Attendance Register

211
Payroll Reports

The Attendance Register is displayed as shown:

Figure 10.50 Attendance Register

□ Press F12: Configure and set the Appearance of Names and the Periodicity to use as
shown
The F12:Configuration options in Attendance Register are as displayed below:

Figure 10.51 F12: Configuration for Attendance Register

Tally.ERP 9 allows you to drill down to the voucher register, from the Attendance Register screen
for any kind of verification.

212
Payroll Reports

The Voucher level screen from Attendance Register is displayed as shown:

Figure 10.52 Attendance Voucher Register

You may further drill down to voucher level, by pressing Enter on the required transaction.

Passport Expiry Report

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Passport Expiry

213
Payroll Reports

The Passport Expiry Report is displayed as shown:

Figure 10.53 Passport Expiry Report

□ Press F12: Configure to configure additional options

The F12: Configuration screen is displayed as shown:

Figure 10.54 F12: Configuration screen

214
Payroll Reports

Button options in Passport Expiry Report:

Visa Expiry Report

The Visa Expiry Report provides information on the visa details of employees i.e., visa number,
visa Expiry date and other details such as the employee's date of joining and email id.

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Visa Expiry

215
Payroll Reports

The Visa Expiry Report is displayed as shown:

Figure 10.55 Visa Expiry Report

The F12: Configuration and Button Options are the same as shown in
Passport Expiry Report.

216
Payroll Reports

Contract Expiry Report

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Contract Expiry

The Contract Expiry Report is displayed as shown:

Figure 10.56 Contract Expiry Report

The F12: Configuration and Button Options are the same as shown in
Passport Expiry Report.

217
Payroll Reports

Payroll Statutory Reports

Figure 10.57 Payroll Statutory Reports in Tally.ERP 9

218
Payroll Reports

Provident Fund Reports

In this section, we will generate each of the above mentioned forms / report and understand the
purpose and information to be furnished.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Computation
□ Press F2 and specify the period as 01-07-2009 to 31-07-2009 and press Enter

219
Payroll Reports

The Payroll Statutory Computation Report is displayed as shown:

Figure 10.58 Payroll Statutory Computation Report

□ Press Enter

Figure 10.59 F12: Configurations screen

220
Payroll Reports

The PF Computation report will is displayed as shown:

Figure 10.60 PF Computation screen

To view detailed ledger wise information under each contributions / deductions head, press
Alt+F1.

221
Payroll Reports

The detailed Provident Fund Computation Report is displayed as shown:

Figure 10.61 Detailed PF Computation Report

You can further drill down to Employee Breakup of Pay Head report and from there to Employee
Vouchers and so on, by pressing Enter on the required ledger from the above screen.

222
Payroll Reports

□ Select Account Number as the Sorting Method

□ Specify 30-06-2009 in the Date field
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.62 Payroll Statutory Print Configuration screen

□ Press Enter to print.

223
Payroll Reports

The printed PF Form 5 is displayed as shown:

Figure 10.63 PF Form 5

In our case study, there are two new employees who have joined during the month of June 2009
and thus Form 5 contains the details of these employees.

224
Payroll Reports

Figure 10.64 Payroll Statutory Print Configuration screen

□ Press Enter to print

225
Payroll Reports

The printed Form 10 is displayed as shown:

Figure 10.65 Printed Form 10

226
Payroll Reports

iv. Form 12A

Figure 10.66 Completed Print Configuration screen

□ Press Enter to print

227
Payroll Reports

The printed Form 12A is displayed as shown:

Figure 10.67 Printed Form 12A

228
Payroll Reports

Figure 10.68 Print Configuration screen

□ Press Enter to Print.

229
Payroll Reports

The printed PF Monthly Statement for August 2009 is displayed as shown:

Figure 10.69 PF Monthly Statement

230
Payroll Reports

Form 3A is a annual contribution card to be furnished for each employee in separate sheets to
EPFO. To print Form 3A, follow the steps given below:

Figure 10.70 Payroll Statutory Print Configuration

□ Press Enter to Print.

231
Payroll Reports

The printed Form 3A for Ajay is displayed as shown:

Figure 10.71 Printed PF Form 3A

The next page will contain the Contribution Card in Form 3A for the next employee.

232
Payroll Reports

Figure 10.72 Payroll Statutory Print Configuration for PF Form 6A

□ Press Enter to Print.

233
Payroll Reports

The printed Form 6A is displayed as shown:

Figure 10.73 Printed Form 6A - Page 1

234
Payroll Reports

The Page 2 of PF Form 6A is displayed as shown:

Figure 10.74 Printed Form 6A - Page 2

235
Payroll Reports

viii. E-Return for PF Form 3A

Tally.ERP 9 also allows to generate the PF Form 3A in dbf fomat. The dbf format of this form can
be copied to a CD and submitted to the PF department.
To generate the PF Form 3A in dbf format,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
E-Return
□ Press Backspace and specify the details as shown:

Figure 10.75 Exporting Form 3A in dbf format

□ Press Enter to Export the form in the required format.

Employee’s State Insurance Reports

236
Payroll Reports

i. ESI Computation Report

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Computation
□ Press F2 and specify the period as 01-07-2009 to 31-07-2009 and press Enter

Figure 10.76 Payroll Computation report

□ Press Enter

Figure 10.77 F12: Configuration screen

237
Payroll Reports

The ESI Computation report is displayed as shown:

Figure 10.78 ESI Computation report

To view the detailed ledger wise information under each contributions / deductions head, press
Alt+F1.

238
Payroll Reports

The detailed Employee State Insurance Computation Report is displayed as shown:

Figure 10.79 Detailed ESI Computation report

You can further drill down to Employee Breakup of Pay Head report and from there to Employee
Vouchers and so on, by pressing Enter on the required ledger from the above screen.

ii. ESI Form 3

239
Payroll Reports

□ Type the Designation details of the person submitting the declaration form
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.80 Payroll Statutory Print Configuration for ESI Form 3

□ Press Enter to Print.

240
Payroll Reports

The printed Form 3 (Return of Declaration) is displayed as shown:

Figure 10.81 Printed Form 3

241
Payroll Reports

iii. ESI Monthly Statement

The completed Payroll Configuration Print screen is displayed as shown:

Figure 10.82 Payroll Statutory Print Configuration screen

□ Press Enter to Print.

242
Payroll Reports

The printed ESI Monthly Statement for August 2009 is displayed as shown:

Figure 10.83 ESI Monthly Statement

243
Payroll Reports

The completed Payroll Statutory Print Configuration screen for ESI Monthly Statement is
displayed as shown:

Figure 10.84 Payroll Statutory Print Configuration screen

244
Payroll Reports

□ Press Enter to Print

The printed From 5 is displayed as shown:

Figure 10.85 Printed Form 5 - Page 1

245
Payroll Reports

The Page 2 of Form 5 (includes the CA Form also) is displayed as shown:

Figure 10.86 Printed Form 5 - Page 2

246
Payroll Reports

The Page 3 of Form 5 is displayed as shown:

Figure 10.87 ESI Form 5 - Page 3

247
Payroll Reports

In the Payroll Statutory Print Configuration screen

Figure 10.88 Payroll Statutory Print Configuration for ESI Form 6

□ Press Enter to Print.

248
Payroll Reports

The printed Form 6 is displayed as shown:

Figure 10.89 Printed Form 6 - Page 1

249
Payroll Reports

The Page 2 of Form 6 is displayed as shown:

Figure 10.90 Printed Form 6 - Page 2

250
Payroll Reports

The Page 3 of Form 6 is displayed as shown:

Figure 10.91 Printed Form 6 - Page 3

251
Payroll Reports

Professional Tax Reports

i. Professional Tax Computation Report

252
Payroll Reports

The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.92 Payroll Statutory Print Configuration screen

■ Press Enter to Print.

253
Payroll Reports

The printed Professional Tax Computation report for the month of August 2009 will appear as
shown:

Figure 10.93 Printed PT Computation Report

254
Payroll Reports

ii. Professional Tax Statement

Figure 10.94 Payroll Statutory Print Configuration screen

□ Press Enter to Print.

255
Payroll Reports

The printed Professional Tax Statement for August 2009 is displayed as shown:

Figure 10.95 Printed Professional Tax Statement

256
Payroll Reports

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Gratuity Report

257
Payroll Reports

The Gratuity Report for the Employees eligible for Gratuity is displayed as shown:

Figure 10.96 Gratuity Summary Report

The above report displays the Gratuity Amount computed for each month for each Employee.

In order to ascertain the Gratuity payable amount, set Use for Gratuity to
Yes in the Pay Head master (i.e. Basic Pay, Dearness Allowance etc.)

258
Payroll Reports

Button Options in the Gratuity Report:

The above report displays the details of all employees along with the Date of Birth, Date of Joining
and the Gratuity Eligible Salary, besides commenting on the total Gratuity liability as on date.

Press F12: Configure to configure for additional options

Figure 10.97 F12: Configuration screen

Tally.ERP 9 allows you to drill down to the Gratuity Details report from the above display.
□ Select the required employee and press Enter

259
Payroll Reports

The Gratuity Details screen is displayed as shown:

Figure 10.98 Gratuity Details Report

The above report displays the detailed Gratuity computation for all the slabs entered during the
Gratuity Pay Head Creation.

© 2009 Tally Solutions Pvt. Ltd. All rights reserved.

Version: Implementation of Payroll in Tally.ERP 9/1.8/June 2010

Contents

Introduction ............................................................................................................................................................................... 1

Lesson 1: Configuring Payroll in Tally.ERP 9

Lesson 2: Creation of Payroll Masters

Lesson 3: Processing Payroll in Tally.ERP 9

Lesson 4: Accounting for Employer PF Contributions

Lesson 5: Accounting for Employer ESI Contributions

i
Contents

Lesson 6: Payment of Professional Tax

6.1 Processing of Professional Tax Payment ................................................................................................ 128

Lesson 7: Tracking of Salary Advances / Loans

Lesson 8: Accounting for Pay Revision & Arrears

Lesson 9: Processing Payroll for Contract Employees

Lesson 10: Payroll Reports

ii
Introduction

Lesson Objectives
On completion of this lesson, you will have learnt:

□ The features of Payroll in Tally.ERP 9

□ How to enable Payroll in Tally.ERP 9

Payroll in Tally.ERP 9 is easy to use and can handle all the functional, accounting and statutory
requirements of the payroll department.

Salient Features of Payroll in Tally.ERP 9

Enabling Payroll in Tally.ERP 9

In Tally.ERP 9 activation of Payroll requires a one time simple setup. Create a new company in
Tally.ERP 9 and follow the steps given below to enable Payroll.

Case Study Company

M/s. Spectrum Software Solutions is engaged in the Software services Business. It is a
Bangalore-based company with the following three major departments:
□ Sales
□ Administration
□ R&D

Step 1: Company Setup

Figure 1.1 Company Creation screen

□ Press Enter to Accept the completed Company Creation screen

Step 2: Enable Payroll

The completed F11: Accounting Features screen is displayed as shown:

Figure 1.2 F11: Accounting Features screen

□ Press Enter to Accept the F11: Accounting Features screen

Once the Payroll feature is activated in Tally.ERP 9, the following two new options get activated in
the F11: Statutory & Taxation Master

Step 3: Enable Payroll Statutory Features

Go to Gateway of Tally > press F11: Company Features > press F3: Statutory & Taxation
In F11: Statutory & Taxation Features screen:
□ Set Enable Payroll Statutory to Yes

5
Configuring Payroll in Tally.ERP 9

□ Set Set/Alter Payroll Statutory Details to Yes

Figure 1.3 F11: Statutory & Taxation Features screen

□ Press Enter

In the Payroll Statutory Details screen:

□ Enter the Provident Fund & Employee State Insurance details of the company as
shown:

Figure 1.4 Payroll Statutory Details screen

6
Configuring Payroll in Tally.ERP 9

□ Press Enter to Accept the screen and go back to F11: Statutory & Taxation Features
screen
□ Press Ctrl+A to Accept the screen.

7
Lesson 2: Creation of Payroll Masters

Lesson Objectives
On completion of this lesson, you will have learnt how to:

□ Create Payroll Masters in Tally.ERP 9

7
Creation of Payroll Masters

The Payroll feature in Tally.ERP 9 requires minimal effort for accurate payroll processing. It takes
five easy steps to process payroll & generate Pay Slip in Tally.ERP 9.

Figure 2.1 Payroll Cycle

8
Creation of Payroll Masters

□ Salary Details

Tally.ERP 9 provides the flexibility to create the Employees and Group them under specific
Employee Group which in turn can be created under specific Employee Categories.

The following masters can be created in Tally.ERP 9 to successfully record the Employee Details:
□ Employee Category
□ Employee Groups
□ Employees

The Employee Category will provide an additional level to classify the

Employees in a logical manner. In the case study, in this book all the
Employee Groups are created under Primary Cost Category, hence creation
of an additional Category is not shown.

To create Sales as an Employee Group:

9
Creation of Payroll Masters

The Employee Group Creation screen is displayed as shown:

Figure 2.2 Employee Group Creation screen

4. Press Enter to Accept the Employee Group Creation screen

Similarly, create the other Employee Groups such as Administration and R&D.

10
Creation of Payroll Masters

The F12: Payroll Configuration screen is displayed as shown:

Figure 2.3 F12: Payroll Configuration screen

□ Press Enter to Accept

Create the following Employee Masters:

11
Creation of Payroll Masters

4. Specify the Date of Joining as 01-04-2009

5. Type the other details of the employee as shown:

Figure 2.4 Employee Creation screen

6. Press Enter to Accept the screen

The option Date of Leaving and Reason for Leaving will be available only in
the Alteration mode.

Similarly, create the Employee Masters for other employees with their respective departments.

12
Creation of Payroll Masters

i. Simple Payroll Units

The completed Unit Creation screen is displayed as shown:

Figure 2.5 Simple Unit Creation screen

5. Press Enter to Accept the Unit Creation screen.

Similarly, create Minutes as another Simple Unit.

ii. Compound Payroll Units

Create Hrs of 60 Mins as a Compound Unit.
In the Unit Creation screen:
1. Press Backspace and select Compound as the Type of Unit
2. Specify Hrs as the First Unit
3. Enter 60 as the Conversion

13
Creation of Payroll Masters

4. Specify Mins as the Second Unit

Figure 2.6 Compound Unit Creation screen

5. Press Enter to Accept the Unit Creation screen.

Attendance/ Production Types

i. Present Attendance Type

14
Creation of Payroll Masters

3. Select Attendance/ Leave with Pay as the Attendance Type and the Period Type appears
as Days, by default.

Figure 2.7 Attendance/ Production Type Creation screen

The completed Attendance Type Creation screen is displayed as shown:

Figure 2.8 Attendance/Production Type Creation Screen

4. Press Enter to Accept the Attendance Type Creation screen.

Figure 2.9 Attendance/ Production Type Creation screen

□ Press Enter to Accept the Attendance Type Creation screen.

15
Creation of Payroll Masters

In the same way, create Overtime as the Production Type with Production as the Attendance
Type.

iii. Overtime Production Type

The completed Overtime - Production Type Creation screen is displayed as shown below:

Figure 2.10 Overtime - Production Type Creation screen

□ Press Enter to Accept the Production Type Creation screen.

Attendance/Production Types details:

□ Present Attendance Type may be used when the pay value is

In Tally.ERP 9, each pay head is to be created as an individual ledger account and grouped under
its respective group i.e., all Earnings pay heads under Indirect Expenses group or Direct

16
Creation of Payroll Masters

Expenses group and all Deductions pay heads under Current Liabilities, Current Assets and
Duties & Taxes group.

The preset Pay Head types in Tally.ERP 9 are:

Create the following pay heads in the books of M/s. Spectrum Software Solutions.

Earning Pay Heads

i. Basic Pay Head Creation

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
In the Pay Heads Creation screen,

17
Creation of Payroll Masters

1. Type Basic Pay as the Name of the Pay Head

2. Select Earnings for Employees in the field Pay Head Type.

The Pay Head Creation screen is displayed as shown:

Figure 2.11 Basic Pay Head Creation – Pay Head Type Selection

Description of general parameters in Pay Head creation:

18
Creation of Payroll Masters

The Pay Head Creation screen with the List of Calculation is displayed as shown:

Figure 2.12 Basic Pay Head Creation - Calculation Type

Calculation Type refers to the method of computation of pay components. In

Tally.ERP 9, there are basically 5 calculation types.

8. Select Present in the field Attendance/ Leave with Pay.

19
Creation of Payroll Masters

The Pay Head Creation screen with the List of Attendance Types is displayed as shown below:

Figure 2.13 Pay Head Creation screen with List of Attendance Types

9. Select Months in Calculation period field and press Enter

20
Creation of Payroll Masters

The Pay Head Creation screen with the List of Calculation Periods is displayed as shown:

Figure 2.14 Pay Head Creation - Calculation Period selection

Tally.ERP 9 contains four predefined Calculation periods – Days, Fortnights,

Months and Weeks.

21
Creation of Payroll Masters

10. Select User defined in the Per Day Calculation Basis field

Figure 2.15 Pay Head Creation screen - Calculation Basis Selection

11. Press Enter to Accept

Calculation Basis refers to the periodicity of the given calculation period.

22
Creation of Payroll Masters

12. Specify the Months of 26 Days and press Enter

Figure 2.16 Pay Head Creation screen - Calculation period

13. Select Normal Rounding as the Rounding Method and press Enter.

Figure 2.17 Pay Head Creation screen – Rounding Method selection

23
Creation of Payroll Masters

14. Specify 1 as the rounding Limit (The Rounding limit allows the value to be in multiples of the
limit specified and is based on the Rounding Method selected)

There are 4 methods of Rounding Off in Tally.ERP 9 which are as follows:

□ Not Applicable – The decimal points will be taken into consideration,

The completed Basic Pay Head Creation screen is displayed as shown:

Figure 2.18 Completed Basic Pay Head Creation screen

15. Press Enter to Accept the screen.

24
Creation of Payroll Masters

ii. House Rent Allowance Pay Head Creation

Figure 2.19 HRA Pay Head Creation screen - Calculation Type selection

8. Select Normal Rounding as the Rounding Method and 1 as the rounding Limit and press
Enter

25
Creation of Payroll Masters

9. In the Computation Info screen, select On Specified Formula in the Compute field

Figure 2.20 Pay Head Creation screen with Compute method

Computation on details:

26
Creation of Payroll Masters

10. Press Enter and the Compute subscreen is displayed

11. In the Sub-screen Compute:
■ Select Basic Pay as the Add Pay Head function and press Enter

Figure 2.21 Compute sub-screen

27
Creation of Payroll Masters

■ Select End of List

Figure 2.22 Compute: On Specified Formula sub-screen

■ Press Enter to Accept the screen

28
Creation of Payroll Masters

14. Select Percentage as the Slab Type from the List of Slabs

Figure 2.23 Pay Head Creation screen - Slab Type selection

Slab Type Details:

Percentage – This Slab rate is used when the amount is stated as a propor-
tion of a whole.
Value – This Slab rate is used when the amount is stated as absolute value.

29
Creation of Payroll Masters

15. Specify 40% in the Value Basis field and press Enter

Figure 2.24 Pay Head Creation - Value Basis screen

The completed House Rent Allowance (HRA) Pay Head Creation screen is displayed as
shown.

Figure 2.25 Completed HRA Pay Head Creation screen

16. Press Enter to Accept the screen

30
Creation of Payroll Masters

iii. Conveyance Pay Head Creation

Create the Conveyance Pay Head with Calculation Type as Flat Rate.
The completed Conveyance Pay Head Creation screen is displayed as shown:

Figure 2.26 Conveyance Pay Head Creation

□ Press Enter to Accept the screen

31
Creation of Payroll Masters

iv. Overtime Pay Head Creation

Create the Overtime Pay Head with Calculation Type as Production.

The completed Overtime Pay Head Creation screen is displayed as shown:

Figure 2.27 Overtime Pay Head Creation screen

□ Press Enter to Accept the screen

32
Creation of Payroll Masters

v. Variable Pay Head Creation

Similarly, create the Variable Pay Head with Calculation Type as User Defined Value.

Figure 2.28 Variable Pay Head Creation

Deduction Pay Heads

Create the following Deduction Pay Heads.

33
Creation of Payroll Masters

i. Employee’s PF Contribution @ 12% Pay Head Creation

Figure 2.29 Employees' PF Contribution @ 12% Pay Head Creation

34
Creation of Payroll Masters

3. Select PF Account (A/c No. 1) in the Statutory Pay Type field as shown:

Figure 2.30 Employees' PF Contribution @ 12% Statutory Pay Type selection

35
Creation of Payroll Masters

10. In the Compute sub-screen, select Basic Pay as the Add Pay Head function and press
Enter

Figure 2.31 Deduction Pay Head Creation screen – Compute On selection

11. Press Enter to Accept the screen

12. Specify 1-4-2008 as the Effective From date
13. The column From Amount is automatically skipped, with the assumption that the amount is
zero

36
Creation of Payroll Masters

14. Specify 6500 in the Amount Upto column and press Enter

Figure 2.32 Deduction Pay Head Creation – Computation Info.

37
Creation of Payroll Masters

18. Specify Rs. 780 in the Value Basis field and then press Enter

Figure 2.33 Deduction Pay Head Creation screen with Value Basis

19. Press Enter twice

38
Creation of Payroll Masters

The completed Employee’s PF Contribution @ 12% Pay Head Creation screen is displayed as
shown:

Figure 2.34 Completed Employee’s PF @ 12% Pay Head Creation screen

20. Press Enter to Accept the screen.

ii. Employee’s ESI Contribution @ 1.75% Pay Head Creation

Create Employee’s State Insurance (ESI) Pay Head as discussed.

39
Creation of Payroll Masters

9. Select On Specified Formula in the field Compute and press Enter

Figure 2.35 Employee's ESI Pay Head creation screen - Compute On Selection

In the Compute On Sub-screen, subscreen,

■ Select Basic Pay as the Add Pay Head function and press Enter
■ Select House Rent Allowance as the second Pay Head in the Add Pay Head Func-
tion

40
Creation of Payroll Masters

■ Similarly, select Conveyance and Overtime Pay as the Add Pay Head function

Figure 2.36 Employee's ESI Pay Head creation screen - Add Pay Head selection

■ Select End of List and press Enter

Any income of a regular nature will be subject to ESI calculation viz., Basic
Pay, Dearness Allowance, House Rent Allowance, Conveyance, Overtime
etc.,)

10. Specify 1-4-2008 as the Effective From date

41
Creation of Payroll Masters

The Pay Head Creation screen is displayed as shown:

Figure 2.37 Employee's ESI Pay Head creation screen – Slab Rate

42
Creation of Payroll Masters

The completed ESI – Employee’s Contribution Pay Head Creation screen is displayed as
shown:

Figure 2.38 Completed ESI – Employee’s Contribution Pay Head Creation screen

14. Press Enter to Accept the screen.

iii. Professional Tax Pay Head Creation

Create Professional Tax Pay Head with the following Slab rates.

From Amount To Amount Professional Tax

Amount
0 5000 0
5000 8000 60
8000 10000 100
10000 15000 150
15000 - 200

43
Creation of Payroll Masters

The completed Professional Tax Pay Head Creation screen is displayed as shown:

Figure 2.39 Profession Tax Pay Head Creation

□ Press Enter to Accept

Gratuity Pay Head

44
Creation of Payroll Masters

Ledger Pay Head Type Under

Gratuity Expenses (Provisional) Gratuity Provisions (Current
Liabilities)

In the Pay Head Creation screen,

45
Creation of Payroll Masters

The Slab Rate Details for Gratuity calculation screen is displayed as shown:

Figure 2.40 Slab Rate Details for Gratuity Calculation screen

4. Press Enter to Accept the screen

Gratuity parameter details:

46
Creation of Payroll Masters

The completed Gratuity Expenses (Provisional) Pay Head Creation screen is displayed as
shown:

Figure 2.41 Gratuity Expenses Ledger Creation screen

6. Press Enter to Accept the screen.

Salary Details Setup

47
Creation of Payroll Masters

To define Salary Details for employees,

Go to Gateway of Tally > Payroll Info. > Salary Details > Create

Figure 2.42 List of Employee Groups/ Employees screen

48
Creation of Payroll Masters

The Salary Details Creation screen is displayed as shown:

Figure 2.43 Salary Details Creation screen

49
Creation of Payroll Masters

The completed Salary Details Creation screen for Mr. Vijay Kumar is displayed as shown:

Figure 2.44 Completed Salary Details screen

Tally.ERP 9 allows you to modify the pre-defined Slab rates by pressing F12:
Configure and setting the option Allow to Override Slab Percentage to
Yes.

In case a revision in pay structure is required for any subsequent period,

define the latest pay structure by specifying the relevant Effective from date.

50
Creation of Payroll Masters

Salary Details for Ajay can be created similar to the Salary Details creation for Vijay Kumar.

Since Ajay and Mahesh are in Sales Group, we can create the Salary Details for the Group and
inherit the same for the Employees (Ajay and Mahesh) in that Group.

Salary Details creation for the Sales Group

51
Creation of Payroll Masters

The completed Salary structure for the Sales Group is as shown:

Figure 2.45 Completed Salary Details for Sales Group

The Pay structure created above can be inherited for all the employees belonging to Sales Group.
This feature helps in eliminating the repetitions while creating the Salary Details.

52
Creation of Payroll Masters

The Salary Details Creation screen is displayed as shown:

Figure 2.46 Salary details Creation – Copy From Parent Value

Start Type Details:

53
Creation of Payroll Masters

The Salary Details Configuration screen is displayed as shown:

Figure 2.47 Salary Details Configuration

■ Press Enter to Accept

6. Now, you will be able to enter the user-defined pay rates to compute the HRA, specify 20% and
press Enter

In the Salary Details Configuration screen, when the option Allow to

Override Slab Percentage is set to Yes, the predefined slab rates for the
Pay Heads can be modified as per user requirements.

54
Creation of Payroll Masters

The completed Salary Details screen of Mr. Ajay is displayed as shown:

Figure 2.48 Completed Salary Details screen

7. Press Enter to Accept the screen.

Similarly, you can create the Salary Details for Mahesh and others employees.

55
Lesson 3: Processing Payroll in Tally.ERP 9

Lesson Objectives
On completion of this lesson, you will have learnt

□ To process Payroll in Tally.ERP 9

Typically, Payroll Processing comprises of the following activities:

□ Recording of Attendance and Production details (on time / work)
□ Processing Payroll Vouchers
□ Payment of Salaries

There are three types of Payroll Vouchers namely Attendance Voucher, Payroll Voucher and
Payment Voucher, which are by default preset in Tally.ERP 9 to record above Payroll transac-
tions.

56
Processing Payroll in Tally.ERP 9

Go to Gateway of Tally > Payroll Vouchers

1. Press Ctrl+F5 for Attendance Voucher
The Attendance Voucher Creation screen is displayed as shown:

Figure 3.1 Attendance Voucher Creation screen

2. Press F2 and specify the date as 30-4-2009

3. Press Enter
4. Press Alt+A (Attendance Auto Fill) to prefill employee payroll details

57
Processing Payroll in Tally.ERP 9

The Attendance Auto Fill screen is displayed as shown:

Figure 3.2 Attendance Auto Fill screen

In the Attendance Auto Fill screen,

Figure 3.3 Attendance Auto Fill - Employee Category selection

■ Select All Items as Employee/ Group (if you want to generate payroll voucher for indi-
vidual employee/ group, select the respective employee or group)

58
Processing Payroll in Tally.ERP 9

The Attendance Auto Fill with Employee Filters screen is displayed as shown:

Figure 3.4 Attendance Auto Fill with Employee List

■ Select Present as Attendance Type in the Attendance/ Production Type field

Figure 3.5 Attendance Auto Fill with List of Attendance Type

■ Specify the require value that should be prefilled for all Employees e.g. 26
■ Press Enter to accept the screen

59
Processing Payroll in Tally.ERP 9

Separate Attendance vouchers are required for recording attendance on

5. Employees pertaining to the respective Employee Groups are displayed automatically

Figure 3.6 Attendance Voucher

6. Alter the attendance details as given in the table above

60
Processing Payroll in Tally.ERP 9

The Attendance Voucher Creation screen with the attendance details screen is displayed as
shown:

Figure 3.7 Attendance Voucher

7. Press Enter
8. Enter the details of the transaction in the Narration field

61
Processing Payroll in Tally.ERP 9

The completed Attendance Voucher Creation for Present Attendance is displayed as shown:

Figure 3.8 Completed Attendance Voucher Screen

9. Press Enter to accept the completed Attendance Voucher screen.

In the same way, create an Attendance Voucher for Overtime Hours.

62
Processing Payroll in Tally.ERP 9

The completed Attendance Voucher for Overtime Hours is displayed as shown:

Figure 3.9 Attendance Voucher Screen - Overtime

□ Press Enter to accept.

You can also record Overtime in hours, provided the Unit of Measurement for
the Payroll unit is defined as Hrs.

After creating the Attendance Voucher, you can change any attendance value for a particular
employee, if required, in the Voucher Alteration mode.

63
Processing Payroll in Tally.ERP 9

Payroll Vouchers
A payroll voucher is used to record all employee-related transactions. It enables you to compute
all the values for the respective Pay Heads (Earnings and Deductions).

Cash Remittance

Example 2:
On 30th April, 2009, M/s. Spectrum Solutions processes Payroll for all the employees and
entitled the following employees for Variable Pay.

Particulars Vijay Kumar Rahul Mahesh Ajay

Variable Pay 1500 - 1000 -

Go to Gateway of Tally > Payroll Vouchers

Figure 3.10 Payroll Autofill with Process List

64
Processing Payroll in Tally.ERP 9

In Tally.ERP 9, the following processes are preset for faster processing of

■ Specify 1-4-2009 in the From field

■ Specify 30-4-2009 in the To field
■ Select All Items as Employee/Group

Figure 3.11 Payroll Autofill with List of Employees

■ Select Cash in the Payroll Ledger field

65
Processing Payroll in Tally.ERP 9

The completed Payroll Auto Fill screen is displayed as shown:

Figure 3.12 Payroll Autofill with payment Ledger list

■ Press Enter to accept the screen (the Cash ledger is prefilled in the Account field)

All the pay values are calculated for the applicable pay heads for each employee grouped under
the selected group.

66
Processing Payroll in Tally.ERP 9

The Payroll Voucher Creation screen is displayed as shown:

Figure 3.13 Payroll Voucher Creation

4. Press Enter and specify the pay values for the pay heads defined as user-definable values
against each employee (in this case, define the Variable Pay)

67
Processing Payroll in Tally.ERP 9

■ Specify 1000 as Variable Pay for Mahesh

Figure 3.14 Payroll Voucher - adding Variable pay

■ Similarly, specify 1500 as Variable Pay for Vijay Kumar and press Enter

68
Processing Payroll in Tally.ERP 9

The completed Payroll Voucher Creation screen is displayed as shown:

Figure 3.15 Completed Payroll Voucher

5. Press Enter to accept.

Example 3:
On 31st May, 2009 M/s. Spectrum Solutions disbursed Salaries payable for the month of
May 2009 through Bank Transfer. The attendance records displayed the following details:

69
Processing Payroll in Tally.ERP 9

Attendance/Production Vijay Kumar Rahul Mahesh Ajay

Types
Present Days 25 20 26 21
Overtime Hours - 120 Min
(2hr x 60min)

Step 1: Create Attendance Voucher

Create Attendance Vouchers for Present days and Overtime hours for May 2009 as per the
details given in the above table.

The completed Attendance Voucher for Present days is displayed as shown:

Figure 3.16 Attendance Voucher for Present days

□ Press Enter to accept

70
Processing Payroll in Tally.ERP 9

In the same way, create an Attendance Voucher for Overtime Hours.

The completed Attendance Voucher for Overtime Hours is displayed as shown:

Figure 3.17 Attendance Voucher for Overtime Hours

□ Press Enter to accept.

Step 2: Create Salary Payable Ledger

Before passing the Salary payment voucher, create the following ledger:
Ledger Pay Head Type Under
Salary Payable Not Applicable Current Liabilities

71
Processing Payroll in Tally.ERP 9

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
The completed Salary Payable Ledger creation screen is displayed as shown:

Figure 3.18 Salary Payable Ledger Creation

□ Press Enter to accept

Step 3: Create Payroll Voucher

Figure 3.19 Payroll Autofill with List of Processes

5. Specify 01-05-2009 in the From field

6. Specify 31-05-2009 in the To field

72
Processing Payroll in Tally.ERP 9

7. Select All Items as Employee/Group

8. Select Salary Payable in the Payroll Ledger field as shown

Figure 3.20 Payroll Autofill - Payroll Ledger selection

Figure 3.21 Completed Payroll Voucher

11. Press Enter to accept

73
Processing Payroll in Tally.ERP 9

After passing the above entry, the salaries payable for the month of May 2009 are transferred to
the Salary Payable Ledger, at the time of payment of salaries, the amount is reversed.

Payment of Salaries (Salary Disbursement)

Go to Gateway of Tally > Accounting Vouchers

Figure 3.22 Payment Auto Fill - Payment Process Selection

■ Specify 01-05-2009 as From period

74
Processing Payroll in Tally.ERP 9

The completed Payment Auto Fill screen is displayed as shown:

Figure 3.23 Payment Auto Fill screen

4. Press Enter and the employee payroll details will appear by default.
5. Enter the details of the transactions in the Narration field

The completed Payroll Payment Entry screen is displayed as shown:

Figure 3.24 Payment Voucher

6. Press Enter to accept.

If a partial payment of salaries is made to a particular group of employees, then generate a

separate payroll voucher for their payables and pass a separate payment entry based on the set-
tlement. However, Tally.ERP 9 also allows you to modify the payment amount to the Employees.

75
Processing Payroll in Tally.ERP 9

The unpaid salary will remain as outstanding in the Salary payable account and can be auto-filled
in the payment voucher as and when the actual payments are made.

76
Lesson 4: Accounting for Employer PF
Contributions

Lesson Objectives
On completion of this lesson, you will be able to

□ Process Employer’s Contributions to Provident Fund (PF)

□ Payment of Provident Fund Contributions
□ Generate the PF Combined Challan

77
Accounting for Employer PF Contributions

Once an establishment is covered under PF, all its departments and branches are covered, irre-
spective of where they are located.

i. Employees' Pension Scheme:

Benefits under the Scheme

ii. Employees Deposit Linked Insurance Scheme:

Benefit to nominee of employee

78
Accounting for Employer PF Contributions

Illustration 1:
On 30th April, 2009 M/s. Spectrum Software Solutions processed Provident Fund contribu-
tions for the month of April 2009 and paid the amount in full to EPFO.

The same is accounted as shown:

Creation of Employer PF Contribution Masters

I. Employer Contributions Pay Head

i. Employer Contribution EPS @ 8.33% Pay Head Creation

79
Accounting for Employer PF Contributions

3. In the field Statutory Pay Type, select EPS Account (A/c No. 10) as shown

Figure 4.1 Employer EPS @ 8.33% Pay Head Creation

80
Accounting for Employer PF Contributions

■ Select Basic Pay as the Add Pay Head function from the list of Pay Heads as shown.

Figure 4.2 Compute Subscreen

■ Select End of List

81
Accounting for Employer PF Contributions

The completed Employer EPS @ 8.33% Pay Head Creation screen is displayed as shown:

Figure 4.3 Completed Employer EPS Pay Head Creation Screen

8. Press Enter to accept

ii. Employer Contribution EPF @ 3.67% Pay Head

82
Accounting for Employer PF Contributions

The Pay Head Creation screen is displayed as shown:

Figure 4.4 Employer EPF @ 3.67% Pay Head Creation

83
Accounting for Employer PF Contributions

The Compute sub-screen is displayed as shown:

Figure 4.5 Compute Subscreen

■ Select End of List

84
Accounting for Employer PF Contributions

The completed Employer EPF @ 3.67% Pay Head Creation screen is displayed as shown:

Figure 4.6 Completed Employer EPF Pay Head Creation Screen

9. Press Enter to accept.

Alternatively, you can also define the criteria for computation of Employer PF
Contribution @ 3.67% Pay head, by selecting Basic Pay in the Compute sub-
screen. and defining the percentage as 3.67%.

II. Employer PF Admin Charges

85
Accounting for Employer PF Contributions

i. PF Administrative Charges @ 1.10% Pay Head Creation

Figure 4.7 PF Admin Charges Pay Head creation

86
Accounting for Employer PF Contributions

The completed PF Admin Charges @ 1.10% Pay Head Creation screen is displayed as shown:

Figure 4.8 Completed Pay Head Creation - PF Admin Charges

9. Press Enter to accept

ii. EDLI Contribution @ 0.5% Pay Head Creation

87
Accounting for Employer PF Contributions

3. In Statutory Pay Type filed select EDLI Contribution (A/c No. 21) as shown

Figure 4.9 EDLI Contribution Pay Head Creation

88
Accounting for Employer PF Contributions

The completed EDLI Contribution @ 0.5% Pay Head Creation screen is displayed as shown:

Figure 4.10 Completed Pay Head for EDLI Contribution

7. Press Enter to accept and save the Pay Head

iii. EDLI Administrative Charges @ 0.01% Pay Head Creation

89
Accounting for Employer PF Contributions

The Pay Head Creation screen is displayed as shown:

Figure 4.11 EDLI Admin Charges Pay Head Creation

■ Set Minimum Rs 2/Employee to Yes if you want the EDLI Admin Charges to be mini-
mum Rs. 2.

When the option Minimum Rs 2/Employee is set to Yes, the EDLI Admin
Charges for each employee is minimum Rs. 2 or actual value as calculated.

When this option is set to No the EDLI Admin Charges are calculated as per
the specified formula.

90
Accounting for Employer PF Contributions

The completed EDLI Admin Charges @ 0.01% Pay Head Creation screen is displayed as
shown:

Figure 4.12 Completed pay Head for EDLI Admin Charges

7. Press Enter to accept and save the Pay Head.

III. PF Payable Ledger

To process the Employer PF Contribution, create PF Payable Ledger as explained below:
Ledger Pay Head Type Under
PF Payable Not Applicable Current Liabilities

Go to Gateway of Tally > Payroll Info. > Payheads > Create

1. Type PF Payable in the Name field
2. In the Pay Head Type field select Not Applicable
3. Specify the Group as Current Liabilities in the Under field and press Enter

91
Accounting for Employer PF Contributions

The completed PF Payable Ledger creation screen is displayed as shown:

Figure 4.13 Completed PF Payable Ledger Creation

4. Press Enter to accept.

IV. PF Admin Expenses Ledger

To process the Employer Other Charges (PF Admin, EDLI Contribution and EDLI Admin
expenses), create PF Admin Expenses Ledger as explained below:
Ledger Under
PF Admin Expenses Indirect Expenses

Go to Gateway of Tally > Accounts Info. > Ledgers > Create

1. In the Name field, type PF Admin Expenses
2. Specify the group as Indirect Expenses in the field Under and press Enter

92
Accounting for Employer PF Contributions

The completed PF Admin Expenses Ledger creation screen is displayed as shown:

Figure 4.14 PF Admin Expenses Ledger Creation

3. Press Enter to accept

Salary Details setup

Create / Alter Salary Details Master

93
Accounting for Employer PF Contributions

The completed Salary Details screen is displayed as shown:

Figure 4.15 Salary Details Alteration Screen

94
Accounting for Employer PF Contributions

Processing Employer PF Contribution

Follow the steps explained below to process Provident Fund.

Figure 4.16 Payroll Auto Fill - Process List Selection

95
Accounting for Employer PF Contributions

■ Select PF Payable Ledger from the list of Ledger Accounts drop down in the Payroll
Ledger field as shown

Figure 4.17 Employee Filters screen – Payroll Ledger Selection

The values for the Employer PF contributions are prefilled in the Payroll Voucher for PF Contribu-
tion process.

96
Accounting for Employer PF Contributions

The Payroll Voucher for Employer PF Contribution is displayed as shown:

Figure 4.18 Payroll Voucher Creation - PF Contribution

5. Press Enter to accept

97
Accounting for Employer PF Contributions

The completed Payroll Voucher for Employer PF Contribution is displayed as shown:

Figure 4.19 Completed PF Contribution screen

6. Press Enter to accept.

Processing PF Admin Expenses

98
Accounting for Employer PF Contributions

■ Select PF Admin Expenses Ledger in the Expense Ledger field

Figure 4.20 Employer’s Other Charges screen – Expenses Ledger Selection

99
Accounting for Employer PF Contributions

■ Select PF Admin Charges @ 1.10% Ledger in the Admin Charges (A/c No. 2) field
as shown

Figure 4.21 Employer’s Other Charges screen – Admin Charges Ledger Selection

■ Similarly, select EDLI Contribution @ 0.5% and EDLI Admin Charges @ 0.01% in
the EDLI Contribution (A/c No. 21) and EDLI Admin Charges (A/c No. 22) fields
respectively.

100
Accounting for Employer PF Contributions

The completed Employer’s Other Charges subscreen is displayed as shown:

Figure 4.22 Completed Employer’s Other Charges screen

■ Press Enter
4. Type the details of the transaction in the Narration field

101
Accounting for Employer PF Contributions

The completed Employer PF Expenses Voucher is displayed as shown:

Figure 4.23 Completed PF Expenses Voucher screen

5. Press Enter to accept and save.

Payment of Provident Fund

To process the payment of Provident Fund, follow the steps given below:

Step 1: Create PF Payment Voucher

102
Accounting for Employer PF Contributions

■ Select PF Challan in the Process for field from the Process List screen

Figure 4.24 Employee Filters screen - Process Selection

Figure 4.25 Employee Filters screen - PF Ledger selection

4. Press Enter to prefill PF Payable Amount in respect of Employer Contributions during the
relevant month

103
Accounting for Employer PF Contributions

The Payment voucher is displayed as shown:

Figure 4.26 PF Payment Voucher with Employer PF Contribution details

104
Accounting for Employer PF Contributions

5. Press Enter again, to prefill the amount of Employee Contributions during the relevant
month

Figure 4.27 PF Payment Voucher - with Employee Contribution details

105
Accounting for Employer PF Contributions

6. Press Enter thrice again, to prefill EDLI Admin Expenses, EDLI Contribution and PF Admin
Charges during the selected month as shown:

Figure 4.28 PF Payment Voucher with Employer Other charges details

7. Press Enter twice

Figure 4.29 Payment details subscreen

106
Accounting for Employer PF Contributions

10. Press Enter to go back to the PF Payment Voucher screen

11.Type the details of the transaction in the narration field
The completed PF Payment Voucher screen for the month of April 2009, is displayed as shown:

Figure 4.30 Completed PF Payment Voucher screen

12. Press Enter to accept

Step 2: Print PF Payment Challan
□ Press Pg UP from the Voucher Entry screen shown above
□ Press Alt + P, the Voucher Printing screen is displayed as shown:

Figure 4.31 Voucher Printing Screen

107
Accounting for Employer PF Contributions

Figure 4.32 Printed PF Payment Challan

108
Lesson 5: Accounting for Employer ESI
Contributions

Lesson Objectives
On completion of this lesson, you will be able to

□ Process Employer’s Contribution to Employees’ State Insurance (ESI)

□ Payment of ESI Contributions
□ Generate the ESI payment Challan

109
Accounting for Employer ESI Contributions

The same is accounted as shown:

110
Accounting for Employer ESI Contributions

Creation of Employer ESI Contribution Masters

I. Create Employer ESI Contribution @ 4.75% Pay Head

Go to Gateway of Tally >Payroll Info >Pay Heads >Create

Figure 5.1 Pay Head Creation - Employer ESI

4. Specify the group as Indirect Expenses in the Under field and press Enter

111
Accounting for Employer ESI Contributions

5. Set Affect Net Salary to No and press Enter

Figure 5.2 Employer ESI Pay Head Creation – Compute sub-screen

■ Select End of List and press Enter to accept the screen

112
Accounting for Employer ESI Contributions

Figure 5.3 Employer ESI Pay Head Creation

113
Accounting for Employer ESI Contributions

The completed Employer ESI Contribution Pay Head Creation screen is displayed as shown:

Figure 5.4 Completed Employer ESI Pay Head

□ Press Enter to accept.

II. Create ESI Payable Ledger

Create ESI Payable Ledger as explained below:
Ledger Pay Head Type Under
ESI Payable Not Applicable Current Liabilities

114
Accounting for Employer ESI Contributions

The completed ESI Payable Ledger creation screen is displayed as shown:

Figure 5.5 ESI Payable Ledger Creation

4. Press Enter to accept

Salary Details setup

Create / Alter Salary Details Master

115
Accounting for Employer ESI Contributions

The completed Salary Details Alteration screen is displayed as shown:

Figure 5.6 Salary Details Alteration screen

4. Press Enter to Accept

Similarly, include Employer ESI @ 4.75% Pay Head in the Salary details of all other Employees.

116
Accounting for Employer ESI Contributions

Processing Employer ESI Contribution

Go to Gateway of Tally > Payroll Vouchers

Figure 5.7 Payroll Autofill - ESI process selection

□ Specify 1-6-2009 and 30-6-2009 in the From and To Date fields respectively
□ Select Primary Cost Category as Employee Category field
□ Select All Items in the Employee/ Group field

117
Accounting for Employer ESI Contributions

□ Select ESI Payable Ledger in the Payroll Ledger field as shown:

Figure 5.8 Payroll Autofill – Payroll Ledger selection

5. Press Enter to accept and go back to the Payroll Voucher screen

118
Accounting for Employer ESI Contributions

The completed Employer ESI Contribution Voucher Creation screen is displayed as shown:

Figure 5.9 Completed ESI Voucher

6. Press Enter to accept

□ The Employer ESI contribution will be computed automatically upon

119
Accounting for Employer ESI Contributions

To process the payment of ESI and generate ESI Challan, follow the steps given below:

Step 1: Create ESI Payment Voucher

Figure 5.10 Employee Filters subscreen - ESI Process Selection

120
Accounting for Employer ESI Contributions

□ Select HDFC Bank in the Bank / Cash Ledger field

Figure 5.11 Employee Filters Subscreen – Bank Ledger Selection

121
Accounting for Employer ESI Contributions

□ Select ESI Payable Ledger in the Payroll Ledger field

Figure 5.12 Employee Filters Subscreen - Payroll Ledger Selection

5. Press Enter to accept and go back to the Payment Voucher screen

122
Accounting for Employer ESI Contributions

6. Press Enter to prefill the Employer’s ESI Contribution amount for the eligible Employees

Figure 5.13 ESI Payment Voucher with Employer Contributions

123
Accounting for Employer ESI Contributions

7. Press Enter again, to prefill the Employee’s ESI Contribution amount against the eligible
Employees

Figure 5.14 ESI Payment Voucher with both Employee and Employer Contributions

8. Press Enter twice

9. Set Yes in the Provide Details field and press Enter
10. In the Provide Details subscreen, specify the Cheque / DD No., Cheque / DD Date and Bank
& Branch Code Details as shown:

Figure 5.15 Complete Provide Details subscreen

11. Press Enter to accept

12. Type the details of the transaction in the narration field

124
Accounting for Employer ESI Contributions

The completed ESI Payment Voucher for the month of June 2009 is displayed as shown:

Figure 5.16 Completed ESI Payment Voucher

13. Press Enter to accept

125
Accounting for Employer ESI Contributions

Step 2: Print ESI Payment Challan

□ Press Pg UP from the above Voucher Entry screen
□ Press Alt + P, the Voucher Printing screen is displayed as shown:

Figure 5.17 ESI Voucher Printing Screen

□ In the Voucher printing screen, select Yes in the Print Challan field
□ Press Enter to Print

126
Accounting for Employer ESI Contributions

The printed ESI Payment Challan for the month of June 2009 of M/s. Spectrum Software
Solutions is as shown:

Figure 5.18 Printed ESI Payment Challan

127
Lesson 6: Payment of Professional Tax

Lesson Objectives
On completion of this lesson, you will be able to:

□ Process payment of Professional Tax

6.1 Processing of Professional Tax Payment

128
Payment of Professional Tax

129
Payment of Professional Tax

■ Select HDFC Bank in the Bank / Cash Ledger field

Figure 6.1 Employee Filters screen - Payment Ledger Selection

■ Select Professional Tax in the Payroll Ledger field

130
Payment of Professional Tax

The completed Employee Filters screen will is displayed as shown:

Figure 6.2 Completed Employee Filters screen

■ Press Enter to accept the screen and go back to the Payment Voucher screen
■ Press Enter to prefill the Professional Tax amount in the Payment Voucher

131
Payment of Professional Tax

The completed Professional Tax Payment Voucher is displayed as shown:

Figure 6.3 Completed Professional Tax Payment Voucher

5. Press Enter to Accept.

Similarly, process the Professional Tax payments for other months.

□ The creation of Professional Tax Pay Head is discussed in detail in Cre-

ation of Masters chapter.
□ The procedure to process Professional Tax Deduction from Employee
Salaries is discussed in detail in the chapter Processing Payroll in
Tally.ERP 9.

132
Lesson 7: Tracking of Salary Advances / Loans

Lesson Objectives
On completion of this lesson, you will be able to:

□ Track Salary Advances / Loans and recoveries in Tally.ERP 9

133
Tracking of Salary Advances / Loans

I. Create Salary Advance Ledger

The completed Staff Salary Advance Ledger creation screen is displayed as shown:

Figure 1.1 Salary Advance Ledger

7. Press Enter to accept.

134
Tracking of Salary Advances / Loans

Modify / Alter Salary Details

The completed Salary Details screen is displayed as shown:

Figure 1.2 Completed Salary details alteration screen

5. Press Enter to accept.

135
Tracking of Salary Advances / Loans

Payment of Salary Advance

In Tally.ERP 9, you may disburse the Salary advance / Loans to Employees using a Payment
Voucher as shown:

Illustration 1:
On 2nd July, 2009 M/s. Spectrum Software Solutions paid Salary Advance to the following
Employees with the mode and amount of recovery.

Employee Name Salary Advance Mode of Recovery Amount

(Rs.) Recovery (Rs.) per month
Rahul 10,000 Monthly Salary 5,000
Rajesh 3,000 Monthly Salary 1,500

The same is accounted as shown:

i. Create Payment Voucher

Setup:
□ Press F12: Configure and set Use Single Entry mode for Pymt/Rcpt/Contra to No

Go to Gateway of Tally > Accounting Vouchers > Payment Voucher (F5)

1. Press F2 to change the date to 2-07-09

136
Tracking of Salary Advances / Loans

2. In the Dr field, select Staff Salary Advance ledger from the list of ledgers

Figure 1.3 Payment Voucher - Salary Advance Ledger selection

137
Tracking of Salary Advances / Loans

The Cost Centre Allocations screen is displayed as shown:

Figure 1.4 Payment Voucher – Cost Centre Allocation screen

□ Specify 10000 in the Amount field

□ Similarly, select other Employee (Rajesh) from the List of Cost Centres and specify the
amount (i.e., 3,000)

138
Tracking of Salary Advances / Loans

The Completed Cost Allocation for subscreen is displayed as shown:

Figure 1.5 Cost Centre Allocation – Sub-screen

□ Press Enter to accept and go back to the Payment Voucher

5. Select HDFC Bank in the Cr field and press Enter
6. Press Enter to accept the Amount
7. Type the details of the transaction in the narration field

139
Tracking of Salary Advances / Loans

The completed Payment Voucher for Salary Advance is displayed as shown:

Figure 1.6 Completed Payment Voucher

8. Press Enter to accept.

Recovery of Salary Advance

Attendance records for July 2009:

Attendance/ Pro- Vijay Rahul Mahesh Ajay Suresh Rajesh
duction Types Kumar
Present Days 26 24 22 25 21 20

140
Tracking of Salary Advances / Loans

ii. Create Payroll Voucher

The Payroll Voucher Creation screen is displayed as shown:

□ Tab down to Staff Salary Advance ledger field of Rahul and specify 5000 as the amount
to be deducted

Figure 1.7 Payroll Voucher - Salary Advance Recovery Entry

□ Similarly, tab down to Staff Salary Advance ledger field of Rajesh and specify 1500 as
the amount to be deducted

141
Tracking of Salary Advances / Loans

□ Similarly, enter the 1500 in Staff Salary Advance for Rajesh

The completed Payroll Voucher for July 2009 is displayed as shown:

Figure 1.8 Completed Payroll Voucher

□ Press Enter to accept.

142
Lesson 8: Accounting for Pay Revision &
Arrears

Lesson Objectives
On completion of this lesson, you will be able to:

□ Record Pay Revisions and Arrears in Tally.ERP 9

Salary Revision / Arrear Calculation for Prior Period

Illustration 1:
On 5th August, 2009 M/s. Spectrum Software Solutions revised the Salaries for the
following Employees. Such a revision is effective from 1st May 2009.

143
Accounting for Pay Revision & Arrears

The revised Salary structure is as follows:

Employee / Pay Components Basic HRA Conveyance Variable Pay
Mahesh 50000 40% 2000 User-defined

Step 1: Modify / Alter Salary Details

Figure 8.1 Salary Details Alteration Screen

144
Accounting for Pay Revision & Arrears

Start Type Options:

Figure 8.2 Completed Salary revision screen

□ Press Enter to accept

145
Accounting for Pay Revision & Arrears

Step 2: Arrear Calculation Voucher

The completed Auto Fill subscreen is displayed as shown:

Figure 8.3 Payroll Auto Fill subscreen

■ Press Enter to automatically prefill the salary arrear amounts for the selected period

146
Accounting for Pay Revision & Arrears

The completed Payroll Voucher for Arrear calculation is displayed as shown:

Figure 8.4 Payroll Voucher – Arrear calculation

□ Press Enter to Accept

Step 3: Payment of Arrears

147
Accounting for Pay Revision & Arrears

The completed Salary Arrears Payment voucher of Mahesh for the period from May 2009 to July
2009 is displayed as shown:

Figure 8.5 Salary Arrears Payment Voucher

□ Press Enter to Accept.

148
Accounting for Pay Revision & Arrears

Salary Revision / Arrear Calculation for current Period

Illustration 2:
On 15th August 2009, M/s. Spectrum Software Solutions revised the Salaries for the
following Employees. Such revision is effective from the current month i.e., August 2009.

The revised Salary structure is as follows:

Employee / Pay Components Basic HRA Conveyance Variable Pay
Ajay 11000 30% 2000 User-defined

The Attendance records for August 2009 is as follows:

Attendance/ Production Vijay Kumar Rahul Mahesh Ajay Suresh Rajesh
Types
Present Days 26 22 25 26 26 26

Step 1: Modify / Alter Salary Details

149
Accounting for Pay Revision & Arrears

The Salary Details Alteration screen is displayed as shown:

Figure 8.6 Salary Details Alteration screen

□ Press Enter to prefill the pay structure (comprising of Earning & Deduction Pay Heads) of
the preceeding period for the specified period
□ Press Enter on Basic Pay Pay Head and alter the amount to 11000
□ Press Enter on HRA Pay Head and alter the percentage to 30% (To alter the percentage,
ensure in F12: Configure, Allow to Override Slab Percentage is set to Yes)
□ Tab down to Conveyance Pay Head and alter the amount to 2000

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Accounting for Pay Revision & Arrears

□ Press Enter to go to the End of List

The completed Salary Details screen is displayed as shown:

Figure 8.7 Completed Salary Alteration screen

□ Press Enter to Accept

Step 2: Record Attendance

Record Attendance voucher in the manner as explained in previous chapters.

151
Accounting for Pay Revision & Arrears

The completed Attendance Voucher for August 2009 is displayed as shown:

Figure 8.8 Completed Attendance Voucher

Step 3: Process Payroll Voucher

Go to Gateway of Tally > Payroll Vouchers

152
Accounting for Pay Revision & Arrears

The completed Payroll Voucher for August 2009 is displayed as shown:

Figure 8.9 Completed Payroll Voucher

You may process Employer and Employee’s contribution to Provident Fund and Employee’s State
Insurance and payment of Profession Tax in the manner as discussed in the earlier chapters.

153
Lesson 9: Processing Payroll for Contract
Employees

Lesson Objectives
On completion of this lesson, you will be able to:

□ Process Salaries for Contract Employees

In this Chapter, we will discuss the recording of transactions related to computation of salaries for
Contractual employees.

Illustration 1:
On 5th August 2009, M/s. Spectrum Software Solutions hired two persons on contract.

The list of employees along with the contract details is as follows:

S. No. Name of Employee Department / Group Tenure Start Date End Date
1 James Contract Employees 6 Months 5 Aug 09 5 Feb 10
2 Vineet Contract Employees 9 Months 5 Aug 09 5 May 10

154
Processing Payroll for Contract Employees

The Salary details for the above contract employees is as shown:

Employee / Pay Heads Basic Wages Overtime Local Conveyance
James 2000 50 / hr On Actuals
Vineet 2500 50 / hr On Actuals

The same is accounted for as shown:

Create Employee Masters

As discussed in the earlier chapters, you need to create the following Employee Masters to:
1. Employee Group
2. Employees

I. Create Employee Group Master

Figure 9.1 Completed Employee Group Creation

□ Press Enter to Accept

155
Processing Payroll for Contract Employees

II. Create Employee Master

Figure 9.2 Employee Creation screen

Similarly, create other Employee Masters i.e., Vineet.

Create Pay Heads

156
Processing Payroll for Contract Employees

i. Create Basic Wages Pay Head

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
The completed Basic Wages Pay Head creation screen is displayed as shown:

Figure 9.3 Pay Head Creation – Basic Wages

□ Press Enter to Accept.

Similarly, create Overtime Pay Head with On Production as the Attendance Type.

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Processing Payroll for Contract Employees

ii. Create Local Conveyance Pay Head

The completed Local Conveyance Pay Head Creation screen is displayed as shown:

Figure 9.4 Pay Head Creation – Local Conveyance

□ Press Enter to Accept.

iii. Salary Details setup

Create the salary details for the above contract employees as discussed in the earlier chapters.

158
Processing Payroll for Contract Employees

The completed Salary Details creation screen for James is displayed as shown.

Figure 9.5 Salary Details creation screen

□ Press Enter to Accept.

Similarly, create the Salary Details for Vineet.

Record Attendance details

The Attendance and Overtime Details for Contract Employees for August 2009 is as shown.
Attendance/Production Type James Vineet
Absent 1 2
Overtime 15 Hrs 17 Hrs

Step 1: Create Attendance Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F5 for Attendance Vouchers

159
Processing Payroll for Contract Employees

The completed Attendance Voucher for the Contract Employees is displayed as shown:

Figure 9.6 Completed Attendance Voucher

□ Press Enter to Accept

Step 2: Create Production Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F5 for Attendance Vouchers

160
Processing Payroll for Contract Employees

The Production Voucher for Overtime hours is displayed as shown:

Figure 9.7 Completed Production Voucher

□ Press Enter to Accept.

Process Payroll
On 31st August 2009, M/s. Spectrum Software Solutions processed salaries for the
contract employees through Cash. The Local Conveyance for August 2009 is as follows:

Reimbursements Particulars James Vineet

Local Conveyance 1250 1225

The same is accounted as shown:

Create Payroll Voucher

Go to Gateway of Tally > Payroll Vouchers > Press Ctrl+F4 for Payroll Voucher

161
Processing Payroll for Contract Employees

The completed Payroll Voucher for Contract Employees for the month of August 2009 will
appear as shown:

Figure 9.8 Completed Payroll Voucher

□ Press Enter to Accept.

162
Lesson 10: Payroll Reports

163
Payroll Reports

Payroll Reports
In Tally.ERP 9, you can generate the following Payroll related reports.

Chart showing Payroll Reports in Tally.ERP 9

Figure 10.1 Payroll Reports in Tally.ERP 9

164
Payroll Reports

We shall discuss each report in detail in the sections as explained below:

Display Pay Slip

Figure 10.2 Pay Slip

In Tally.ERP 9 Payroll, the Pay Slip can be configured to vertically display the details of attend-
ance, in terms of attendance or production, with Year to Date Values (YTD).

165
Payroll Reports

□ Press F12: Configure and set the following options to Yes

Figure 10.3 Pay Slip F12: Configuration screen

166
Payroll Reports

The F12:Configuration options in Pay Slip are explained as follows:

167
Payroll Reports

The Pay Slip with the above configurations is displayed as shown:

Figure 10.4 Pay Slip with YTD values

168
Payroll Reports

The Vertical Pay Slip is displayed as shown:

Figure 10.5 Configured Pay Slip with Vertical Display

□ You can view additional information in the Pay Slip, by pressing Alt+F1.

169
Payroll Reports

The detailed Pay Slip is displayed as shown:

Figure 10.6 Detailed Pay Slip

170
Payroll Reports

Printing Pay Slip

□ Press Alt+P from the Pay Slip screen, the Printing Pay Slip screen is displayed as
shown:

Figure 10.7 Pay Slip Print Configuration screen

Additional Options in the Pay Slip Printing screen:

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Payroll Reports

The printed Pay Slip of Mr. Vijay Kumar is displayed as shown:

Figure 10.8 Printed Pay Slip

172
Payroll Reports

Emailing Pay Slip

Figure 10.9 Mailing Pay Slip sub screen

□ In the Mailing Pay Slip screen,

173
Payroll Reports

The completed Mailing Pay Slip configuration screen is displayed as shown:

Figure 10.10 Completed Mailing Pay Slip sub screen

174
Payroll Reports

Mailing Pay Slip Configurations

□ Press Enter to Email the Pay Slip

175
Payroll Reports

The Pay Slip sent by e-mail when viewed from the mail box of the employee is as shown:

Figure 10.11 Emailed Pay Slip

Exporting Pay Slip to MS Excel

176
Payroll Reports

The completed Export screen is displayed as shown:

Figure 10.12 Export Pay Slip screen

The Pay Slip exported into Excel will appear as shown:

Figure 10.13 Exported Pay Slip

The Pay Slip can also be exported to pdf, jpeg or other formats as per the requirement.

Multi Pay Slips

177
Payroll Reports

E-mail IDs
To check the E-Mail IDs entered,
Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip > E-
Mail IDs

Figure 10.14 E-Mail IDs - Exceptions Only

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Payroll Reports

The E-Mail IDs report for all the Employees is as shown:

Figure 10.15 E-Mail IDs for All Employees

ail/Print/Export Multi Pay Slips

To E-Mail/Print/Export all the Pay Slips or selected Pay Slips,

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip >
Multi Pay Slips

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Payroll Reports

□ Select the appropriate Employee Category and Employee Group in the Employee FIlters
subscreen as shown:

Figure 10.16 Employee Filters

□ Press Enter to view the Multi Pay Slip report as shown:

Figure 10.17 Multi Pay Slip screen

180
Payroll Reports

To E-Mail/Print/Export Pay Slips for selective Employees, you have to select

the required Employees using the Space bar.
If the cursor is on a particular Category or a Group, then the Pay Slips
belonging to that Category or Group only will be E-Mailed/Printed/
Exported.

Figure 10.18 Employee Filters

□ Press Enter to display the Pay Sheet

181
Payroll Reports

The Pay Sheet is displayed as shown:

Figure 10.19 Pay Sheet

Figure 10.20 F12: Configuration

182
Payroll Reports

The F12:Configuration options in the Pay Sheet are explained as follows.

183
Payroll Reports

□ Set the F12: Configuration screen is displayed as shown:

Figure 10.21 F12: Configuration screen - Pay Sheet

The Pay Sheet with the above configurations will appear as shown:

Figure 10.22 Pay Sheet

184
Payroll Reports

Figure 10.23 Pay Sheet with Category and Group Total

To view the Pay Sheet for a particular Employee Group,

185
Payroll Reports

The Employee Filters screen is displayed as shown:

Figure 10.24 Employee Filters

186
Payroll Reports

The Pay Sheet for the selected Employee Group is displayed as shown:

Figure 10.25 Employee Group Pay Sheet

You can also drill down from the above report to the voucher level, by highlighting the pay heads
column of the required employee and pressing Enter.

You can also print the Pay Sheet, by pressing Alt+P and specifying the required options in the
Pay Sheet Print configuration screen.

187
Payroll Reports

The Pay Sheet Print Configuration screen is displayed as shown:

Figure 10.26 Pay Sheet Print Configuration screen

188
Payroll Reports

The Printed Pay Sheet is displayed as shown:

Figure 10.27 Printed Pay Sheet (Landscape view)

189
Payroll Reports

□ Press Alt+P to print Pay Sheet and set the Increase Line Height for Signature/ Stamp?
field to Yes
The printed Pay Sheet with space for signature/ stamp is as shown.

Figure 10.28 Printed Pay Sheet with space for Signature/ Stamp

190
Payroll Reports

Page 2 of the Printed Pay Sheet is as shown:

Figure 10.29 Printed Pay Sheet with space for Signature/ Stamp – Page 2

191
Payroll Reports

Payroll Statement
A Payroll Statement is a columnar report which displays Group/Department-wise employees’
break-up of selected earnings or deductions, for a specified month or period.

Figure 10.30 Payroll Statement

192
Payroll Reports

Figure 10.31 F12: Configuration

The F12: Configuration options in Payroll Statement Report are as follows:

193
Payroll Reports

□ Show Employee PF Account Number – Set this option to Yes, to dis-

The Employee PF Account Number, IT PAN Number, ESI Number, Passport

Details, Visa Expiry Date options will be available in F12: Configure only
when the options, Show Statutory details and Passport & Visa details, are
set to Yes in F12: Payroll Configuration.

194
Payroll Reports

The Payroll Statement with the above Configurations is displayed as shown:

Figure 10.32 Payroll Statement with additional information

□ You can also Email or Export Payroll Statement in the manner as dis-
cussed in Pay Slip Section.
□ The Button Bar options in Payroll Statement are same as in the Pay-
sheet report.

195
Payroll Reports

The Payroll statement with additional Pay Heads will be displayed as shown:

Figure 10.33 Payroll Statement with additional Columns

As discussed earlier, the contents of the Payment Advice can be altered in F12: Payroll Configu-
ration as per the employer’s requirements.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Payment
Advice

196
Payroll Reports

The Printing Configuration for Payment Advice is displayed as shown:

Figure 10.34 Printing Configuration for Payment Advice

□ Press Backspace and enter the details as shown above

□ Press Enter to print

197
Payroll Reports

The printed Payment Advice for May 2009 will appear as shown:

Figure 10.35 Printed Payment Advice

198
Payroll Reports

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Payroll
Register
The Payroll Register is displayed as shown:

Figure 10.36 Payroll Register

□ Press F12: Configure and set the Appearance of Names and the Periodicity to use as
shown.

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Payroll Reports

The F12: Configuration screen is displayed as shown:

Figure 10.37 F12: Configuration

The Payroll Register with the above configurations is displayed as shown:

Figure 10.38 Payroll Register - Quarterly

Tally.ERP 9 allows you to drill down to the voucher level from the above display for any kind of
verification. Use the Enter key on the required month/period to drill down to the required level.

200
Payroll Reports

The Payroll Register voucher level screen is displayed as shown:

Figure 10.39 Payroll Voucher Register

You can further drill down to the transaction level, by selecting the required transaction and
pressing Enter.

Employee Pay Head Breakup

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Employee Pay
Head Breakup

□ Select the required Pay Head from the List of Pay Heads and press Enter

201
Payroll Reports

The Employee Breakup of Pay Head for Basic pay screen is displayed as shown:

Figure 10.40 Employee Breakup of Pay Head

To drill down to Employee Summary report from the above display,

□ Select Employee Category and press Enter
□ Press Alt+F1 to view the detailed report

202
Payroll Reports

The Employee Summary screen is displayed as shown:

Figure 10.41 Employee Summary

You can also Email or Export Employee Breakup of Pay Head Report in
the manner as discussed in Pay Slip Section.

To drill down to the Employee Monthly Summary report from the Employee Summary report,
□ Highlight the required employee and press Enter

203
Payroll Reports

The Employee Monthly Summary screen is displayed as shown:

Figure 10.42 Employee Monthly Summary

To further drill down to Employee Voucher level screen from the Employee Monthly Summary
report, press Enter on the required month.

204
Payroll Reports

The Employee Summary voucher level screen is displayed as shown:

Figure 10.43 Employee Vouchers Summary

You can further drill down to the transaction level, by selecting the required transaction and
pressing Enter.

The Employee Breakup of Pay Head report can be viewed with additional Pay Heads, by
pressing Alt+C and adding the required Pay Head and by pressing Alt+N for multiple periods.

Pay Head Employee Breakup

A Pay Head Employee Breakup report displays the sum of transactions and closing balance of
the transacted groups for the selected employee.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll >Pay Head
Employee Breakup

205
Payroll Reports

The Employee Selection screen is displayed as shown:

Figure 10.44 Employee Selection

To view the Pay Head breakup,

□ Select the required Employee from the List of Employees and press Enter
□ Press Alt+F1 for a detailed view

206
Payroll Reports

The ledger-wise Breakup of Employee screen is displayed as shown:

Figure 10.45 Pay Head Employee Breakup

To further drill down to view the Breakup of Employee report for each ledger from the above
displayed report, select the required ledger and press Enter.

207
Payroll Reports

The Breakup of Employee screen for a selected ledger (Basic Pay) is displayed as shown:

Figure 10.46 Ledger Monthly Summary

You can drill down further to view the Monthly Summary of the selected ledger and the Employee
Voucher report.

The Pay Head Employee Breakup report can be viewed with additional employees, by pressing
Alt+C and adding the required Employee and for multiple periods, by pressing Alt+N.

Go to Gateway of Tally > Display > Payroll Reports > Attendance Sheet

208
Payroll Reports

The Attendance Sheet is displayed as shown:

Figure 10.47 Attendance Sheet

You may configure the above report with additional details, by pressing F12:Configure and
enabling the following options, as required.
The completed F12: Configuration screen is displayed as shown:

Figure 10.48 F12: Configuration screen

209
Payroll Reports

F12: Configurations for Attendance Sheet:

210
Payroll Reports

The Attendance Sheet with the above Configurations is displayed as shown:

Figure 10.49 Attendance sheet

Go to Gateway of Tally > Display > Payroll Reports > Attendance Register

211
Payroll Reports

The Attendance Register is displayed as shown:

Figure 10.50 Attendance Register

□ Press F12: Configure and set the Appearance of Names and the Periodicity to use as
shown
The F12:Configuration options in Attendance Register are as displayed below:

Figure 10.51 F12: Configuration for Attendance Register

Tally.ERP 9 allows you to drill down to the voucher register, from the Attendance Register screen
for any kind of verification.

212
Payroll Reports

The Voucher level screen from Attendance Register is displayed as shown:

Figure 10.52 Attendance Voucher Register

You may further drill down to voucher level, by pressing Enter on the required transaction.

Passport Expiry Report

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Passport Expiry

213
Payroll Reports

The Passport Expiry Report is displayed as shown:

Figure 10.53 Passport Expiry Report

□ Press F12: Configure to configure additional options

The F12: Configuration screen is displayed as shown:

Figure 10.54 F12: Configuration screen

214
Payroll Reports

Button options in Passport Expiry Report:

Visa Expiry Report

The Visa Expiry Report provides information on the visa details of employees i.e., visa number,
visa Expiry date and other details such as the employee's date of joining and email id.

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Visa Expiry

215
Payroll Reports

The Visa Expiry Report is displayed as shown:

Figure 10.55 Visa Expiry Report

The F12: Configuration and Button Options are the same as shown in
Passport Expiry Report.

216
Payroll Reports

Contract Expiry Report

Go to Gateway of Tally > Display > Payroll Reports > Expat Reports > Contract Expiry

The Contract Expiry Report is displayed as shown:

Figure 10.56 Contract Expiry Report

The F12: Configuration and Button Options are the same as shown in
Passport Expiry Report.

217
Payroll Reports

Payroll Statutory Reports

Figure 10.57 Payroll Statutory Reports in Tally.ERP 9

218
Payroll Reports

Provident Fund Reports

In this section, we will generate each of the above mentioned forms / report and understand the
purpose and information to be furnished.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Computation
□ Press F2 and specify the period as 01-07-2009 to 31-07-2009 and press Enter

219
Payroll Reports

The Payroll Statutory Computation Report is displayed as shown:

Figure 10.58 Payroll Statutory Computation Report

□ Press Enter

Figure 10.59 F12: Configurations screen

220
Payroll Reports

The PF Computation report will is displayed as shown:

Figure 10.60 PF Computation screen

To view detailed ledger wise information under each contributions / deductions head, press
Alt+F1.

221
Payroll Reports

The detailed Provident Fund Computation Report is displayed as shown:

Figure 10.61 Detailed PF Computation Report

You can further drill down to Employee Breakup of Pay Head report and from there to Employee
Vouchers and so on, by pressing Enter on the required ledger from the above screen.

222
Payroll Reports

□ Select Account Number as the Sorting Method

□ Specify 30-06-2009 in the Date field
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.62 Payroll Statutory Print Configuration screen

□ Press Enter to print.

223
Payroll Reports

The printed PF Form 5 is displayed as shown:

Figure 10.63 PF Form 5

In our case study, there are two new employees who have joined during the month of June 2009
and thus Form 5 contains the details of these employees.

224
Payroll Reports

Figure 10.64 Payroll Statutory Print Configuration screen

□ Press Enter to print

225
Payroll Reports

The printed Form 10 is displayed as shown:

Figure 10.65 Printed Form 10

226
Payroll Reports

iv. Form 12A

Figure 10.66 Completed Print Configuration screen

□ Press Enter to print

227
Payroll Reports

The printed Form 12A is displayed as shown:

Figure 10.67 Printed Form 12A

228
Payroll Reports

Figure 10.68 Print Configuration screen

□ Press Enter to Print.

229
Payroll Reports

The printed PF Monthly Statement for August 2009 is displayed as shown:

Figure 10.69 PF Monthly Statement

230
Payroll Reports

Form 3A is a annual contribution card to be furnished for each employee in separate sheets to
EPFO. To print Form 3A, follow the steps given below:

Figure 10.70 Payroll Statutory Print Configuration

□ Press Enter to Print.

231
Payroll Reports

The printed Form 3A for Ajay is displayed as shown:

Figure 10.71 Printed PF Form 3A

The next page will contain the Contribution Card in Form 3A for the next employee.

232
Payroll Reports

Figure 10.72 Payroll Statutory Print Configuration for PF Form 6A

□ Press Enter to Print.

233
Payroll Reports

The printed Form 6A is displayed as shown:

Figure 10.73 Printed Form 6A - Page 1

234
Payroll Reports

The Page 2 of PF Form 6A is displayed as shown:

Figure 10.74 Printed Form 6A - Page 2

235
Payroll Reports

viii. E-Return for PF Form 3A

Tally.ERP 9 also allows to generate the PF Form 3A in dbf fomat. The dbf format of this form can
be copied to a CD and submitted to the PF department.
To generate the PF Form 3A in dbf format,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Provident Fund >
E-Return
□ Press Backspace and specify the details as shown:

Figure 10.75 Exporting Form 3A in dbf format

□ Press Enter to Export the form in the required format.

Employee’s State Insurance Reports

236
Payroll Reports

i. ESI Computation Report

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Computation
□ Press F2 and specify the period as 01-07-2009 to 31-07-2009 and press Enter

Figure 10.76 Payroll Computation report

□ Press Enter

Figure 10.77 F12: Configuration screen

237
Payroll Reports

The ESI Computation report is displayed as shown:

Figure 10.78 ESI Computation report

To view the detailed ledger wise information under each contributions / deductions head, press
Alt+F1.

238
Payroll Reports

The detailed Employee State Insurance Computation Report is displayed as shown:

Figure 10.79 Detailed ESI Computation report

You can further drill down to Employee Breakup of Pay Head report and from there to Employee
Vouchers and so on, by pressing Enter on the required ledger from the above screen.

ii. ESI Form 3

239
Payroll Reports

□ Type the Designation details of the person submitting the declaration form
The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.80 Payroll Statutory Print Configuration for ESI Form 3

□ Press Enter to Print.

240
Payroll Reports

The printed Form 3 (Return of Declaration) is displayed as shown:

Figure 10.81 Printed Form 3

241
Payroll Reports

iii. ESI Monthly Statement

The completed Payroll Configuration Print screen is displayed as shown:

Figure 10.82 Payroll Statutory Print Configuration screen

□ Press Enter to Print.

242
Payroll Reports

The printed ESI Monthly Statement for August 2009 is displayed as shown:

Figure 10.83 ESI Monthly Statement

243
Payroll Reports

The completed Payroll Statutory Print Configuration screen for ESI Monthly Statement is
displayed as shown:

Figure 10.84 Payroll Statutory Print Configuration screen

244
Payroll Reports

□ Press Enter to Print

The printed From 5 is displayed as shown:

Figure 10.85 Printed Form 5 - Page 1

245
Payroll Reports

The Page 2 of Form 5 (includes the CA Form also) is displayed as shown:

Figure 10.86 Printed Form 5 - Page 2

246
Payroll Reports

The Page 3 of Form 5 is displayed as shown:

Figure 10.87 ESI Form 5 - Page 3

247
Payroll Reports

In the Payroll Statutory Print Configuration screen

Figure 10.88 Payroll Statutory Print Configuration for ESI Form 6

□ Press Enter to Print.

248
Payroll Reports

The printed Form 6 is displayed as shown:

Figure 10.89 Printed Form 6 - Page 1

249
Payroll Reports

The Page 2 of Form 6 is displayed as shown:

Figure 10.90 Printed Form 6 - Page 2

250
Payroll Reports

The Page 3 of Form 6 is displayed as shown:

Figure 10.91 Printed Form 6 - Page 3

251
Payroll Reports

Professional Tax Reports

i. Professional Tax Computation Report

252
Payroll Reports

The completed Payroll Statutory Print Configuration screen is displayed as shown:

Figure 10.92 Payroll Statutory Print Configuration screen

■ Press Enter to Print.

253
Payroll Reports

The printed Professional Tax Computation report for the month of August 2009 will appear as
shown:

Figure 10.93 Printed PT Computation Report

254
Payroll Reports

ii. Professional Tax Statement

Figure 10.94 Payroll Statutory Print Configuration screen

□ Press Enter to Print.

255
Payroll Reports

The printed Professional Tax Statement for August 2009 is displayed as shown:

Figure 10.95 Printed Professional Tax Statement

256
Payroll Reports

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Gratuity Report

257
Payroll Reports

The Gratuity Report for the Employees eligible for Gratuity is displayed as shown:

Figure 10.96 Gratuity Summary Report

The above report displays the Gratuity Amount computed for each month for each Employee.

In order to ascertain the Gratuity payable amount, set Use for Gratuity to
Yes in the Pay Head master (i.e. Basic Pay, Dearness Allowance etc.)

258
Payroll Reports

Button Options in the Gratuity Report:

The above report displays the details of all employees along with the Date of Birth, Date of Joining
and the Gratuity Eligible Salary, besides commenting on the total Gratuity liability as on date.

Press F12: Configure to configure for additional options

Figure 10.97 F12: Configuration screen

Tally.ERP 9 allows you to drill down to the Gratuity Details report from the above display.
□ Select the required employee and press Enter

259
Payroll Reports

The Gratuity Details screen is displayed as shown:

Figure 10.98 Gratuity Details Report

The above report displays the detailed Gratuity computation for all the slabs entered during the
Gratuity Pay Head Creation.

260
Getting Started with Income Tax
The information contained in this document is current as of the date of publication and subject to change. Because Tally must respond
to changing market conditions, it should not be interpreted to be a commitment on the part of Tally, and Tally cannot guarantee the
accuracy of any information presented after the date of publication. The information provided herein is general, not according to
individual circumstances, and is not intended to substitute for informed professional advice.

Version: Getting Started with Income Tax/Tally.ERP 9 Series A Release 3.2/September 2011
Contents
Introduction .................................................................................................................................... 1

Lesson 1: Configuring Income Tax................................................................................................................. 5

Lesson 2: Income Tax Master Configuration

Pay Head Configuration ................................................................................................................... 7
Employee’s Income Tax Declarations ............................................................................................ 12
Rent Declaration for House Rent Allowance .......................................................................................... 13
Declaration of Investments U/s 80C & 80CCF ...................................................................................... 16
Other Deductions (U/s 80D, 80DD, 80E etc.) ........................................................................................ 21
Override Income Tax ...................................................................................................................... 23
Tax Configuration........................................................................................................................... 23
Previous Employer Details ............................................................................................................. 27
Pay Head Creation for Income Tax Deduction ............................................................................... 27
Creating Income Tax Pay Head ............................................................................................................. 28
Create/Alter Salary Details .................................................................................................................... 29

Lesson 3: Processing Payroll

Recording Attendance .................................................................................................................... 31
Processing Payroll Vouchers .......................................................................................................... 36
Processing User Defined Pay Heads ...................................................................................................... 37
Processing Salary with Income Tax Deduction ..................................................................................... 39
Processing Payments.............................................................................................................................. 40

Lesson 4: Income Tax Reports

Computation Report ....................................................................................................................... 46
Salary Projection.................................................................................................................................... 52
Challan Reconciliation.................................................................................................................... 53
Returns ............................................................................................................................................ 55
Form 24Q ............................................................................................................................................... 55
Annexure I to 24Q .................................................................................................................................. 57
Annexure II to 24Q ................................................................................................................................. 59
4.3.4 Form 16 .................................................................................................................................................. 63
4.3.5 Form 12BA ............................................................................................................................................. 65
4.3.6 ITR-1 ...................................................................................................................................................... 66
E-Return ......................................................................................................................................... 70
4.4.1 E-24Q ..................................................................................................................................................... 70
4.4.2 Print Form 27A ...................................................................................................................................... 73
Exception Reports........................................................................................................................... 75
PAN Not Available ................................................................................................................................. 75
Other Records ........................................................................................................................................ 77
TDS Variance ......................................................................................................................................... 78

i
Introduction

Income Tax refers to the tax that is levied on the personal or business income as per the Income
Tax Act, 1961. The Tax which is levied on the Business Income for a firm or a corporate is referred
as Corporate Tax and will not be dealt in this book. This book covers the personal income which is
received as salary or professional fees. In particular, this book deals with the Income that origi-
nates from Salaries. To understand the Income Tax Act, it is important for you to understand the
basic terms used in the Act which are described one by one.
Assessment Year
As per section 2(9) of Income Tax Act, 1961, the Assessment Year means the period of twelve
months commencing on the 1st day of April every year and ending on 31st March of the next year.
for 2010-11, the assessment year will be from 1st April 2010 to 31st March 2011 for
the Financial Year 2009-2010.

Previous Year
Previous year refers to the Financial Year immediately preceding to the Assessment Year. e.g. for
2010-2011, the Previous year will be from 1st April 2009 to 31st March 2010.

Assessee
As per Income Tax Act 1961 (Act no. 43), an assessee is a person by whom any tax or any other
sum of money is payable under this Act, which includes:
 every person in respect of whom any proceeding under this Act has been taken for the
assessment of his income 25[or assessment of fringe benefits] or of the income of any
other person in respect of which he is assessable, or of the loss sustained by him or by
such other person, or of the amount of refund due to him or to such other person
 every person who is deemed to be an assessee under any provision of this Act
 every person who is deemed to be an assessee in default under any provision of this Act

Person
As per Income Tax Act, the person includes:
 an individual
 a Hindu Undivided family
 a Company or organisation
 a firm

1
 an association of persons or a body of individuals
 a local authority

Total Income
i. Total Income for Resident
As per the provisions of Income Tax Act, the total income of any previous year of a person who is
an Indian resident includes all income from whatever source derived which:
 is received or is deemed to be received in India in such year by or on behalf of such person
 accrues or arises or is deemed to accrue or arise to him in India during such year
 accrues or arises to him outside India during such year
Provided that, in the case of a person not ordinarily resident in India within the meaning of sub-
section (6) of section 6, the income which accrues or arises to him outside India shall not be so
included unless it is derived from a business controlled in or a profession set up in India.
ii. For Non Resident Indian
As per the provisions of Income Tax Act, the total income of any previous year of a person who is
a non-resident includes all income from whatever source derived which:
 is received or is deemed to be received in India in such year by or on behalf of such person
 accrues or arises or is deemed to accrue or arise to him in India during such year.

Gross Total Income

Total income computed in accordance with the provision of the Income Tax Act before making any
deduction under Chapter VIA. Gross Total Income or Gross Salary includes the following:
 Salary as per provisions contained in Section 17(1): Includes all earning pay com-
ponents.
 Value of Perquisites u/s 17(2) (as per Form 12BA): Includes all perquisites (Non-
Monetary Benefits) values paid to the employees.
 Profits in lieu of Salary u/s 17(3) (as per Form 12BA): Includes Any compensation
paid to the employees in connection with termination, modification of terms of employ-
ment, amount paid prior to employment etc.

Allowances exempted U/s 10

Following are the allowances which are exempted U/s 10 of Income Tax from the Gross Salary for
the Computation of Income Tax:
 Allowance provided to the Employees working in transport system
 Border Remote area allowance
 Children education allowance (for a maximum of two children)
 Children Hostel Expenditure Allowance (for a maximum of two children)
 Conveyance Allowance
 Counter Insurgency Allowance - provided to the members of armed forces operating in
areas away from their permanent locations
 Field Area Allowance - Compensatory field area allowance provided in various areas of
Arunachal Pradesh, Manipur, Nagaland, Sikkim, HP, UP and J&K.
Introduction

 Gratuity - paid at the time of retirement

 High Altitude Allowance
 Highly Active Field Area Allowance
 House Rent Allowance
 Island Duty Allowance
 Leave Encashment on Retirement
 Leave Travel Allowance
 Medical Reimbursement
 Mining/Underground Allowance
 Modified Field Area Allowance
 Retrenchment Compensation - A Compensation given to workers at the time of closing
down of Undertaking or transfer
 Tribal Scheduled Area Allowance
 Voluntary Retirement Allowance

For more information on eligibility criteria for each allowance type you can refer to
the Income Tax web site as these keeps changing from time to time.

Deductions U/s 16
Following are allowed as deductions from the Gross Salary for the computation of Taxable income
U/s 16 of Income Tax Act:
 Entertainment Allowance - Entertainment allowance specially granted to an employee
who is in receipt of Salary from Government.
 Professional Tax - Tax on Employment

Other Income Declared by Employee

The Other Income Declared by the Employee Income from House Property, Other sources if
any is added to the Gross Income for the computation of Taxable salary.

Deductions Under Chapter VI-A

Following are additional deductions allowed as deductions from the remaining salary for the com-
putation of Taxable Income:
 Investments U/s 80C, 80CCF - all the investments such as Insurance, Mutual funds,
House loan principal amount etc. are considered as eligible investment for the computation
of Taxable income.
 Other expenses U/s 80D, 80DD, 80E etc.- Other expenses such as Mediclaim, Dona-
tions, payment of interest on loan for higher education etc. are allowed as other deductions
for the computation of Taxable Income.

3
Introduction

Relief U/s 89,90,91

The special reliefs granted to some employees due to the dual taxation system are also allowed
as Relief U/s 89,90 and 91 and is reduced from the Taxable Income based on the type of
agreement with the other country.

Taxable Income
The Net Income which is arrived after considering all eligible exemptions, investments and deduc-
tions is known as Taxable Income. The Income Tax is computed on the Net Taxable Income for
each employee.

4
Lesson 1: Configuring Income Tax

Income Tax Configuration is a simple and one time process in Tally.ERP 9.

To configure Income Tax,

Go to Gateway of Tally > F11: Features > F3: Statutory & Taxation

The Payroll and Payroll Statutory features should be enabled in Tally.ERP 9, before
configuring the Income Tax.

 Set the option Set/Alter Payroll Statutory Details to Yes

 Under Income Tax section,
 Specify your Company’s TAN in the Tax Assessment Number field
 Specify the Income Tax ward details in the Income Tax Circle/Ward field
 Select the required Deductor Type based on the type of organisation from the List of
Company Type
 Specify the name of person who is responsible for deducting Income Tax in Name of
Person responsible field
 Specify the fathers name for the person responsible for deducting Income Tax in Son/
daughter of field
 In Designation field specify the formal designation of the person responsible for
deducting Income Tax.

5
Configuring Income Tax

 Tax Assessment Number: The Tax Assessment Number (TAN) is a 10-digit

alphanumeric number, issued by the Income Tax Department (ITD) to the col-
lectors.
 Income Tax Circle / Ward: This will be provided by the IT department.
 Deductor Type: Deductor Type should be selected based on the Nature of
Organisation from Government and Others.

The completed Payroll Statutory Details screen appears as shown:

Figure 1.1 Payroll Statutory Details

 Press Enter accept and save.

Once the Income Tax is configured, the new menu options will be available under the Payroll
Masters and Payroll Reports to configure Income Tax and to check the respective reports.

6
Lesson 2: Income Tax Master Configuration

Tally.ERP 9 requires the following Master setup for the Income Tax to be computed successfully
for all the Employees, for all the existing Payroll users:
 Pay Head Configuration
 Income Tax Configuration
 Employee Declarations
Following are the optional configurations:
 Declaring Previous Employer Income/Details
 Override Income Tax Exemption Value
 Override Income Tax Value

Pay Head Configuration

All the existing Pay Heads have to be re-configured for Income Tax before processing the Payroll
for successful Income Tax Computation. If there is any amount (perquisites) paid to Employees
without using the Payroll Vouchers, the respective ledgers also needs to be identified for success-
ful Income Tax computation.

By default all the existing Pay Heads are considered as fully taxable and hence
incorrect Tax Computation may be projected. To display the correct Tax Computa-
tion, you will have to reconfigure the Existing Pay Heads.
The Professional Tax and Provident Fund Pay Heads are configured for Income Tax
by default.

Example 1:
Spectrum Software Services is already using Tally.ERP 9 Payroll and has the following Pay
Heads:

7
Income Tax Master Configuration

Earnings Pay Heads Deductions Others

Basic Pay Employee’s PF Gratuity
House Rent Allowance Employee’s ESI Employer EPS Contribution
Conveyance Professional Tax Employer EPF Contribution
Overtime Pay PF Admin Charges @0.01%
Variable Pay EDLI Contribution @ 0.5%
Children Education EDLI Admin Charges
Allowance @0.01%
Employer ESI Contribution
Bonus is also Paid to the Employees using normal Payment Voucher using the Bonus Ledger.

To configure the existing Pay Heads for Income Tax,

Go to Gateway of Tally > Payroll Info. > Income Tax Details > Pay Head Configuration
 Move the cursor to the required Pay Head using up and down arrow keys and press Enter
 In the Income Tax Configuration screen,
 Select the required Income Tax Component Type for the selected Pay Head as shown:

Figure 2.1 Income Tax Configuration - Income Tax Component selection

8
Income Tax Master Configuration

 Select the required Method of Calculation from Projected or On Actuals

 Deduct TDS across Period(s) will be defaulted to Yes for all Projected Pay Heads
The completed screen for Income Tax Configuration for Basic Pay appears as shown:

Figure 2.2 Completed Income Tax Configuration screen

 Press Enter to accept and save.

Income Tax Configuration details

 Name of Pay Head /Ledger: This will display the name of the selected compo-
nent.
 Master Type: This will display the information whether the selected component
is a Pay Head or a Ledger.
 Income Tax Component: The required Income Tax component type has be
selected from the list of Income Tax Components for proper tax computation.
 Method of Calculation: The required method of Income Tax Calculation
should be selected from Projected or On Actuals.
 When the Method of Calculation is selected as Projected, the respective
Pay Heads value/amount will be projected for Income Tax Computation for
the entire year (based on the date of joining).
 When the Method of Calculation is selected as On Actuals, the respective
Pay Heads value/amount will be considered for Income Tax computation
based on the actual (Voucher) value paid/payable to the Employee in that
particular month.
 Deduct TDS Across Period(s): If this option is set to Yes and Method of Cal-
culation is selected as On Actuals, the Income Tax computation for the
respective Pay Head will be distributed across the remaining period. Else entire
amount will be deducted in the same month in which it is paid/payable.

9
Income Tax Master Configuration

The Pay Head Configuration screen after setting the Income Tax Configuration for Basic Pay
appears as shown:

Completed Income Tax Configuration for Children Education Allowance Pay Head is as
shown:

Figure 2.3 Completed Income Tax Configuration screen

10
Income Tax Master Configuration

Completed Income Tax Configuration for Conveyance Pay Head is as shown:

Figure 2.4 Completed Income Tax Configuration screen

Completed Income Tax Configuration for Employee’s Provident Fund Deduction Pay Head is
as shown:

Figure 2.5 Completed Income Tax Configuration screen

Similarly, other Pay Heads can also be configured.

You can also configure the Ledgers which are used to make the payments to the Employees for
the respective Income tax Components from the Pay Head Configuration screen.
To configure a Ledger for Income Tax,
 Click on A: Add Ledger or press Alt+A button
 Select the required Ledger from the List of Ledgers

Figure 2.6 List of Ledgers

 Select the required parameters in the Income Tax Configuration screen

11
Income Tax Master Configuration

The completed Income Tax Configuration screen for Bonus Ledger is displayed as shown:

Figure 2.7 Income Tax Configuration for Bonus Ledger

The completed Pay Head Configuration screen is displayed as shown:

Figure 2.8 Pay Head Configuration screen - completed

Employee’s Income Tax Declarations

The Employee’s have to declare their savings, investment and other details such as rent paid,
Conveyance, LTA etc. to get the correct Tax Computation after considering these declarations.
Example 2:
Spectrum Software Services collected the Income Tax Declaration details for all the Employees
on 15.4.2010.

12
Income Tax Master Configuration

Rent Declaration for House Rent Allowance

House Rent Declarations are required to be made to get the benefit towards the House Rent
Allowance of Income Tax. Tally.ERP 9 allows the option to declare the House Rent Paid (Payable)
for single Employee or multiple Employees.

Example 3:
The HRA details as declared by the Employees is given below:
Sl. No. Name of Employee HRA Amount
1 Ajay 5000
2 Mahesh 10000
3 Rahul 6000
4 Vijay Kumar 7000

To declare the House Rent paid (payable),

Go to Gateway of Tally > Payroll Info. > Declarations
 Under Exemptions, select Rent and Place of Accommodation and press Enter

Figure 2.9 Income Tax Declaration screen

13
Income Tax Master Configuration

 In the Employee Filter sub screen, select All Employee

Figure 2.10 Employee Filter screen

In the above screen you can select an individual Employee and enter the HRA
details one by one for all the Employees.
Selecting All Items will allow you to enter the HRA details for all the Employees
from single screen.
 In the House Rent Declaration screen,
 Specify the Effective From date as 1.4.2010
 Enter Rent Declared as 5000
 Rent Proof field can be skipped while entering the declaration
 Select Non-Metro as Place of Residence for Bangalore city

 Effective From: The date from when the Rent is paid in the current financial
year has to be specified.
 Rent Declared: Monthly Rent as declared by the Employee has to be specified
in this field.
 Rent Proof: Actual Rent Paid by the Employee has to be entered in this field.
This will be usually entered when the Employee provides the proof of the Rent
Paid by him.
 Place of Residence: Will be Metro for New Delhi, Mumbai, Kolkata and
Chennai. For all other cities it will be Non-Metro.

14
Income Tax Master Configuration

Similarly, you can specify the Rent Declaration for all other Employees also.

Figure 2.11 Completed House Rent Declaration screen

Example 4:
The details required for Child Education Allowance, as given by the Employees are shown below:
Sl. No. Name of Employee No. of Children
1 Ajay 1
2 Mahesh 2
3 Rahul 1
4 Vijay Kumar -

15
Income Tax Master Configuration

Similar to House Rent Allowance, the Child Education Allowance declaration screen is
displayed below:

Figure 2.12 Completed Child Education Allowance screen -1

Similarly, the declaration for Children Hostel Expenditure Allowance, Conveyance Allowance
and Leave Travel Allowance can also be specified.

Declaration of Investments U/s 80C & 80CCF

As per section 80C of the Income Tax Act, certain investments are deductible (up to a maximum
of Rs 1 lakh) from gross total income. This tax exemption is available across individual tax slabs.
As per finance bill 2010-2011, an additional investment of Rs 20,000 into Long Term Infrastructure
Bonds is also allowed which increases the maximum amount from Rs 1,00,000 to Rs 1,20,000.
Some of the main schemes eligible for section 80C benefits are:
 PPF
 ELSS - Mutual Funds
 NSC
 KVP
 Life Insurance
 Senior Citizen Saving Scheme 2004
 Post Office Time Deposit Account
 etc...

16
Income Tax Master Configuration

Example 5:
Below is the list of Investment Details as provided by the Employees for Deductions under 80C &
80CCF:
Sl. Name of Housing Loan Insurance Long Term Infrastructure
No. Employee Repayment Premium Bonds
1 Ajay 50,000 11,000 20,000
2 Mahesh 1,00,000 20,000 20,000
3 Rahul - 7,000 10,000
4 Vijay Kumar - 9,000

To enter the Employee Declaration for Investments made under section 80C & 80CCF,
 Bring the cursor to Multi Employee Single Component under Investments (80C and
80CCF) and press Enter
 Select All Items under Employee Name/Group
 Select Type of Investment under Housing Loan Repayment and press Enter

You have to select the required Investment Type to submit the declaration for the
respective Investment from the List.

17
Income Tax Master Configuration

The Investment Details screen for Housing Loan Repayment appears as shown:

Figure 2.13 Investment Details

In the Investment Details screen,

 For Ajay, specify the Effective From date as 1.4.2010
 Specify the Declared Amount as 50,000
 Proof Amount field can be skipped while entering the declaration

18
Income Tax Master Configuration

 Effective From: The date from when the Investment Proof is applicable. This
will also be used for the Income Tax Computation for the previous period. If the
Employee changes the Investment Declaration the same should be added with
new Effective From date, keeping the earlier date and record intact. e.g. on
1.4.2010 Ajay has declared Housing Loan repayment as 50,000 and on
1.7.2010, the new amount is declared for Housing Loan as 75,000. You have to
record both in the system.
 Amount Declared: Total Principal Amount payable during the year has to be
specified in this field.
 Proof Amount: Actual Rent Paid by the Employee has to be entered in this
field. This will be usually entered when the Employee provides the proof of the
Rent Paid by him.

Similarly the Investment Details for Housing Loan Repayment can be entered for the
remaining Employees also.

The completed Investment Details is displayed as shown:

Figure 2.14 Investment Details

19
Income Tax Master Configuration

Insurance Premium Declaration

The completed Investment Details screen for Insurance Premium is displayed shown:

Figure 2.15 Insurance Premium - Investment Details

20
Income Tax Master Configuration

Long Term Infrastructure Bonds Declaration (Sec 80CCF)

The completed Investment Details screen for Long Term Infrastructure Bonds is as shown:

Figure 2.16 Investment Details - Long term Infrastructure bonds

Similarly, all other Investment Details can also be entered.

To enter the Employee Declarations for any other scheme apart from the ones
given in the List of Investments, select Other Eligible Investments and specify
the Values.

Other Deductions (U/s 80D, 80DD, 80E etc.)

Under Chapter VIA, Other deductions in respect of maintenance including medical treatment of
handicapped, medical insurance for self and dependants (including senior citizens, Donations,
Interest Payment on Loan for higher education etc. are also allowed under section 80D, 80DD,
80E etc. These deductions are in addition to section 80C & 80CCF.

21
Income Tax Master Configuration

Example 6:
Below is the list of Investment Details as provided by the Employees for Deductions under section
80D, 80DD, 80E etc.
Sl. No. Name of Employee Mediclaim Insurance
1 Ajay -
2 Mahesh 15,000
3 Rahul 5,000
4 Vijay Kumar -

To declare the other Deductions allowed under Chapter VIA (U/s 80D, 80DD, 80E etc.),
 Bring the cursor to Multi Employee Single Component under Others (80D, 80DD, 80E
etc.) or press Alt+O
 In the Effective From field specify 1-4-2010
 Select Others in the Condition field from the List of Categories
 Specify required Amount in the Declared Amount field for each Employee
 Proof Amount can be specified later when the Employees provide the required proofs
The completed Chapter VIA - Others declaration screen for Mediclaim Insurance is displayed
as shown:

Figure 2.17 Chapter VI - Other deductions for Mediclaim Insurance

22
Income Tax Master Configuration

 Effective From: The date from when the Investment Proof is applicable. This
will be also used for the Income Tax Computation for the previous period. If the
Employee changes the Investment Declaration the same should be added with
new Effective From date, keeping the earlier date and record intact.
 Condition: Should be selected as Senior Citizens for Employees above 60
Years and for all other Employees Other Category should be selected.
 Declared Amount: Total Principal Amount payable during the year has to be
specified in this field.
 Proof Amount: Actual Rent Paid by the Employee has to be entered in this
field. This will be usually entered when the Employee provides the proof of the
Rent Paid by him.

Similarly, you can specify the other Deductions for Chapter VIA (u/s 80D, 80DD, 80E etc.)

Override Income Tax

The override feature in Tally.ERP 9 Income Tax allows you to do the following:
1. Allow to specify different Income and Exemption slabs for different Employees as they can dif-
fer based on the place of duty or based on the type of work. e.g. high altitude allowance differs
based on the height (from sea level) of work place.
2. It also provides the flexibility to enter the already earned values without using the payroll mod-
ule and now the tax can be computed on the entire value
3. It also allows you to override the tax computation which is done by Tally.ERP 9. This can be
used if an Employee has got any special permission from the accessing officer for lesser
deduction.

Tally.ERP 9 also allows you to override the existing Income and Exemption slabs or it also allows
you to override the Tax amount which is computed by default. The override Exemption value if
specified will be applicable for entire year, whereas the Tax override value will be applicable on
monthly basis for the specified period.

For the detailed usage of Override options, please refer to the Help file.

Tax Configuration

Tax Configuration is a comprehensive Master setup screen for Income Tax which allows you to
Configure Pay Heads/ Ledgers, enter Declarations and specify other declaration details such as
Tax Deducted by previous Employer, any other source or self tax declaration and declaration
about the reliefs provided under section 89, 90 and 91 etc.

23
Income Tax Master Configuration

In other words, Tax Configuration screen is like a Quick Setup which guides the users to make
all the necessary setup required for correct computation of Income Tax. Various items are
arranged in the Tax Configuration screen in the same manner as Form 16 to simplify the entire
user experience.

For illustration purpose Tax Configuration for HRA is explained in this Chapter. You can refer to
Tally.ERP 9 Reference Manual (Help File) for more information on using the Tax Configuration
Master Setup screen.

To configure, Configure HRA Pay Head and enter the Employee Declaration for HRA,
Go to Gateway of Tally > Payroll Info. > Income Tax Details > Tax Configuration
 Bring the cursor to House Rent Allowance under Allowance to the extent exempt u/s
10 as shown:

Figure 2.18 Tax Configuration screen

As discussed earlier, Tax Configuration screen displays the details as per Form 16 and it also
displays the status for each particular as Configured/Not Configured or Note Applicable.
 Press Enter to view the Income Tax Allowance Setup (Setup Helper)

24
Income Tax Master Configuration

Figure 2.19 Income Tax Allowance Setup

The above setup screen is divided based on the type of allowance/income component/invest-
ment:
Masters: Allow you to configure the Pay Head/Ledger for the Income Tax
Declaration or Define Value: Allows you to enter the Employee Declaration details or define the
required value details.

i. HRA Configuration
As discussed earlier, the HRA Pay Head/Ledger can also be configured from the Income Tax
Allowance Setup screen under Tax Configuration menu as explained:
 Press Enter on Configure Pay Head/Ledger for House Rent Allowance

25
Income Tax Master Configuration

The Pay Head Configuration screen is displayed below:

Figure 2.20 Pay Head Configuration for HRA

You can see that the Pay Head Configuration screen when viewed from Tax Configuration menu
display only the relevant Ledgers/Pay Heads to help the user in speeder configuration. For details
on Configuration of Pay Heads, refer to the Pay Head Configuration section discussed earlier.

Since HRA is dependant on Basic Pay, the above screen also displays the Basic
Pay - Pay Head so that the user can check and configure both the Pay Heads.

ii. HRA Declaration

To enter/modify the HRA values declared by one or all Employees,
 Press Enter on Rent and Place of Accommodation

26
Income Tax Master Configuration

Figure 2.21 House Rent Declaration screen

The Declaration screen for House Rent allowance opens and it allows you to declare the HRA for
one or all the Employees. If already declared you can alter the Declaration values from this
screen.

Previous Employer Details

To correctly compute the Income Tax values, you need to collect the details of the Income
Received and Tax already Deducted/Paid by previous Employer for all the Employees who are
joining in the middle of the financial year. The previous employer Income Details and tax details
can be entered using the Income/Income Exemption Details and Tax Deducted/Paid Details
respectively.

For the detailed usage of Previous Employer Income/Expenses/Tax Paid etc., refer to the help file
(Tally.ERP 9 Reference Manual)

Pay Head Creation for Income Tax Deduction

Though the Computation report displays the Income Tax value for all the Employees without
creating the Income Tax deduction Pay Head, but its mandatory to create the this Pay Head and
add the same to the Salary Details for all the Employees.

27
Income Tax Master Configuration

Creating Income Tax Pay Head

To create the Income Tax Pay Head,
Go to Gateway of Tally > Payroll Info. > Pay Heads > Create
In the Pay Head Creation screen,
 Specify the Name of Pay Head as TDS
 Select Employees’ Statutory Deduction from the List of Pay Heads
 Select Statutory Pay Type as Income Tax from the list as shown:

Figure 2.22 Pay Head creation - Statutory Pay Type selection

 In the field Under select Current Liabilities as the Group

You can configure the TDS Pay Head either under Current Liabilities or Duties &
Taxes.

 Set the option Affect Net Salary to Yes

 Specify the required caption for the Pay Head in Name to appear in Payslip field
 Calculation Type is defaulted with As Per Income Tax Slab
 Select Month as the Calculation Period

28
Income Tax Master Configuration

 Rounding Method and Limit are defaulted for the Income Tax Pay Head Creation

The completed Income Tax Pay Head Creation screen is displayed as shown:

Figure 2.23 Completed Income Tax Pay Head creation

 Press Enter to accept and save.

Create/Alter Salary Details

After creating the Income Tax (TDS) Deduction Pay Head you have to include this Pay Head in
the Salary Details for all the Employees for successful deduction of Income Tax when there
salaries are processed.
To alter the Salary Details,
Go to Gateway of Tally > Payroll Info. > Salary Details > Alter
 Select the required Employee (Mahesh) and press Enter
 In the Salary Details screen, bring the cursor at the end and select TDS Pay Head to add
 Press End of List

29
Income Tax Master Configuration

The completed Salary Details Alteration screen is displayed as shown:

Figure 2.24 Salary Details Alteration screen

 Press Enter to accept and save

Similarly, alter the Salary Details for all the Employees can be altered to add the TDS Pay Head.
Once all the above configuration are successfully completed, you can process the salaries and
deduct the required TDS.

30
Lesson 3: Processing Payroll

Typically, Payroll Processing comprises of the following activities:

 Recording of Attendance and Production details (on time / work)
 Processing Payroll Vouchers
 Payment of Salaries and other statutory payments

There are three types of Payroll Vouchers namely Attendance Voucher, Payroll Voucher and
Payment Voucher, which are by default preset in Tally.ERP 9 to record above Payroll transac-
tions.

Payroll Vouchers are used for the purposes of operating your payroll and also records the attend-
ance of the employees for a given period. These vouchers are basically used to input information
pertaining to Payroll processing.
.
Recording Attendance
An Attendance Voucher allows you to record the attendance/ production units for employees.
Tally.ERP 9 gives you the flexibility to enter the attendance records through a single attendance
voucher for a payroll period, or through multiple attendance vouchers as and when required within
a payroll period.

In Tally.ERP 9, the auto-fill facility (Alt+A) is used to pre-fill the required Attendance/Production
types data for the selected employee group/ employee for the specified period.

31
Processing Payroll

Example 1:
On 30th April, 2010 the attendance records of M/s. Spectrum Software Services displayed
the following details:
Attendance/ Produc- Vijay Kumar Rahul Mahesh Ajay
tion Types
Days Absent 1 1 0 0
Overtime hours 900 Min - - 720 Min
(15hr x 60min) (12hr x 60min)
In the above scenario, separate attendance vouchers are required to be entered for recording
Present days and Overtime hours.

To record the Attendance details,

Go to Gateway of Tally > Payroll Vouchers

 Press Ctrl+F5 for Attendance Voucher
The Attendance Voucher Creation screen is displayed as shown:

Figure 3.1 Attendance Voucher Creation screen

 Press F2 and specify the date as 30-4-2010

 Press Enter

32
Processing Payroll

 Press Alt+A (Attendance Auto Fill) to pre-fill employee payroll details

 In the Attendance Auto Fill screen,
 Specify the Voucher Date as 30-04-2010 if not specified earlier
 Select Primary Cost Category as All Items (If separate cost categories are used to
capture employee cost, then select the respective Employee category)
 Select All Items as Employee/ Group (if you want to generate payroll voucher for indi-
vidual employee/ group, select the respective employee or group)
 Select Absent as Attendance Type in the Attendance/ Production Type field
 Specify the require value that should be prefilled for all Employees e.g. 0
The completed Attendance Auto Fill screen is displayed as shown:

Figure 1.2 Attendance Auto Fill screen

 Press Enter to accept the screen

Separate Attendance vouchers are required for recording attendance on Work and
Production.
If you opt for Present as Attendance Type, then you need to record the negative
attendance of the employees.

33
Processing Payroll

The Attendance Voucher is prefilled with 0 for all required Employees as shown:

Figure 1.3 Attendance Voucher

 Specify the attendance details as given in the table above

34
Processing Payroll

The completed Attendance Voucher Creation screen with the attendance details screen is
displayed as shown:

Figure 3.4 Completed Attendance Voucher Screen

1. Press Enter to accept the completed Attendance Voucher screen.

In the same way, create an Attendance Voucher for Overtime Hours.

35
Processing Payroll

The completed Attendance Voucher for Overtime Hours is displayed as shown:

Figure 3.5 Attendance Voucher Screen - Overtime

 Press Enter to accept.

Processing Payroll Vouchers

A payroll voucher is used to record all employee-related transactions. It enables you to compute
all the values for the respective Pay Heads (Earnings and Deductions).

Example 2:
On 30th April, 2010, M/s. Spectrum Software Solutions processes Payroll for all the
employees and entitled the following employees for Variable Pay.
Particulars Vijay Kumar Rahul Mahesh Ajay
Variable Pay 1500 - 1000 -

36
Processing Payroll

Processing User Defined Pay Heads

The value for the User Defined Pay Heads should be entered prior to computation of Salary.
Go to Gateway of Tally > Payroll Vouchers
1. Press Ctrl+F4 for Payroll Voucher
2. Press F2, specify the date as 30-4-2010 and press Enter
3. Press Alt+A (Payroll Auto Fill) to pre-fill employee payroll details
In the Payroll Auto Fill screen,
 Select User Defined Pay Heads in the Process for field

In Tally.ERP 9, the following processes are preset for faster processing of Payroll:
 User Defined Pay Heads: This process is used for processing the User
Defined Pay Heads e.g. Variable Pay, Incentives.
 Salary: This process is used for processing salaries for a specified period,
wherein Salaries are disbursed through Cash or a bank transfer.
 ESI Contribution: This process is used for processing Employer’s contribu-
tions towards ESI for a specified period.
 PF Contribution: This process is used for processing Employer’s Provident
Fund (PF) contributions for a specified period.

 Specify 1-4-2010 in the From field

 Specify 30-4-2010 in the To field
 Select All Items as Employee/Group
 Select Salary Payable in the Payroll Ledger field

You can select Cash as the Payroll Ledger if you are directly making the payment
from Payroll Voucher itself.

37
Processing Payroll

The completed Payroll Auto Fill screen is displayed as shown:

Figure 1.6 Payroll Autofill with payment Ledger list

 Press Enter to accept the screen

The Payroll Voucher opens and allows the user to enter the user defined Pay Head values one
by one for all the Employees.
 Specify 1000 as Variable Pay for Mahesh
 Similarly, specify 1500 as Variable Pay for Vijay Kumar and press Enter
The completed Payroll Voucher Creation screen is displayed as shown:

Figure 3.7 Completed Payroll Voucher

4. Press Enter to accept.

38
Processing Payroll

Processing Salary with Income Tax Deduction

Once the User Defined Pay Head Values are entered (if any), the salary can be processed by
following the steps given below:

Go to Gateway of Tally > Payroll Vouchers

1. Press Ctrl+F4 for Payroll Voucher
2. Press F2, specify the date as 30-4-2010 and press Enter
3. Press Alt+A (Payroll Auto Fill) to pre-fill employee payroll details
In the Payroll Auto Fill screen,
 Select Salary in the Process for field
 Select Declared Value in the Compute Income Tax based On field as shown:

Figure 1.8 Payroll Auto Fill screen

Compute Income Tax based On:

 Declared Value: This option should be selected to compute Income Tax based
on Declaration Amount as given by the Employees.
 Proof Value: This option should be selected to compute Income Tax based on
the Amount as per the actual Proofs given by the Employees.

 Select all other parameters as explained earlier

The completed Payroll Auto Fill screen for Salary process is displayed as shown:

Figure 1.9 Completed Payroll Auto Fill

39
Processing Payroll

 Press Enter to pre-fill the Payroll Voucher with all Pay values for all Employees includ-
ing Income Tax deduction (TDS)
The completed Payroll Voucher Creation screen is displayed as shown:

Figure 3.10 Completed Payroll Voucher

 Press Enter to accept.

The Employer PF Contribution and Employer ESI contribution processes can also be completed
by using the respective Auto Fill processes.

Processing Payments
In Tally.ERP 9, the Payment Vouchers are used to effect salary disbursement, PF payment, ESI
Payment, Professional Tax payment and Income Tax payment.
To automate the above payments, Auto Fill facility has been provided in the Payment Voucher
screen for error free processing.

Example 3:
On 30th April 2010, M/s. Spectrum Software Solutions paid the salaries due for the month
of April 2010. The PF, ESI, PT and Income Tax were also paid on 30th April 2010.

For illustration, only Income Tax Payment is explained in detail and remaining payments follow the
similar process.

40
Processing Payroll

Before passing the Income Tax payment voucher, necessary Bank Accounts should be created.
To make the Income Tax payment, follow the steps given below:

Go to Gateway of Tally > Accounting Vouchers > Press F5 for Payment Vouchers
 Press F2, specify the date as 30-04-2010 and press Enter
 Press Alt+A (Payroll Auto Fill) to pre-fill employee payroll details
In the Payment Auto Fill screen,
 Select Income Tax Challan in the Process for field as shown.
 Specify 01-04-2010 as From period
 Specify 31-04-2010 as To period
 Specify Voucher Date as 30-04-2010
 Select Primary Cost Category in the Employee Category field
 Select All Items in the Employee/Group field
 Select HDFC Bank in the Bank / Cash Ledger field as shown.
 Select Salary Payable in the Payroll Ledger field
The completed Payment Auto Fill screen is displayed as shown:

Figure 3.11 Payment Auto Fill screen

41
Processing Payroll

 Press Enter and the employee Income Tax details will appear by default as shown:

Figure 1.12 Payment Voucher

 Set Provide Details to Yes

In the Provide Details screen,
 In Cheque / DD No field, specify the correct cheque or DD number (e.g. 23342)
 In Cheque / DD No field, specify the date of Cheque or DD (e.g. 30.04.2010)
 Specify name of depositor (e.g. Ramesh) in Depositor Name field
 In Bank & Branch Code field, specify the Bank Name and Branch Details (e.g. HDFC
& Koramangala)
 In BSR Code field, specify the banks BSR code
 Specify 30.4.2010 as Challan Date
 Specify 4343338 in the Challan Number in number field

42
Processing Payroll

The completed Payment Details screen is displayed as shown:

 Press Enter to accept the Provide Details screen

The completed Income Tax Payment Entry screen is displayed as shown:

Figure 3.13 Payment Voucher

4. Press Enter to accept.

To print the Income Tax Challan (ITNS 281),

 Press Page Up in the Accounting Voucher Alteration screen and press Alt+P
In the Payment Voucher print configuration screen,

43
Processing Payroll

 Set Print Challan to Yes as shown:

Figure 1.14 Voucher Printing configuration

 Print Enter to print Challan

44
Processing Payroll

The printed ITNS 281 Challan is displayed as shown:

Figure 1.15 ITNS 281 Challan

45
Lesson 4: Income Tax Reports

Tally.ERP 9 helps to generate the following Income Tax reports for Employer and Employees:
 Computation Report
 Salary Projection
 Challan Reconciliation
 Returns
 Quarterly
 Form 24Q
 Annexure I to 24Q
 Annexure II to 24Q
 Annual
 Form 16
 Form 12BA
 ITR-1
 E-Return
 E-24Q
 Print Form 27A
 Exception Reports
 PAN Not Available
 Other Records
 TDS Variance

Computation Report
The Computation Report displays the Employee wise Income Tax Computation details in the
Form 16 format. Along with the Total Tax payable, it also displays the balance tax payable, tax
already paid and tax amount to be deducted in the subsequent month.

Tally.ERP 9 provides the flexibility to configure the Pay Heads or add the declaration/proof
amounts by pressing Ctrl+Enter on the required Income Tax Component.

To view the Income Tax Computation report,

46
Income Tax Reports

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Computation

Employee selection screen is displayed as shown:

Figure 4.1 Employee Selection screen

 Select the required Employee and press Enter

The Computation report for the respective Employee is displayed as shown:

Figure 4.2 Income Tax Computation report

The above report displays the Employee details on the top of the screen, on the right hand top
corner it gives the overall Tax deduction snapshot. In the remaining report each Income Tax
Component values are displayed.

47
Income Tax Reports

You can click Ctrl+Enter on any of the Income Tax Component shown in italics. The relevant
button gets highlighted only when the cursor is on the relevant income Tax Component as shown:

Figure 4.3 Income Tax Computation

By default the Computation report displays only relevant Income Tax Computations as per the
applicability.
To view the all the Income Tax Components,
 Press F3 or click on F3: Show all button from Income Tax Computation screen

48
Income Tax Reports

The Computation screen with all components is displayed as shown:

Figure 4.4 Income Tax Computation sheet with all Components

By default the above screen displays the Income Tax Computation based on the Declaration sub-
mitted. To change the computation based on the actual proofs submitted,
 Press F5 or click on F5: Proof Value button from Income Tax Computation screen

49
Income Tax Reports

The IT computation based on Proof Values is displayed as shown:

Figure 4.5 Tax Computation based on Proof Value

You can also view the Computation for each Income Tax Component by pressing Enter on the
respective component.

The display for computation for each individual component can be seen only for
those items which have the declared/proof values. This report will help you to under-
stand the actual computation that is carried in the background.

To view the detailed computation for House Rent Allowance,

 Bring the cursor on press F5 or click on F5: Proof Value button from Income Tax Computa-
tion screen

50
Income Tax Reports

The HRA Computation screen appears as shown:

Figure 4.6 HRA Computation

51
Income Tax Reports

Salary Projection
The Salary Projection report provides the details of the Earnings and Deduction Pay Head values
which are considered for Income Tax for a selected Employees. It provides the projection for
twelve months and displays the actuals if payroll is already processed for any given month.

To display the Salary Projection report,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Salary Projection
 Select the required Employee and press Enter

Figure 4.7 Salary Projection

52
Income Tax Reports

Challan Reconciliation
All the Income Payment Challan details can be reconciled from one single menu known as
Challan reconciliation.
To reconcile Challan details,
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Challan Reconciliation

The Challan Reconciliation screen is displayed as shown:

Figure 4.8 Challan Reconciliation

 Press F5 to reconcile and specify the updated Challan details

53
Income Tax Reports

The completed Challan Reconciliation screen appears as shown:

Figure 4.9 Challan Reconciliation

 Press Enter to accept the updated details

54
Income Tax Reports

Returns
The following Income Tax returns can be generated from Tally.ERP 9:
 Quarterly
 Form 24Q
 Annexure I to 24Q
 Annexure II to 24Q
 Annual
 Form 16
 Form 12BA
 ITR-1

Form 24Q
Form 24Q is a Quarterly statement which contains the details of the salary paid and tax deducted
from the employees, that an Employer needs to submit to the department in each Quarter.
To print Form 24Q,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Returns > Form 24Q
 Specify the Name, Designation and Address of the person responsible for deducting the
TDS along
 Select the Quarter which the TDS returns have to filed
 Specify the Date and Place.

Figure 4.10 Printing Form 24 Q Screen

55
Income Tax Reports

 Press Enter to Print Form 24Q

The print preview of Form 24Q appears as shown:

Figure 4.11 Form 24Q - Page 1

56
Income Tax Reports

Figure 4.12 Form 24Q - Page 2

Along with the Form 24Q, Annexure I and Annexure II is also required to be submitted.
Annexure I is required to be filed with Form 24Q in all four quarters while Annexure II has to be
filed only in the last Quarter.

Annexure I to 24Q
Annexure I is required to be filed with Form 24Q in all four quarters.
To print Annexure I,
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Returns > Annexure I to Form 24Q
Specify the details as shown in the Print Configuration screen:

Figure 4.13 Printing Form 24Q - Annexure I

57
Income Tax Reports

 Press Enter to print Annexure I to Form 24Q

Figure 4.14 Form 24Q - Annexure I

Shown above is the Annexure I for the month of April 2010. Similarly, the Annexure I for May 2010
and June 2010 for that Quarter can also be printed.
To print the Annexure I for the remaining months, select the respective Quarter in the Print Config-
uration screen

58
Income Tax Reports

Annexure II to 24Q
Annexure II has to be filed along with Form 24Q only in the last Quarter (4th Quarter).

To print Annexure II,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Returns > Annexure II to Form 24Q
Specify the details as shown in the Print Configuration screen:

Figure 4.15 Printing Form 24Q – Annexure II

 Press Enter to print Annexure II to Form 24Q

59
Income Tax Reports

The print preview of Annexure II to Form 24Q appears as shown:

Page 1 (A)

Figure 4.16 Form 24Q - Annexure II

60
Income Tax Reports

Page 1 (B)

Figure 4.17 Form 24Q - Annexure II

Page 1 (C)

Figure 4.18 Form 24Q - Annexure II

61
Income Tax Reports

Page 1 (D)

Figure 4.19 Form 24Q - Annexure II

Annexure II to Form 24Q is required to be printed while filing the returns for the last Quarter (4th
Quarter).

62
Income Tax Reports

Form 16
Form 16 is the Certificate issued for tax deducted at source from income chargeable under the
head Salaries.
To view the Form 16,
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Returns > Form 16
 Select the required Employee from the List of Employees and press Enter
 Specify the following details:
 Name: Specify the name of the person responsible for Income Tax Deduction.
 Son/Daughter of: Specify the father’s name for the TDS Deductor
 Designation: Specify the designation of the person responsible for TDS Deduction
 From: By default displays 1-4-2010 which can be changed.
 To: Enter the To date (by default it will be 31.03.2011)
 Challan Date Till: In this field enter the date to consider the challan payments made.
 Type of Copy: Specify Original or Duplicate as required
 Place: Enter the name of the Place (e.g. Bangalore)
 Date of Printing: Specify the Date of issue of Form 16
 Quarter/Acknowledgement: Mention the acknowledgement number of the TDS
returns filed against the appropriate Quarter.
 CIT (TDS) Details: In this section enter the address of the Commissioner of Income
Tax having jurisdiction for TDS deduction for the assessee.
 Address: Enter the address of the commissioner office
 City: Mention the City name
 Pin Code: Enter the PIN Code.
The completed Print Configuration screen for printing Form 16 is displayed as shown:

Figure 4.20 Form 16 - Print Configuration screen

 Press Enter to print Form 16 for the selected Employee

63
Income Tax Reports

The printed Form 16 is displayed as shown:

Figure 4.21 Form 16 - Page 1

64
Income Tax Reports

Figure 4.22 Form 16 - Page 2

Similarly, you can print the Form 16 for all the Employees.

Form 12BA
Form 12BA is the statement displaying the particulars of perquisites, other benefits or amenities
and profits in lieu of salary with value thereof.
Form 12BA can be printed from the following menu:
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Returns > Form 12BA

In this book, printed Form 12BA is not shown as the perquisites are not handled in the case study.

65
Income Tax Reports

ITR-1
Tally.ERP 9 also allows you to print or email the Form ITR-1 which are used to file the Income Tax
return. Similar to Form 16, ITR-1 is also printed separately for each employee.

To generate the form ITR-1,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax >
Returns > ITR-1
 Select the required Employee from the List of Employee and press Enter
The Print Configuration screen for ITR-1 is displayed as shown:

Figure 4.23 Print Configuration for ITR-1

 Press Enter to print the ITR-1

66
Income Tax Reports

The printed ITR-1 form is displayed as shown:

Figure 4.24 ITR-1 Page 1

67
Income Tax Reports

Figure 4.25 ITR-1 Page 2

68
Income Tax Reports

Figure 4.26 ITR-1 Page 3

69
Income Tax Reports

E-Return
The following Income Tax E-returns can be generated from Tally.ERP 9:
 E-24Q
 Print Form 27A

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax > E-
Return

Figure 4.27 E-Return Menu

4.4.1 E-24Q
E- 4Q is a Quarterly e-return which contains the details of the salary paid and tax deducted from
the employees, that an Employer needs to submit to the department in each Quarter.

To export E-24Q
Go to Gateway of Tally > Display > Statutory Reports > Payroll Reports > Income Tax > E-
Return > E-24Q

In Quarterly Return screen press Backspace to make changes in Person Responsible Details
or Other Details fields.
 By default, the Language and Format is preset as Restricted (ASCII Only) and SDF
(Fixed Width) respectively.
 In Export Location field enter the details of the path to where the txt file to be exported
 In Output File Name field the test file name will be displayed as ITeTDS.txt which can be
changed by the users.
 Press Enter to accept the Person Responsible Details (The Address details are automat-
ically defaulted from the Company masters in the Person Responsible Details column)

70
Income Tax Reports

 As per the new E-return structure it is must to specify either Mobile Number or STD Code
with Telephone number in E-24Q file.
 Mobile Number: This field is provided to specify the mobile number of the assessee
 STD Code: This field is provided to enter the STD code
 Telephone: This filed is provided to enter the telephone number of the assessee

As per the new E-return structure it is must to specify either Mobile Number or STD
Code with Telephone Number in E-24Q file.
If the user tries to navigate without specifying the Mobile number or STD Code or
Telephone number application will not allows to move further.

 In Email field enter mail ID of Person responsible for income tax deduction and payment
to the income tax department.
 Select Yes or No as applicable, in Is Change in Address since last Return field.
 Under Other Details,
 Type of Deductor details will be captured form the TDS Details defined in F11: Fea-
tures.
 In Category (deductor/Collector) field select the Deductor Category. e.g. Associa-
tion of Person (AOP)
 In Quarter Period for field select the appropriate Quarter for which the e-return to be
generated.
The Quarterly Return configuration screen is displayed as shown:

Figure 4.28 Quarterly Return Configuration Screen

71
Income Tax Reports

 Press Enter to Export Quarterly Return in 26Q

The exported file is placed in the Tally.ERP 9 Directory with the file name as specified above.

Figure 4.29 Exported File in Tally.ERP 9 Folder

The exported file (form 24Q) is required to be validated with the File Validation Utility (a freely
downloadable utility from NSDL website) and after validation, the returns should be submitted to
the department in CD along with Form 27A in Physical Form.

It is mandatory to validate the TDS returns with File Validation Utility to confirm to
the requirements as prescribed by the Income tax department. In case of any errors
in exported file (Returns), the FVU prompts a error message with error code, the
assessee may correct the same and revalidate the returns. The File Validation Utility
is available for Quarterly and Annual returns separately.
Tally.ERP 9 exports Form 24Q in the text (.txt) format as prescribed by NSDL.

72
Income Tax Reports

Print Form 27A

Form 27A is a summary of TDS return which contains control totals of Amount Paid and Income
Tax deducted at source. Form 27A is to be filed in physical form with each return i.e., Form 24Q.
In case of returns submitted in the physical form, form 27A need not be attached.

To print Form 27A

Go to Gateway of Tally> Display >Statutory Reports > Payroll Reports > Income Tax > E-
Return > Print Form 27A

In Printing Form 27A screen,

 Accept the Person Responsible and Address details (The Address details are automati-
cally defaulted from Company master)
 In Quarter Period for field select the appropriate quarter from the Period list
 Type of Deductor details will be captured form the TDS Details defined in F11: Features
 Specify the Place and Date of filing returns

The completed Printing Form 27A configuration screen is displayed as shown:

Figure 4.30 Printing Form 27A Screen

 Press Enter to Print Form 27A

73
Income Tax Reports

The print preview of Form 27A is displayed as shown:

Figure 4.31 Print Form 27A

74
Income Tax Reports

Exception Reports
The following Exception Reports for Income Tax can be generated in Tally.ERP 9:
 PAN Not Available
 Other Records
 TDS Variance
You can get the required information from the above reports to get the correct Income Tax Com-
putation details.
PAN Not Available
For correct Tax computation, its necessary that you specify the PAN number for all the Employ-
ees. The tax will be computed at higher rate if the PAN number for the Employee is not provided.
You can check the information of Employees for whom the PAN is not provided from PAN Not
Available screen.

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax
Reports > Exception Reports > PAN Not Available

The PAN Not Available report is displayed as shown:

Figure 4.32 PAN Not Available -1

75
Income Tax Reports

 Press F5 (F5: All Items) to view all the Employees PAN details a shown:

Figure 4.33 PAN Not Available - All Employees

 Specify the PAN Details for all the Employees for which PAN is not entered

76
Income Tax Reports

The completed PAN Not Available screen is displayed as shown:

Figure 4.34 Completed PAN Not Available screen

 Press Enter to save the details.

Other Records
The other Records report displays Employee’s personal details, contact details and Bank details.
To view Other Records for Employees,
Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax
Reports > Exception Reports > Other Records

77
Income Tax Reports

The Employee Other records report is displayed as shown:

Figure 4.35 Employee Other Records

You can scroll on the right side to view the remaining details.

TDS Variance
The TDS Variance report provides the Details of TDS amount which is actually payable for not
paid for any of the Employees Groups or all Employees. This will provide the useful information
to the Employer to ensure that the remaining amount is recovered by the Employer in the subse-
quent months.

To view the TDS Variance report,

Go to Gateway of Tally > Display > Payroll Reports > Statutory Reports > Income Tax
Reports > Exception Reports > TDS Variance
 Select the required Employees or All Employees and press Enter

78
Income Tax Reports

The TDS Variance report for all the Employees is displayed as shown:

Figure 4.36 TDS Variance report

The Variance report displays the Actual TDS amount collected in each month and month wise
variable amount.

For more details on usage and description of each field, refer to Help file (Tally.ERP 9 Reference
Manual).

79
Tally.ERP 9 Series A Release 4.93

Income Tax

Agenda
• Enabling Income Tax

• Configuring Employee Masters

• Creating/Altering IT Pay Head

• Income Tax Master Configuration

• Income Tax Reports

Enabling Income Tax
Provide
Income Tax
Details

• Gateway of Tally > F11: Features > Statutory &

Taxation
Enable Payroll
Statutory &
Specify Details

Income Tax Computation

Tally.ERP 9 Identifies,
• All earning components are considered as fully taxable
GatewayThe
of Tally > are
Display > Payroll Reports > Statutory
can beReports >
• PFapproximate
and PT Income
considered forTax Computation
Deduction
Income Tax > Computation
viewed immediately after enabling the Payroll
Statutory Feature, without any further configurations.

Configuring Employee Masters

• Gateway of Tally > Payroll Info. > Employees >

Alter

Income Tax rate gets

selected based on PAN
availability & non availability
Income Tax slab will be
applied based on Gender &
Date of Birth (Senior Citizen)

Create TDS Pay Heads

Create/Alter Salary Details for all Employees for effect TDS Deduction.

• Gateway of Head
Note: If TDS Pay Tallyalready
> Payroll Info.
exists, you have > PaytheHeads
to alter same as>
shown.
Create/Alter

Income Tax Master Configuration
• Pay Head Configuration
• Declarations
• Override Exemption Value
• Override Tax Value
• Tax Configuration
• Previous Employer Details

Pay Head Configuration

• Gateway of Tally > PayPayroll Info > Income Tax

Head Configuration
By default all pay heads are is Completed
Details > Pay Head Configuration
grouped under Other Earnings/
Allowances(Fully Taxable)

When TDS gets computed

method based
ofcalculation
calculation
When
Selectmethod
the Payofhe d and isis
on Projected
selected astoOn or On Actuals
Actuals then
On Projection
press enter then
group Deduct
the
Deduct whichever isperiod
selected
TDS byTDS
Income Taxacross
default will be
Compon can be
set Yes
nts
manually set to Yes or No
respectively

Declarations
• Exemptions U/s 10
o Rent and Place of Accommodation o
Children Education Allowance o Children
Hostel Expenditure Allowance o
Conveyance Allowance o Leave Travel
Allowance

• Deductions Under Chapter VIA o

Investments (U/s 80C and 80CCF) o
Others (U/s 80D, 80DD, 80E etc.)

Declaration of Exemptions U/s 10

Press Enter here, to

declare Rent details
and Place of
Accommodation re
• Gateway of Tally > Payroll Info. > Income Tax
Details > Specify
Declarations
the Rent details, details of Actual rent
Paid and Accommodation
Note: Actual rent Paid can be entered later also

Deductions • under Chapter
Press Alt+I VI-A Single Component declaration
for Multi Employee
• Press Alt+N for Single Employee Multi Component declaration

• Gateway of Tally > Payroll Info. > Income Tax

Similarly, specify details for Other deductions
Details > Declarations

Override Income Tax

•If the
Go employer
to Gateway
wantsoftoTally > Payroll Info. > Income
override the earnings (Income)
Tax Details
or Exemption value or even Tax
value of the employee it can be
done from the Override options

Tax Configuration
• Gross Salary
• Allowance to the extent exempt U/s 10
• Deduction U/s 16
• Other Income reported by Employee
• Deductions under Chapter VI-A
• Relief
• Tax Deduction Details

Allowance to the extent exempted U/s 10
Press Enter to specify
the Declaration

• Gateway of Tally > Payroll Info. > Income Tax

DetailsSpecify
> Taxthe required details and save
Configuration
Press Enter on the
required Component
Press Enter here to
Configure the Pay
Heads

Previous Employer Details

• Gateway of Tally > Payroll Info. > Income Tax

Details

Previous Employer Income/Exemption

and Tax Deduction Details can be
provided from the above masters

Processing Payroll

• Gateway of Tally > Payroll Vouchers

Income Tax
amount Deducted

Press Alt+A for

Payroll Auto Fill

Income Tax Payment

• Gateway of Tally > Specify

Accounting
the detailsVouchers
for > F5
Challan printing

Press Alt+A for Payroll

Press Enter to accept. Press Page
Auto Fill
Up and followed by Alt+P

Payroll Income Tax Reports
• Computation
• Salary Projection
• Returns o Form 16 o Form 12BA o ITR 1
• Challan Reconciliation
• Exception Reports o PAN Not Available o
Other Records o TDS Variance

Payroll Reports

• Gateway of Tally > Display > Payroll Reports >

Statutory Reports > Income Tax

Go to Gateway of Tally > Payroll Info. > Pay Heads > Create

1. Enter Pay Head name in the Name field

2. Select Loans and Advances as the Pay Head Type from the list of Pay Head Type

3. Select Loans and Advances (Assets) from the List of Groups in the Under field

4. By default, Affect Net Salary is set to Yes. Type No, if you do not want this component to
be included in the Pay Slip

5. By default, the Pay Head component name entered in the Name field will appear in the Pay
Slip, if you want to change the default Pay Head component name then alter it in Name to
appear in Payslip field

6. In the Calculation Type field select As User Defined Value from the List of Calculation

[Img-64]

7. Press Enter to accept.

Note: In case i f the i nte rest i s also re cove re d from the Empl oyee ’s sal ary for the
Loan/ Advance gi ve n, Inte re st cal cul ati on fe ature can be use d to cal cul ate the EMI for
e ach month and the same can be re cove re d by se le cti ng the Cal cul ati on Type as Fl at
Rate .
Defining Salary Structure in Tally.ERP 9
Salary Details is used to define the Pay Structure for an Employee or an Employee Group.

To define Salary Details,

Go to Gateway of Tally > Payroll Info. > Salary Details

[Img-71]

Pay Structure for the

To speed up the entry of individual Employee’s Pay Structure you can define the
Employee Group with those Pay Heads which applies for most of the employees and copy the same to
individual employees.

If required, a Pay Head component or its value may be added, deleted or altered at Individual Employee
level. To define Salary Details for Employees referDefining Salary Details for an Employee.

Defining Salary details for Employee Group in Tally.ERP 9

To create Salary Details for an Employee Group,

Go to Gateway of Tally > Payroll Info. > Salary Details > Define

1. Select the Employee Group, e.g. Accounts in the Name field from the List of
Groups/Employees

2. In the Salary Details screen, specify the Date in Effective From field

3. In the Pay Head field, the Start Type list displays Two options namely, Copy From Employee
Copy From Employee Group, and Start Afresh

Note: If the Pay He ad de t ai ls are avai labl e i n other Empl oye e Group, the n the opti on Copy
From Em pl oyee Group w il l be displ aye d for se l ecti on.

If the opti on Al l ow C opy From Empl oyee is e nabl ed i n F12: Conf i gurati on , the n the
opti on C opy From Em pl oyee w ill be di spl aye d

 If you select Copy From Employee Group, the Salary Details defined for the Employee Group
will appear in the screen

 If you select Copy From Employee, the Salary Details defined for any Employee, irrespective of
Employee Group, can be selected

 If you select Start Afresh, you have to select the Pay Heads from the List of Pay Heads and enter
the values for the necessary Pay Heads, if required.

4. Select the Pay Heads from the List of Pay Heads

5. Enter the values in the Rate Column, if applicable

6. The Pay Head Type, Calculation Type and Calculated On fields display the details provided at the
Pay Head creation level

[Img-72]

7. Press Enter to accept and save.

Note: If you are usi ng any Pay He ad compone nt having Cal cul ati on Type: As Computed
Val ue and C om pute: O n C urrent Earni ngs Total the n w hi le de fini ng Sal ary De tail s, the
se que nce of the compone nt has to be se le cte d accordi ngl y.

Defining Salary Details for an Employee in Tally.ERP 9

To create Salary Details for an Employee,

Go to Gateway of Tally > Payroll Info. > Salary Details > Define

1. Select the Employee in the Name field from the List of Groups/Employees

2. Enter the Effective From date

3. In the Pay Head field, the Start Type list displays three options namely, Copy From
Employee, Copy From Parent Value and Start Afresh

Note: If the Pay He ad de t ai ls are avai labl e i n the pare nt group, the n the opti on Copy
From Parent Val ue w il l be di spl aye d for se le cti on.

If the opti on Al l ow C opy From Empl oyee is e nabl ed i n F12: Conf i gurati on , the n the
opti on Copy From Empl oye e w ill be di spl aye d.

 If you select Copy From Employee, the Salary Details defined for any Employee,
irrespective of Employee Group, can be selected.

 If you select Copy From Employee Group, the Salary Details defined for the Employee
Group will appear in the screen

 If you select Copy From Parent Value, the Salary Details defined for the Employee
Group to which the Employee belongs will appear in the screen

 If you select Start Afresh, you have to select the Pay Heads from the List of Pay Heads and
enter the values for the necessary Pay Heads, if required.

[Img-73]
Note: If the Pay He ad de t ai ls are avai labl e i n the pare nt group, the n the opti on Copy
From Parent Val ue w il l be di spl aye d for se le cti on, el se you wi ll ge t onl y Start Af resh .
If the opti on Al l ow C opy From Empl oyee is e nabl ed i n F12: Confi gurati on, the n the
opti on Copy From Empl oye e w ill be di spl aye d.

4. Modify values for the necessary Pay Heads as per Employees eligibility
[Img-74]

6. Press Enter to Accept and save.

Salary Details Configuration

Go to Gateway of Tally > Payroll Info. > Salary Details > Alter

1. Select the required Employee/ Employee Group from the List of Groups/Employees

2. Press F12: Configure

[Img-75]

 Allow to Override Slab Percentage: Set Allow to Override Slab Percentage to No to

prevent changes made to Slab Percentages. You can set it toYes, to override the
percentages already defined at the Pay Head Level

E.g. If you have defined Slab Rate for HRA as 40% in the Pay Head level, and if you wish to
change the Slab Rate percentage in the Salary details screen. Set Allow to Override Slab
Percentage to Yes in Salary details configuration screen and Tally.ERP 9 will allow you to
Override the percentage e.g. to 50% and so on. (Metro Cities & Non Metro Cities).

 Allow Copy From Employee: If you want copy the Salary Details of an employee who
belongs to a different Employee Group, set this option to Yes

 Show Pay Head Type: Set Show Pay Head Type to Yes to display if the Pay Head is an
Earning or a Deduction in the Salary Details screen

 Show Calculation Type: Set Show Calculation Type to Yes to display the method of
calculation adopted (As Computed Value, As User Defined Value, Flat Rate, On
Attendance or On Production

 Show Computed On: Set Show Computed On to Yes to display the Computation
Information (On Current Deductions Total, On Current Earnings Total, On Current Sub
Total, On Specified Formula)

Creating Attendance / Production Voucher in Tally.ERP 9 Payro

Attendance voucher allows you to enter Attendance, Overtime, Leave or Production details. You can enter separ
vouchers for each day or a single voucher for a given pay period, say a month, with aggregated values. You can also en
data for one or more or all employees. Similarly, one or more Attendance types together in a single voucher.

Attendance Voucher – Manual Entry

Go to Gateway of Tally > Payroll Vouchers > Ctrl+F5: Attendance

1. Click on F2: Date or press F2 to change the date

2. Select the Employee from the List of Employees

3. Select the Attendance/Production Type from the List

4. Enter the Value

5. Select End of List from the List of Employees

[Img-127]

6. Press Enter to Accept and save

Attendance Voucher using Auto Fill

In the Attendance Voucher, you can use the A: Payroll Auto Fill button to speed up data entry process.

Auto Fill enables the user to fill all employees of a selected Employee Category (if more than One Payroll Categor
enabled) and/or a selected Employee Group and enter data for selected type of Attendance/Production Type for th
employees.

Go to Gateway of Tally > Payroll Vouchers > Ctrl+F5: Attendance

1. Click on F2: Date or press F2 to enter the date

2. Click on A: Attd Auto Fill button or press Alt+A

3. Enter/Alter the Voucher Date, if required

4. Select the appropriate Employee Category

5. Select the Employee/Group from the List of Group/Employees

6. Select the Attendance/Production Type from the list

7. Enter the required number of days in the Default Value to Fill field (e.g. 0 days for absent and 26 days for
present etc.)
[Img-128]

8. In the Sort by field, select the Sorting Method based on which the Employee details will appear in the Voucher
Employee Name or Employee Number Only.

9. Enter the Value against the Employee Name

[Img-129]

8. Accept to save the Attendance Voucher.

Similarly, you can record the details for the Paid Leave, Overtime or Production using Attendance Auto Fill

F12: Configure

Click on F12: Configure or press F12 to change the default view for the Attendance Voucher
[Img-130]

 Skip Date field in Create Mode (faster entry!): Set this option to Yes to skip the Date selection
field for faster data entry. By default the Date of Last Entry will be taken as the Voucher Date

 Show Resigned / Retired Employees: Set this option to Yes to display the Resigned / Retired
employees also during the Voucher entry

 Show Balances as on Voucher Date: Set this option to Yes to display the Current Balance as per
the Voucher date for each Employee

 Show Employee Number: Set this option to Yes to display the Employee Number for
the employees during the Voucher entry

User Defined Pay Head Process in Tally.ERP 9 Payroll

The User Defined pay process is used for capturing the values for User Defined Pay Heads before
processing the actual Salary. This will result in correct salary computation at faster speed.

To process User Defined Pay Heads,

Go to Gateway of Tally > Payroll Vouchers > Ctrl + F4: Payroll

1. Press F2 to change the Voucher Date

2. Click A: Payroll Auto Fill or press Alt+A

3. Select the User defined in Process for field

4. Enter the From and To date

5. Select the appropriate Employee Category

6. Select the Employee/Group from the List of Employees / Group

7. Select the appropriate Payroll Ledger from the List of Ledger Accounts

8. Set Use Mode of Payment/Transaction Type to Yes. This will open a new option called
Mode of Payment/Transaction Type. Setting this option to Yes will allow user to filter
employees based on Banking details defined in employee's master.
o Select the appropriate Use Mode of Payment/Transaction Type

9. Set the option Set Employee-wise Bank Allocations to Yes

[Img-131]

8. Enter the User Defined Pay Head Values, e.g. Variable Pay, Salary Advance Deductions if any
etc.

9. Enter the required Narrations if any. The Payroll Voucher shows the Pay period by default in the
Narration field.
[Img-132]

10. Press Enter to save the voucher

Salary Process in Tally.ERP 9 Payroll

To process the Salary,

Go to Gateway of Tally > Payroll Vouchers > Ctrl + F4: Payroll

1. Press F2 to change the Voucher Date

2. Click A: Payroll Auto Fill or press Alt+A

3. Select the Salary in Process for field

4. Select Declared Value in the Compute Income Tax Based on field, to compute tax
based on declared amount

Note : To Compute Income Tax on the Proof amounts, se le ct Proof Val ue i n

the C om pute Incom e tax Based on fi el d.

5. Enter the From and To date

6. Select the appropriate Employee Category

7. Select the Employee/Group from the List of Employees / Group

8. Select the appropriate Payroll Ledger from the List of Ledger Accounts
[Img-133]
Note: If the Sal ary payme nt i s done through Cash, you can se le ct Cash as Payrol l
Ledger.

9. Enter the User Defined Pay Head Values, e.g. Variable Pay, Salary Advance Deductions if
any etc.

10. Enter the required Narrations if any. The Payroll Voucher shows the Pay period by default in
the Narration field.
[Img-134]

11. Press Enter to save the Voucher

Payroll Reports in Tally.ERP 9 Payroll

To view Payroll Reports,

Go to Gateway of Tally > Display > Payroll Reports

[Img-159]

The Payroll Reports menu displays:

 Statements of Payroll

 Attendance Sheet

 Attendance Register

 Expat Reports

 Statutory Reports

Note: The Statutory Reports opti on w i ll be di spl aye d onl y i f the Payrol l Statutory
Features i s e nable d.

Statements of Payroll in Tally.ERP 9 Payroll

To view the Statements of Payroll,

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll
[Img-160]

The Statements of Payroll menu displays:

 Pay Slip

 Pay Sheet

 Payroll Statement

 Payment Advice

 Payroll Register

 Employee Profile

 Employee Head Count Report

 Employee Pay Head Breakup

 Pay Head Employee Breakup

Pay Slip in Tally.ERP 9 Payroll
A Pay Slip is a document issued to an employee that lists each component of earnings and deductions,
and the net amount paid to an employee for a given pay period. It provides details on how the net
amount has been arrived at.

The Pay Slip option in Tally.ERP 9 facilitates the users to view the Pay Slip for individual Employees,
Configure the Content and Appearance based on the requirement and then Print or Email the Pay Slip.
Alternately, the user can also print or Email Pay Slips for all or selected Employees from the Pay Slip
Menu.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Pay Slip

[Img-161]

 Select Single Pay Slip and press Enter to view, print or Email Pay Slips for single
Employees.

 Select Multi Pay Slip and press Enter to print or email Pay Slips for all or selected
Employees.

 Select E-Mail IDs and press Enter to check the Email Exceptions report.

Single Pay Slip in Tally.ERP 9 Payroll

The Single Pay Slip option in Tally.ERP 9 facilitates the users to view the Pay Slip for individual
Employees, Configure the Content and Appearance based on the requirement and then Print or E-mail
the Pay Slip.

Go to Gateway of Tally > Display > Payroll Reports > Statements of Payroll > Single Pay Slip

 Select the Employee for whom you want to view the Pay Slip
[Img-162]

Configuration options in Pay Slip

Click on F12: Configure button in the Pay Slip to display a configuration sub-form, using which the user
can customise the display/printing content and appearance of the Pay Slip.

[Img-163]
The default settings for the configuration options are shown above. The options, which are set to Yes,
will become visible in the Pay Slip. Select No to exclude the information, which is not required to be
displayed on the Pay Slip.

 Show Vertical Pay Slip: Set this option to Yes to align Deduction Part below the Earning.
Set it to No to align them side-by-side.

 Show Employee Details: Set this option to Yes to display Employee Details as entered in
the employee master.

o Show Passport Details: Set this option to Yes to display the Passport Details.

o Show Visa Expiry Date: Set this option to Yes to display the Visa Expiry Date.

o Show Joining Date: Set this option to Yes to display the Employee Joining Date.

 Show Attendance/Production Details: Set this option to Yes to display

Attendance/Production data.

o Show Attendance/Production Groups: Set this option to Yes to display grouping of the
Attendance/production data as defined while Types creation.

 Display Production Type in Tail Units: For compound units used in

Attendance/Production Type, set this flag to Yes to display value of the
Attendance/Production Data in Tail unit and set the same to No to display data in Main unit.

 Show Year To Date values: Set this option to Yes to display cumulative value of
attendance/production data or Earning and Deduction data for the current Financial Year.

 Show Gross Salary: Set this option to Yes to display the Gross Salary details for each
component in the Salary Details.

o for Deduction's also: Set this option to Yes to display the Gross Salary Details for each
Deduction component.

 Show Employer Contribution to NPS: Set this option to Yes to display the employer's
contribution towards the National Pension Scheme.

 Remove Zero Entries: Set this option to Yes to remove Earning/Deduction data with Zero
value from the Pay Slip.

 For Attendance/Production Also: Set this option to Yes to remove Attendance data with
0 values from the Pay Slip.

 Appearance of Employee Names: You can select the appropriate appearance of name
from the Display Employee Name Style list.

 Appearance of Pay Head Names: Select the appropriate name style to appear for each
Pay Head in Pay Slip (i.e. Alias(Name), Alias only, Name(Alias), Name Only, Pay Slip
Name).

Button options in Pay Slip screen

F1: Detailed

Click on F1: Detailed button or press ALT+F1 to view source details of individual Attendance and Pay
Head values. This view displays the Attendance or Payroll vouchers from which the data is picked in the
current Pay Slip. Voucher Number, Date and the Value of the attendance or earning or deduction value
is displayed. This is useful when multiple attendance/payroll vouchers are entered during the same
payroll period. The user can drill down to the corresponding voucher directly from the Pay Slip screen.

Click the F1: Condensed button or press ALT+F1 again to return to the normal mode.

F2: Period

By default, when you bring up the Pay Slip view, the Period of Pay Slip - Attendance and
Payroll Vouchers data is set to current month, and in most cases you don’t have to change it.
However, if required, you can change the period of data and include multiple-period payroll information
to view/print a consolidated Pay Slip. As in all other Tally.ERP 9 reports, there is a great flexibility in
terms of Period of Payroll processing as well as in the printing of Pay Slip.

F4: Employee

Using Employee Button (F4 Key), you can view another employee’s Pay Slip from the existing Pay
Slip display screen.

Printing Single Pay Slip (Alt+P)

Click on Print button or Press Alt+P from the Pay Slip display screen to print currently displayed Pay
Slip. Tally.ERP 9 will print the Pay Slip in the format that is configured for display.

The Printing Pay Slip screen is displayed as shown:

[Img-164]

 Show Vertical Pay Slip: Set this option to Yes to print the Pay Slip in vertical format.

 Show Employee Details: Set this option to Yes to print the Passport, Visa and Joining
details as entered in the employee master.

 Show Passport Details: Set this option to Yes to print the employee’s passport details.

 Show Visa Expiry Date: Set this option to Yes to print the employee’s visa expiry date.

 Show Joining Date: Set this option to Yes to print the Joining date.

 Show Attendance/Production Details: Set this option to Yes to Print

Attendance/Production information

o Show Attendance/Production Groups: Set this option to Yes to print the grouping of the
Attendance/Production data as defined during the creation of Types.

 Display Attendance/Production Type in Tail Units: For compound units used in

Attendance/Production Type, set this option to Yes, to display the value of the
Attendance/Production details in the Tail unit. If this option is set to No, the Production
units will be printed in primary units.
 Show Year To Date values: Set this option to Yes to print the cumulative value of
Attendance/Production records and Earnings /Deductions for any given period.

 Show Gross Salary: Set this option to Yes by setting the Show Year To Date
values to No, to view Gross Earnings and Deductions for any given period.

o for Deduction's also: Set this option to Yes to display the Gross Salary Details for each
Deduction component.

 Show Employer Contribution to NPS: Set this option to Yes to print the employer's
contribution towards the National Pension Scheme.

 Remove Zero Entries: Set this option to Yes to remove the Earnings/Deductions
components with Zero value from the Pay Slip.

o For Attendance/Production also: Set this option to Yes to remove Attendance/

Production records with zero values from the Pay Slip.

 Appearance of Employee Names: Select the appropriate name style to appear in the Pay
Slip (i.e., Alias (Name), Alias only, Name (Alias), Name only).

 Show Authorised Signatory: Set this option to Yes to print the option for signature of
the Signing Authority. Set this option to No for printing the Pay Slip Note.

o Show Payslip Note: Set this option to Yes to print the Pay Slip Note as entered in
the Payroll Configuration screen.

 Show Payslip Message: Set this option to Yes to print the personalized Pay Slip
Message as entered in the Payroll Configuration screen. e.g. Happy New Year.

The printed Pay Slip with Gross Salary details is displayed as shown:
[Img-165]

E-Mailing Pay Slip (Alt+M)

Click on E-Mail button or press ALT+M from the Pay Slip display screen to Email the Pay Slip. Tally.ERP
9 gives flexibility of selecting the formats from ASCII, EXCEL, HTML and XML for E-Mailing as an
attachment or direct view.

The Mailing Pay Slip screen is displayed as shown:

[Img-166]

 Email Server: Select User Defined

 Server Address: Specify the Outgoing E-Mail server address and port number separated
by colon (:)

Note: If the outgoi ng E - Mai l se rve r i s confi gure d on any port othe r than 25, the n the
same nee ds to be spe ci fie d afte r the se rve r name wi th a col on. e.g.
sm tp.gm ai l .com :465

 Use SSL: By default this is set to No, change it to Yes if the E-Mail server is configured for
secured connection.

 From: By default name of the Company is displayed, which can be changed as per the
requirement.

 From E-Mail Address: By default the E-Mail address entered in the Company Master is
displayed. The user can change the same to the recent E-Mail address.

 Authentication Username and Password: Enter the required username and password in
case the E-mail server requires authentication, otherwise leave it empty.

 Format: Select the required emailing format from ASCII, Excel, JPEG, HTML, PDF, XML.
 Resolution: Select the required resolution, recommended is 1024 x 768.

 To E-Mail Address: By default the Employee E-Mail address as entered in the Employee
Master is displayed. This can be changed if required.

 CC To (if any): Provide an E-Mail address in case you want to send a copy of the same
mail to more than one recipient.

 Subject: By default, the Subject line is filled as Pay Slip, the user can re-enter the subject
as required.

 Additional Text if any: Enter a message for the recipient which will precede the Pay Slip
in the recipient’s mail program.

 Information sent: Select whether the Pay Slip needs to be sent as an Attachment or
for Direct Viewing in Mail.

 Specify the other parameters as explained in the above section (printing Pay Slips).

 Press Enter to send the mail.

For more instructions for completing the Mailing Pay slip screen, refer to E-mail a Report from
Tally.ERP 9.
Agenda

GST Concepts
Speaker:
Turab Haider
Terminologies use in GST
Team Attitude
Types of Return & e-filing Date
• e-filing GSTR return
B-2/19A,
Yamuna Vihar,
Delhi-110053
Contact:
011-43522158
GST (Goods and Services Tax) is a comprehensive tax levied on
supply of goods and services across India. GST (Goods and Services
Tax) is a Destination based Consumption tax, and the taxable event
Speaker: is Supply as against the existing taxable events of sale, manufacture
Turab Haider or provision of service.
Team Attitude
Draft model GST law was first made public in June 2016, after which
the Revised Draft Law was made public on 26th November 2016. It is
high time that businesses, industry/trade bodies, professional
B-2/19A,
associations and the like provide valid inputs at an early date, and
Yamuna Vihar,
ensure the final GST Law addresses all the concerns to make the
Delhi-110053
transition smooth.
Contact:
011-43522158
Speaker:
Turab Haider
Team Attitude

B-2/19A,
Yamuna Vihar,
Delhi-110053 Simple Tax Eliminates Technology Increase
Structure Cascading Effects Drive System Revenue
Contact:
011-43522158
Common threshold
limits across country Continuity of the tax
credit across the supply
Speaker: chain till it reaches the
Turab Haider Customer
Team Attitude Elimination of tax
cascading effect in the
supply chain

B-2/19A, PAN Biased Registration

Yamuna Vihar, ‘On supply’ tax liability
Delhi-110053 instead of ‘removal /
Contact: sale’
011-43522158
Valuation method
broadly as
‘Transaction Value’
Speaker:
Branch transfers
Turab Haider taxable and credit
Team Attitude eligibility
Tax credit eligibility on
inward supply of
goods/services for
B-2/19A, inter-state transaction
Yamuna Vihar,
No declaration forms
Delhi-110053
(form – C, F, H, etc…)
Contact:
011-43522158
Registration – Threshold Limit
Regular Dealer

Speaker: Special Category Aggregate

Turab Haider States* Turnover exceeds 10 Lakhs
Team Attitude

B-2/19A, Aggregate
Rest Of India
Yamuna Vihar, Turnover exceeds 20 Lakhs
Delhi-110053
Contact: Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkhim,
011-43522158 Tripura, Himachal Pradesh and Uttarakhand
Composition Levy
Composition Scheme

50 Lakhs Special
Composition Aggregate
category States
Speaker: Levy Turnover Does
& 75 lakhs for
not exceeds
Turab Haider rest of India
Team Attitude
• Not applicable for a taxable person engaged in:
• Supply of services except supply of food or drinks
for human consumption
• Supply of goods through an electronic
B-2/19A, Rate of tax:
commerce operator
Yamuna Vihar, Manufacturer : 2%
• Interstate outward supplies
Delhi-110053 • shall not collect tax Trader : 1%
Contact: • can not claim input tax credit Supplier of foods or drinks
011-43522158 • applicable for all transaction under the PAN for human consumption : 5%
Speaker:
Turab Haider
Team Attitude

B-2/19A,
Yamuna Vihar,
Delhi-110053
Contact:
011-43522158
Tax Likely to Be Subsumed under GST
CVD
VAT Purchase CST
Tax &
Excise ADE SAD
Duty
Luxury
Tax
Speaker: Entry
Turab Haider Surcharge Service Tax
& Cess Tax
Team Attitude Surcharge
& Cess

B-2/19A,
Yamuna Vihar,
SGST/
Delhi-110053 CGST UTGST
IGST
Contact:
011-43522158
Speaker:
Turab Haider
GST
Team Attitude

B-2/19A,
Yamuna Vihar,
SGST/
Delhi-110053 CGST UTGST
IGST
Contact:
011-43522158
Determination of GST- Intra State

Location Place
of Of
Supplier Supply
Speaker:
Turab Haider
Team Attitude
Delhi
Charge
B-2/19A, of
tax
Yamuna Vihar,
Delhi-110053 CGST Intra -State SGST
Contact:
011-43522158
Determination of GST- Inter State

Location Place
of Of
Supplier Supply
Speaker:
Turab Haider Charge
Team Attitude of
Delhi tax UP

Inter -State
B-2/19A,
Yamuna Vihar,
Delhi-110053
Contact:
IGST
011-43522158
Speaker:
Turab Haider
Team Attitude

B-2/19A,
Yamuna Vihar,
Delhi-110053
Contact:
011-43522158
Speaker:
Turab Haider
Team Attitude

B-2/19A,
Yamuna Vihar,
Delhi-110053
Contact:
011-43522158
Introduction To GST ( IGST , CGST,
SGST)

1. The GST would be applicable on the supply of goods or services or both as against the
present concept of tax on the manufacture and sale of goods or provision of services. It
will be a destination based consumption tax.

2. There will be a dual GST with the Centre and States simultaneously levying it on a
common tax base. The GST to be levied on intra-State supplies of goods and/or services
by the Centre will be Central GST (CGST) and that to be levied by the States will be the
State GST (SGST).

3. The GST to be levied on Inter-State Supply of Goods and Services and on import of
goods and services (in the place of CVD and SAD) is Integrated Goods and Services Tax
(IGST), which is equal to CGST plus SGST. It will be levied and collected by Centre under
IGST Act, 2017. Accounts would be settled periodically between the Centre and the
States to ensure that the SGST portion of IGST is transferred to the Destination State
where the goods or services are eventually consumed.

4. The GST would apply to all goods other than alcoholic liquor for human consumption and
five petroleum products, viz, petroleum crude, motor spirit (petrol), high speed diesel,
natural gas and aviation turbine fuel. It would apply to all services barring a few to be
specified.

5. Tobacco and tobacco products would be subject to GST. In addition, the Centre would
have the power to levy Central Excise duty on these products.

6. The GST would replace the following taxes currently levied and collected by the Centre:

a. Central Excise duty

b. Duties of Excise (Medicinal and Toilet Preparations)
c. Additional Duties of Excise (Goods of Special Importance)
d. Additional Duties of Excise (Textiles and Textile Products)
e. Additional Duties of Customs (commonly known as CVD)
f. Special Additional Duty of Customs (SAD)
g. Service Tax
h. Central Surcharges and Cesses so far as they relate to supply of goods and
services

7. State taxes that would be subsumed under the GST are:

a. State VAT
b. Central Sales Tax
c. Luxury Tax
d. Entry Tax (all forms)
e. Entertainment and Amusement Tax (except when levied by the local bodies)
f. Taxes on advertisements

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g. Purchase Tax
h. Taxes on lotteries, letting and gambling
i. State Surcharges/Additional Taxes and Cesses so far as they relate to supply of
goods and services
8. There are 5 tax rate slabs decided by the GST council 5%, 12%, 18% and 28%. In
addition Cess will be levied by the Centre on certain commodities.

9. The list of exempted goods and services will be common for the Centre and the States.
10. Tax payers with an aggregate turnover in a financial year up to 20 lakhs would be
exempt from tax. [Aggregate turnover shall include the aggregate value of all taxable
and non-taxable supplies, exempt supplies and exports of goods and/or services and
exclude taxes under the Act viz. GST.] Aggregate turnover shall be computed on all
India basis. For North East States and Sikkim, the exemption threshold shall be [ 10
lakhs]. All tax payers eligible for threshold exemption however, shall have option of
paying tax and avail input tax credit (ITC) benefits.

The tax payers making inter-State supplies or paying tax on reverse charge basis shall
not be eligible for threshold exemption. In other words, The traders supplying goods to
other states will need to register under the Goods and Services Tax (GST) even if their
turnover is below Rs 20 lakh. "Rs 20 lakh registration limit is only for intra-state traders,"

11. The traders, who have turnover below Rs 20 lakh and supply goods and services within
the state, can also go for voluntary registration to avail input tax credit

"But once registered, the traders will have to pay taxes on all supplies, even if turnover
is less than Rs 20 lakh,".

Even if there were no transactions in a certain month, return would have to be filed once
registration was done

12. Small tax payers with an aggregate turnover in a financial year up to 75 lakhs shall be
eligible for composition levy. Under the scheme, a tax payer shall pay tax as a
percentage of his turnover during the year without the benefit of ITC. The floor rate of
tax for CGST and SGST shall not be less than [1%]. A tax payer opting for composition
levy shall not collect any tax from his customers. The composition scheme is optional.
The eligible taxpayers shall have the option of switching over as a regular tax payer and
thereby paying tax with ITC benefits. Taxpayers making inter-State supplies or paying
tax on reverse charge basis shall not be eligible for composition scheme.

13. Tax payers shall be allowed to take credit of taxes paid on inputs (Input Tax Credit -
ITC) and utilize the same for payment of GST on outward supplies. However, no input
tax credit on account of CGST shall be utilized towards payment of SGST and vice
versa. The credit of IGST would be permitted to b utilized for payment of IGST, CGST
and SGST in that order. ITC of cess may be utilised for payment of cess only.

14. HSN (Harmonized System of Nomenclature) Code shall be used for classifying the
goods under the GST regime.

15. Exports shall be treated as zero-rated supply. No tax is payable on export of goods or
services but credit of the input tax related to the inward supply of inputs and input

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services attributed to supply of such export of goods/services shall be admissible to
exporters and the same can be claimed as space refund by them. In case export is
made on payment of Tax, refund of such tax shall be given to the exporters.

16. Import of goods and services would be treated as inter-State supplies and would be
subject to IGST in addition to the applicable customs duties. The IGST paid shall be
available as ITC for further transactions.

17. The laws, regulations and procedures for levy and collection of CGST, UTGST, IGST
and SGST has been harmonized to the extent possible.

18. GSTIN will be in the format as specified below, which shall have a checksum digit to
locate and process several data based on this unique identification number of the
taxpayer, for different business processes like populating data in the domain of
connected taxpayers, managing mismatches at item level of supply and purchase data,
fund settlement etc.

Entity Check
State Code PAN
Code Digit
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

19. Accordingly, before filing of GSRT-3 following procedure may be followed for
rectification and finalization of returns :

21. A registered taxpayer, who is registered under the Composite Scheme will pay tax at a
rate not more than 1% for manufacturer, 2.5% for restaurant sector and 0.5% for other
suppliers of turnover.

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22. Credit of CGST paid on inputs may be used only for paying CGST on the output. Credit
of SGST paid on inputs may be used only for paying SGST on the output.

o ITC of CGST allowed for payment of CGST.

o ITC of SGST allowed for payment of SGST.

o ITC of CGST allowed for payment of CGST & IGST, in that order.

o ITC of SGST allowed for payment of SGST & IGST, in that order.

 ITC of IGST allowed for payment of IGST, CGST & SGST, in that order

Calculation Of GST ( IGST, CGST &

SGST)

For PURCHASE & PAYMENT : IGST CGST SGST

For Transaction 1 : GST paid to party on
assessable value of Rs.4,000 @ 18 % GST is 360 360
Rs. 720
For Transaction 2 : GST paid to Party on the
assessable Value of Rs. 40,000 @ 28% GST is 5600 5600
Rs. 11,200
For Transaction 3 : IGST paid on the
assessable Value of Rs. 90,000 @ 18% GST is
18600
Rs. 16,200 & Rs. 20,000 @ 12% GST is Rs.
2,400 [ 16200+2400]
Total of Input GST [ IGST, SGST & CGST] 18600 5960 5960

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For SALES :
For Transaction 6 : GST received from Party
on assessable value of Rs. 7,500 @ 18% GST 675 675
Rs. 1350
For Transaction 7 : GST received from Party
on assessable value of Rs. 45,000 @ 28 % GST 6300 6300
Rs. 12600
For Transaction 8 : GST received on the
assessable Value of Rs. 1,00,000 @ 18% GST 9000 9000
is Rs. 18,000.
For Transaction 9 : IGST received on the
assessable Value of Rs. 30,000 @ 12% IGST is 3600
Rs.3600 for sale outside State.
Total Output GST [ IGST, SGST & CGST] 3600 15,975 15,975

TABLE OF GST ADJUSTMENT :

Particulars IGST CGST SGST

Output GST Liability 3600 15,975 15,975
Less : Input GST Credit
Input CGST 5960
Input SGST 5960
Input IGST 3600 10015 4985
Amount Payable i.e SGST only NIL NIL 5030

Any IGST credit will first be applied to set off IGST and then CGST.
Balance if any will be applied to setoff SGST.
So out of total input IGST of Rs. 18,600, firstly it will be completely setoff against IGST i.e.
3600. Then balance Rs.15,000 against CGST i.e. Rs. 10015 and remaining Balance of Rs.
4985 against SGST
From the total Output GST Rs.35,550, only Output SGST of Rs. 5030 is payable.
So the Set-Off Entries will be -
1. Setoff against CGST Output
Output CGST A/c Dr. ……… 15975
To Input CGST A/c 5960
To Input IGST A/c 10015
2. Setoff against SGST Output
Output SGST A/c Dr. ……… 15975
To Input SGST A/c 5960
To Input IGST A/c 4985

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To Output SGST Payable A/c 5030
3. Setoff against IGST Output
Output IGST A/c Dr. ……… 3600
To Input IGST A/c 3600
4. Final Payment of Output SGST Payable of Rs. 5030
Output SGST Payable A/c Dr. ……… 5030
To Bank A/c 5030

Acticating GST for your Company in

Tally.ERP9

To use Tally.ERP 9 for GST compliance, you need to activate the GST feature. Once activated,
GST-related features are available in ledgers, stock items, and transactions, and GST returns
can be generated.
To activate GST
1. Open the company for which you need to activate GST.
2. Press F11 > F3.

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3. Enable Goods and Services Tax (GST) - Yes.
4. Set/alter GST details - Yes.

State: Displays the state you have selected for your company. Helps in identifying local and
interstate transactions. If you change the state, it will be updated in the company details

Purchase from Unregistered Dealers under

Reverse Charge in GST in Tally.ERP9
Under reverse charge, you can account for taxable purchase of goods from unregistered dealers

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(URD), purchases against advance paid, cancellation of purchase after advance payment, and
purchase returns. The transaction details are captured in GSTR-3Breport.
To record purchases from an unregistered dealer, you need to
1. Updating your party ledgers
2. Recording a purchase invoice
3. Recording a journal voucher to raise the tax liability
4. GST payment voucher for paying liability under reverse charge
5. Claim tax credit on reverse charge liability raised
1. Updating your party ledgers
You need to identify the party as an unregistered dealer.

To update your party ledger

1. Go to Gateway of Tally > Accounts Info. > Ledgers > Alter > select the ledger.

2. Set/alter GST details? - Yes.

3. In GST Details screen, Registration Type - Unregistered.

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4. Press Ctrl+A to save.

2. Recording a purchase invoice

To record a purchase entry
1. Go to Gateway of Tally > Accounting Vouchers > Accounting Vouchers > F9: Purchase.
2. Enter the details as required.

Link the bill reference of the payment voucher (by selecting Agst Ref in the Bill-wise
Details screen) to the purchase invoice, if you have made an advance payment.
3. Click A: Tax Analysis > F1: Detailed to view the detailed Tax Analysis report that displays the
reverse charge amount.

4. Press Escape (Esc) to go back to the purchase voucher.

5. Press Ctrl+A to save.

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3. Recording a journal voucher to raise the tax liability
You can view the liability payable on purchase from unregistered dealers for each tax period in
the Purchase from URD - Reverse Charge Liability report of GSTR-3B.

To record a journal voucher to raise the liability

1. Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR-3B > R: Show URD
Purc. You can raise the tax liability for the amount shown in this report.

2. Click J: Stat Adjustment.

3. Select the options as shown below.

4. Click F2: Date and change the voucher date as required.

5. Debit the expense ledger or ledger grouped under Current Assets and credit the GST ledgers.

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6. Press Enter to save.

4. GST payment voucher for paying liability under reverse

charge
To record a tax payment voucher
1. Go to Gateway of Tally > Accounting Vouchers > F5: Payment.

2. Click S: Stat Payment and enter the required details.

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Payment Type: Set the type of payment as Recipient Liability.
3. Account: Select the bank from which the payment will be made.
4. Select the central and state tax ledgers.
5. Provide GST details: Enable this option to enter the bank details.

If the bank details are not available, you can enter them later in the Challan Reconciliation report.
6. In the Bank Allocations screen, select the ledgers, enter the amount and provide the payment
details.
7. Press Enter to save.

5. Claim tax credit on reverse charge liability raised

To claim tax credit
1. Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR-3B > R: Show URD
Purc. You can claim tax credit for the amount shown as Liability booked in this report.

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2. Click J: Stat Adjustment.
3. Select the options as shown below.

4. Debit the GST ledgers and enter the amount of tax credit.
5. Credit the expense ledger, or ledger grouped under Current Assets.

6. Press Enter to save.

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HSN/SAC Summary Report in Tally.ERP9
HSN/SAC Summary report contains the details of HSN/SAC-wise taxable value and tax amount
that needs to be filed along with GST returns. The HSN Summary in the GSTR-1 report of
Tally.ERP 9 provides HSN/SAC-wise details of all outward supplies. GSTR-2 provides HSN/SAC-
wise details of all inward supplies.
To view HSN/SAC summary of outward supplies
1. Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR-1 or GSTR-2.
2. Click N: HSN/SAC Summary in the GSTR-1 report. The HSN/SAC Summary report
appears.

Description: Displays the description specified for the HSN/SAC.

HSN/SAC: Displays the HSN code or SAC of the good or service.
Type of Supply: Display the Type of Supply selected for the HSN/SAC.
Quantity UOM: Displays the quantity supplied for the period using the defined unit of
measurement.
Taxable Value: Displays the consolidated taxable value from all the transactions in the period for
the HSN/SAC.
Integrated Tax Amount: Displays the consolidated integrated tax amount from all the interstate
transactions in the period for the HSN/SAC.

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Central Tax Amount: Displays the consolidated central tax amount from all the interstate
transactions in the period for the HSN/SAC.
State Tax Amount: Displays the consolidated state tax amount from all the interstate
transactions in the period for the HSN/SAC.
Cess Amount: Displays the consolidated cess tax amount from all the interstate transactions in
the period for the HSN/SAC.
Total Tax Amount: Displays the total tax amount from all the interstate transactions in the period
for the HSN/SAC.
Drill down from any HSN/SAC to view the list of transactions.

F12: Configure
View Summary of: This option enables you to view report with values for only goods or services
or both.
View vouchers based on HSN/SAC: This option enables you view the report with values of
goods or services that have HSN/SAC information or without these details or both.

FAQ @ Recording Transactions under GST

in Tally.ERP9
1. How to record expenses incurred in the furtherance of business like rent, telephone

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expenses, stationery and so on, and claim them under GST?
Expenses incurred for the furtherance of business, such as rent (commercial), telephone bill,
stationery and so on, can be claimed under GST by recording them as purchases and not as
expenses. To record such purchases, create a party ledger (party from whom such goods are
procured) and ensure that GSTIN of the party is updated in the ledger. When the supplier uploads
his GSTR-1, the details will appear in your GSTR-2A. You can claim input credit by confirming the
same in your GSTR-2.
2. How do I account for consignment sales?
Consignment sales is similar to other sales under GST. You can record the sales invoice with GST
ledgers (if it is taxable), and record a tax payment voucher to pay tax.
3. How to make stock transfer entry between two godowns of same organisation inside the
state and outside the state?
Under the GST regime, stock transfer to a godown or to an entity with a different GSTIN registration
is considered taxable supply. Hence, if stock is transferred to a godown of the same organisation, it
is recorded as a transfer if the godown is operating under the same GSTIN. In case the godown has
a different GSTIN, it is recorded as an taxable outward supply. You can record transfers using
delivery note or material out voucher types, and taxable outward supplies using sales vouchers in
Tally.ERP 9.
In case of supply to a godown outside the state, it is recorded as a taxable outward supply, since the
same GSTIN cannot be used for business operations in two different states.
4. How to account for works contract sales and purchases?
Works contract is treated as a service under GST. The works contract purchases and sales have to
be recorded as taxable purchases and sales. Based on the State in which the party is located, you
can select the taxable Nature of transactions provided for sales and purchases, and the GST
ledgers in the invoice.
5. How to maintain transactions of job work under GST?
You can manage your job work entries using the existing features of job work in Tally.ERP 9. When
the GST rules related to job work are finalised, necessary changes will be incorporated, and made
available in Tally.ERP 9.
6. How to record inclusive-of-tax transactions?
In Tally.ERP 9 Release 5.0 and later versions, recording inclusive-of-tax transaction is simplified.
Earlier you had to create a voucher class with inclusive-of-tax percentages to record inclusive-of-tax
transactions.
Now, this can be done by enabling the option Allow entry of rate inclusive of tax for stock item?
under F12: Configure in sales or purchase invoice.
To record an inclusive-of-tax transaction
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.
2. Click F12: Configure and enable the option Allow entry of rate inclusive of tax for stock
item?
The column Rate (Incl. of Tax) appears in the invoice.

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Rate (incl. of Tax): Enter the rate of the item including tax in this column. The actual rate will appear
in the Rate column. The tax amount will appear automatically on selecting the tax ledgers.

Table-wise View in the GSTR-1 Report in

TallyERP9
GSTR-1 report can be viewed in the table-wise format. The table-wise report is structured in line
with the GSTR-1 format given by the department.
To view the report in table-wise format
● Click V: Table-wise View in the GSTR-1 report.

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By default the table-wise format displays rows related to values for current reporting period. And
rows of previous period amendments, if values are available. To view all the amendment rows,
enable the option Show amendment tables with zero values? under F12: Configure.

Given below is the description of different tables.

Table name Description

5 B2B invoices Displays the taxable value and tax amount from taxable supplies to a
registered person recorded in the reporting period. The transactions
recorded with
Nature of transaction as
● Sales Taxable
● Interstate Sales Taxable
● Sales Exempt
● Interstate Sales Exempt
● Sales Nil Rated
● Interstate Sales Nil Rated
Taxability as

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● Taxable
● Exempt
● Nil Rated
Registration type as
● Regular
● Composite
● Unknown (with GSTIN)

5A Amendments to Displays amendments to details of outward supplies to a registered person

B2B Invoices of earlier tax periods.

6 B2C(Large) Displays taxable value and tax amount from taxable outward supplies to a
Invoices consumer where place of supply is other than the state where supplier is
located (Inter-state supplies) and invoice value is more than Rs 2.5 lakh.
The transactions recorded with,
Nature of transaction as
● Interstate Sales Taxable
● Interstate Sales Exempt
● Interstate Sales Nil Rated
Taxability as
● Taxable
● Exempt
● Nil Rated
Registration Type as
● Unregistered
● Consumer
● Unknown (with GSTIN)

6A Amendments to Displays amendments to details of taxable outward supplies to a consumer

B2C(Large) Invoices where place of supply is other than the state where supplier is located
(Inter-state supplies) and invoice value is more than Rs 2.5 lakh of earlier
tax periods.

7 B2C(Small) Displays taxable value and tax amount from taxable outward supplies to
Invoices consumer (Other than captured in table 6). The transactions recorded with
Nature of transaction as:
· Interstate Sales Taxable
· Interstate Sales Exempt
· Sales Taxable
· Sales Exempt
· Sales Nil Rated

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· Interstate Sales Nil Rated
· Sales to Consumer – Taxable
· Sales to Consumer – Exempt
Taxability as:
· Taxable
· Exempt
· Nil Rated

Registration Type as:

· Unregistered
· Consumer
· Unknown (with GSTIN)
and invoice value of less than 2.5 lakhs are captured in this table.

7A Amendments to Displays amendments to details of taxable value and tax amount from
B2C(Small) Invoices taxable outward supplies to consumer (Other than captured in table 6) of
earlier tax periods.

8 Credit/Debit Notes Displays the taxable value and tax amount from credit and debit notes
recorded in the reporting period. The credit and debit note transactions
recorded with
Nature of transaction as
● Interstate Sales Taxable
● Interstate Sales Exempt
● Interstate Sales Nil Rated
● Sales Taxable
● Sales Exempt
● Sales Nil Rated
Taxability as
● Taxable
● Exempt
● Nil Rated
Registration type as
● Regular
● Composite
● Unknown (with GSTIN)

8A Amendments to Displays amendment to details of credit and debit notes of earlier tax
Credit/Debit Notes periods.

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9 Nil Rated Invoices Displays the taxable value from nil rated, exempt and non-GST outward
supplies. The transactions recorded with,
Nature of transaction as
● Sales Exempt
● Interstate Sales Exempt
● Sales Nil Rated
● Interstate Nil Rated
Taxability as
● Taxable
● Nil Rated
Registration type as
● Regular
● Composite
● Consumer
● Unregistered
● Unknown (with GSTIN)
and, Is Non-GST good? option enabled.

10 Exports Invoices Displays the taxable value and tax amount from supplies exported
(including deemed exports) in the reporting period. The transactions
recorded with,
Nature of transaction as
● Exports Taxable
● Exports - LUT/Bond
● Exports Exempt
● Deemed Exports Taxable
● Deemed Exports Exempt
● Sales to SEZ - Taxable
● Sales to SEZ - Exempt
● Sales to SEZ - LUT/Bond
Taxability as
● Taxable
● Exempt
● Nil Rated
Registration type as
● Composite
● Consumer

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● Unregistered
● Unknown

10A Amendments to Displays details of amendments to supplies exported of earlier tax periods.
Exports Invoices

11 Tax Liability on Displays tax liability arising on account of time of supply without issuance
Advances of invoice in the same period. The tax amount credited in the receipt
transactions recorded by using the option Advance Receipt are captured
in this table.

11A Amendments to Displays details of amendments to tax liability arising on account of time of
Tax Liability on supply without issuance of invoice in the same period.
Advances

12 Setoff of Tax Displays tax already paid (on advance receipt/ on account of time of
Paid against supply) on invoices issued in the current period. Displays the tax amount
Advances from sales transactions for which tax liability was created in advance
receipts recorded in previous period.

Using Multiple addresses for Ledger

To use multiple addresses for ledgers

1. Go to Gateway of Tally > Accounts Info > Ledgers > Create. The Ledger Creation screen
appears.
2. Click F12: Configure. The Master Configuration screen appears.
3. Set the option Use MULTIPLE Addresses to Yes.

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4. Click Enter to save the configuration and go to the Ledger Creation screen.
Note: The option Use Multiple Addresses can also be enabled from Gateway of Tally > F12:
Configure > Accts / Inventory Info.
5. Type the name of the Party in the Name field (E.g. Supplier A).
6. Select the group from the List of Groups (E.g. Sundry Creditors).
7. Set the option Set/Alter Multiple Mailing Details to Yes.

8. Press Enter.
9. The Address Type screen for the ledger being created appears.
10. Type the name of the Party’s Location (E.g. Supplier A WH-1).

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11. Press Enter. The Mailing Details screen appears.
12. Enter the Mailing Name, Address, State, PIN Code, and the Statutory & Taxation
Information in the respective fields provided. The filled Mailing Details screen appears as shown:

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Use Multiple Addresses in Transactions

To select an address type in transactions
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.
2. Select the required Date, type the Supplier Invoice No. and Date.
3. Select the party ledger in the field Party's A/c Name. The Supplier's Details screen displays
the Primary Address.
4. In the Address Type field of Consignee, select the required address type of the Company (E.g.
Branch Office) as shown:

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5. Press Enter.
6. In the Address type field of Supplier, select the required Address Type.

7. Press Enter.
Note: Enable the option Allow Separate Buyer and Consignee Names in F12: Configure to

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enter Consignee details.
8. The Supplier’s Details screen after selecting the required Address Type appears as shown:

9. Press Enter.
10. Select the Purchase ledger.
11. Select the Item, Quantity, and Rate.
12. Press Enter.
13. Press Ctrl+A to save the transaction.

Using Multiple addresses for Ledger

Account in Tally.EP9
You can create a single ledger with multiple addresses and record their statutory details thus
avoiding creation of ledgers for each location. This can be done by configuring the use of
multiple addresses in the required party ledger and specifying the different addresses. The
address required can be selected from the defined addresses during transaction entry.
To use multiple addresses for ledgers
1. Go to Gateway of Tally > Accounts Info > Ledgers > Create. The Ledger Creation screen
appears.
2. Click F12: Configure. The Master Configuration screen appears.
3. Set the option Use MULTIPLE Addresses to Yes.

4. Click Enter to save the configuration and go to the Ledger Creation screen.
Note: The option Use Multiple Addresses can also be enabled from Gateway of Tally > F12:

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Configure > Accts / Inventory Info.
5. Type the name of the Party in the Name field (E.g. Supplier A).
6. Select the group from the List of Groups (E.g. Sundry Creditors).
7. Set the option Set/Alter Multiple Mailing Details to Yes.

8. Press Enter.
9. The Address Type screen for the ledger being created appears.
10. Type the name of the Party’s Location (E.g. Supplier A WH-1).

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13. Press Enter, the Address Type screen appears.
14. Enter another Address Type name to create the required Mailing Details.
15. Press Enter, the Ledger Creation screen appears.
16. Press Ctrl+A to save the ledger.
Use Multiple Addresses in Transactions
To select an address type in transactions
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.
2. Select the required Date, type the Supplier Invoice No. and Date.
3. Select the party ledger in the field Party's A/c Name. The Supplier's Details screen displays
the Primary Address.
4. In the Address Type field of Consignee, select the required address type of the Company
(E.g. Branch Office) as shown:

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5. Press Enter.
6. In the Address type field of Supplier, select the required Address Type.

7. Press Enter.
Note: Enable the option Allow Separate Buyer and Consignee Names in F12: Configure to
enter Consignee details.
8. The Supplier’s Details screen after selecting the required Address Type appears as shown:

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9. Press Enter.
10. Select the Purchase ledger.
11. Select the Item, Quantity, and Rate.
12. Press Enter.
13. Press Ctrl+A to save the transaction.

Create A Voucher Class for Inclusive of Tax

Calculations in Tally.ERP9
Voucher class can be used to automatically apply GST in transactions. You can create voucher
class for inclusive-of-tax calculation as well as exclusive. The value of additional ledgers in the
transaction should be included in the taxable value for calculating tax, which can also be
automated using voucher class.
By creating voucher class with default tax ledgers and percentages, the errors that may arise due
to the selection of wrong tax ledgers in the transactions can be avoided. It also reduces the time
of voucher creation.

Voucher Class with Inclusive of Tax

In an inclusive voucher class, the tax amount is included in the sales value. Given below is the
illustration of inclusive of tax voucher class under sales voucher type.
The sales ledger value and tax value are defined as percentage of the total sales value.

To create inclusive of tax voucher class

1. Go to Gateway of Tally > Accounts Info > Voucher Types > Alter > Sales. Specify the
details of the class as below:

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Now pass a sales invoice using the voucher class created. The default account allocations
selected in the voucher class will be automatically applied in the invoice. The invoice will not
display the value of the default ledgers.

The auto-calculated value for the default ledgers can be viewed in the alteration mode. Open
the invoice in alteration mode, and press Enter from the field Amount.

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Voucher class without inclusive of tax
In a tax-exclusive voucher class, sales ledger and tax ledger percentages are exclusively
defined.

As in tax-inclusive voucher class, the tax values will be applied automatically in the invoice. There

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is no need to select the tax ledgers.
You can create multiple voucher class for different tax rates or tax types depending on your
requirement.

Creating Voucher Types in Tally.ERP9

You can customise the voucher by creating a voucher class.
To create a voucher type
1. Go to Gateway of Tally > Accounts Info. or Inventory Info. > Voucher Type > Create.
2. Enter the Name of the voucher.
3. Select the type of voucher.
4. Enter the abbreviation in the Abbreviation field, if required.
5. Select the Method of voucher numbering from the Methods of Numbering list, which appears
as shown below:

Click here for more information about the Methods of Numbering available.
6. Enable Use effective dates for vouchers to enter effective dates for vouchers.
Note: Select this option if you have a transaction under consideration for overdue/ageing analysis
recorded currently but will come into effect on another date. If the effective date is entered, the
overdue/ageing will be considered from the effective date and not from voucher date.
7. Enable Make this voucher type 'Optional' by default to set your voucher to optional voucher
by default.
Note: For Memorandum and Reversing Journal voucher the option Make this voucher type
'Optional' by default is not available.
8. Enable Allow narration in voucher to give a common narration for voucher. A common
narration screen for voucher appears as shown below:

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9. Enable Provide narration for each ledger in voucher ? if you want to give a separate narration
for each entry of a voucher. This would be applicable for a multiple entry voucher where you want
separate details for each entry. The narrations for each entry appears as shown below:

For Delivery Note, Receipt Note, Sales order, Purchase order, Physical Stock, Stock Journal,

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Rejection In and Rejection Out, the option Provide narration for each ledger in voucher ? is not
available.
10. Enable Print voucher after saving to print every voucher after entering it.
Note: Depending on the Type of Voucher selected to create or alter, different printing features
appear in this field. For example, if you select Receipt as Type of Voucher, the option Print Formal
Receipt after saving will be displayed.
11. Set Use for POS invoicing to Yes to use the sales invoice as POS invoice.
12. Set the Default title to print on invoice to print the same title for POS invoice.
Note: Default print Title option will appear only in Sales Voucher Type.
13. Select the bank in Default bank option to print the default bank ledger when the option Print
Bank Details is enabled in a Sales voucher.
14. Enter the Default jurisdiction to be printed on the invoice, if required.
15. Create a voucher class in the Name of Class field, if required.
The completed Voucher Type Creation screen appears as shown below:

16. Press Enter to save.

Stock Journal Voucher Type

While creating a Stock Journal Voucher Type, the option Use Manufacturing Journal is enabled.
The Voucher Type Creation screen appears as shown below:

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Restarting Voucher Numbering in
Tally.ERP9
You can restart the numbering of your vouchers by creating a new voucher type and specifying the
applicable dates, prefix, suffix, and other details, as needed.
Note: In order to be GST-compliant, the voucher numbers of your invoice have to be unique and
continuous. You can continue to use your existing series of voucher numbers. For your convenience,
you can prefix and suffix your voucher numbers with GST-specific information. You can also choose
to restart voucher numbering by creating a new voucher type for GST.

To create a new voucher type

● Go to Gateway of Tally > Accounts Info. > Voucher Types > Create.

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Method of Voucher Numbering? - Automatic (Manual Override). By selecting this option, you
can auto-number your vouchers and also manually override the auto-numbering when required.
Prevent duplicates? - Yes, to ensure unique voucher numbers.
Use advanced configuration? - Yes, to open the Voucher Type Creation (Secondary) screen.

Starting Number - 1, if you want a fresh batch of voucher numbers.

Prefix Details, Suffix Details - Here you can enter details specific to your transactions, as required.
Now you can easily record your transactions with a new series of voucher numbers.
According to the details entered in the screen above, the sales voucher will appear as shown below:

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Similarly, if you want to create invoices to track reverse charge transactions for unregistered dealers,
create a new voucher type with a separate series of voucher numbers and record the purchase
invoices. In the Voucher Printing screen, you can click F12: Configure and set the options as
required to print the self-invoice.

GSTR-2 Summary of Exceptions Reports in

Tally.ERP9
Vouchers with incomplete/mismatch in information list includes voucher that contain GST
details but are not included in the count of Included in returns and Not relevant for returns due to
incomplete information or mismatch.
You can correct exceptions in the vouchers before exporting GST returns. The Vouchers with
incomplete/mismatch in information report for GSTR-2 appears as shown below:
1. No. of voucher with incomplete/mismatch in information
2. Country, state and dealer type not specified
3. Tax rate/tax type not specified
4. Nature of transaction, taxable value, rate of tax modified in voucher
5. Incorrect tax type selected in tax ledger
6. Mismatch due to tax amount modified in voucher
7. Voucher with incomplete/incorrect adjustment details (GSTR-2)

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1. No. of voucher with incomplete/mismatch in

information
Displays the count of total vouchers with exceptions. Drill down from this row to view all the
vouchers with exceptions, number of exceptions in each voucher, and type of exception. All
exceptions can be resolved from here without having to open different exception categories.
To resolve all exceptions without having to go from one exception type
to another
1. Select No. of voucher with incomplete/mismatch in information.
2. Press Enter to display Exception Resolution screen with the list of vouchers, number of
exceptions in each voucher, and exception types. The Exception Resolution screen appears as
shown below:

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3. Select any transaction and press Enter to display the Voucher Details Alteration screen which
is divided into multiple sections, one for each exception in the voucher, as shown below:

4. Select or enter required information for the first exception type. Further, you can click F5:
Recompute or A: Accept as is to recompute or accept the details, respectively.

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5. Press Enter to navigate to next exception type.
6. Resolve the exceptions by providing details or using the buttons provided.
7. Press Enter after all exceptions in the voucher are resolved to view the next voucher with
respective exceptions.
8. Continue resolving the exceptions voucher by voucher, or press Esc to return to Exception
Resolution screen.
Note: Click X: Exclude Vouchers in the Exception Resolution screen to exclude the voucher from
GSTR-2 return.

2. Country, state and dealer type not specified

Displays the count of transactions where,
● Country/state is not selected in the party ledger master,
● State selected in transaction and party ledger are different, or
● Nature of transaction is not derived.
To resolve this exception
1. Select the exception Country, state and dealer type not specified.
2. Press Enter. All the transactions of the exception type are displayed. The Exception
Resolution screen appears.

3. Select the state, specify the GSTIN and select dealer type for each transaction.
4. Press Ctrl+A to accept.
Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-2 return.

3. Tax rate/tax type not specified

Displays the count of transactions for which the rate or tax type is not selected in the item/ledger
master.

To resolve this exception

1. Select the exception Tax rate/tax type not specified.
2. Press Enter. All the transactions of the exception type are displayed. The Exception
Resolution screen appears as shown below:

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3. Select the Nature of transaction, if not provided.
4. Enter Rate Details, as required for each transaction.
5. Press Enter to save.
Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-2 return.

4. Nature of transaction, taxable value, rate of tax

modified in voucher
Displays count of transactions in which the Nature of transaction, taxable value or rate of tax
defined in the ledger master has been changed in the transaction.
To resolve this exception
1. Select the exception Nature of transaction, taxable value, rate of tax modified in voucher.
2. Press Enter. All the transactions of the exception type are displayed, as shown below:

3. Select the required voucher.

4. Click R: Resolve to select Nature of transaction and enter other details manually, or click A:
Accept as is. When you accept the voucher as is, a message is displayed as shown below:

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5. Press Enter to accept.
6. Similarly, accept the required vouchers.
7. Press Ctrl+A to accept.

5. Incorrect tax type selected in tax ledger

Displays count of transactions in which type of duty is invalid.
To resolve this exception
1. Select the exception Incorrect tax type selected in tax ledger.
2. Press Enter. All the transactions of the exception type are displayed, as shown below:

3. Select the GST ledgers for each transaction.

4. Press Enter to save.

6. Mismatch due to tax amount modified in voucher

Displays the count of transactions in which difference is found between the calculated and entered
tax amount. The mismatch due to modified value can be resolved by following one of the options.

Recompute
To resolve this exception

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1. Select the exception Mismatch due to tax amount modified in voucher.
2. Press Enter. All the transactions of the exception type are displayed.

3. Navigate to required transaction and press Enter.

4. Click F5: Recompute to recalculate the tax amount.

5. Press Ctrl+A to accept.

Resolve
To resolve this exception
1. Select the exception Mismatch due to tax amount modified in voucher.
2. Press Enter. All the transactions of the exception type are displayed.
3. Select the required transaction.
4. Click R: Resolve, and enter the tax value in As per transaction column of the voucher.
The Exception Resolution screen appears as shown below:

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5. Press Ctrl+A to accept.

Accept as is
To resolve this exception
1. Select the exception Mismatch due to tax amount modified in voucher.
2. Press Enter. All the transactions of the particular exception are displayed.
3. Select the required voucher and click A: Accept as is. A message is displayed as shown below:

4. Press Enter to accept.

5. Similarly, accept the required vouchers.
6. Press Ctrl+A to accept.

7. Voucher with incomplete/incorrect adjustment details

(GSTR-2)
Displays the count of journal vouchers in which the Nature of adjustment is not selected.

To resolve this exception

1. Select the exception Voucher with incomplete/incorrect adjustment details.
2. Press Enter. All transactions are displayed of a particular exception are listed, as shown below:

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3. Select the Nature of adjustment and Additional details for each voucher.
4. Press Ctrl+A to accept.

Filter for Item level and Ledger level exceptions

By default, the list of exceptions displays incomplete/mismatch information details voucher-wise.
However, the button options provided in the report allow you to view the exceptions item master-
wise or ledger-wise. In item master-wise view, all exceptions caused by an item can be resolved by
updating missing or incorrect information from a single screen. This will result in resolving multiple
voucher exceptions caused by the particular master. Similarly, all exceptions caused by a particular
ledger can be resolved from ledger-wise exceptions list.

Item Exceptions
Click I: Item Exceptions to alter the view of Vouchers with incomplete/mismatch in
information report to display vouchers with incomplete/mismatch of information in item master. The
vouchers with exceptions are displayed against different exception types in 2 columns:
Total Masters
Drill down from this column to view information missing/mismatch in item at master level. You can
provide the required details at stock group level to update all items in the group or at individual item
level. By providing required information at item master level, all voucher level exceptions resulting
from that item are resolved.
To update the information and resolve exception at master level
1. Click I: Item Exceptions.

2. Navigate to the required exception type and press Enter from Total Masters column to
display Multi Stock Alteration screen.

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3. Select the Classification.
The Multi Stock Alteration screen appears as shown below:

4. Enter HSN/SAC, and tax rate.

5. Select Taxability and enter the Effective date.
6. Press Ctrl+A to accept.
Total Vouchers
Drill down from this column to view information missing/mismatch in the items at voucher level. You
can provide the required details for each transaction.
To update the information and resolve voucher exception at voucher
level
1. Click I: Item Exceptions.

2. Navigate to required exception type and press Enter from Total Masters column to
display Exception Resolution screen, as shown below:

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3. Select the Nature of transaction.
4. Enter the Rate.
5. Press Ctrl+A to accept.

Ledger Exceptions
Click L: Ledger Exceptions to view of Vouchers with incomplete/mismatch in
information report displays vouchers with missing/mismatch of information in ledger master. The
vouchers with exceptions are displayed against different exception types in 2 columns:
Total Masters
Drill down from this column to view information missing/mismatch at ledger master level. You can
provide the required details at ledger group level to update all ledgers in the group or at individual
ledger level. By providing required information at leger master level, all voucher level exceptions
resulting from that ledger are resolved.
To update the information and resolve exception at master level
1. Click L: Ledger Exceptions.

2. Navigate to required exception type and press Enter from Total Masters column to display Multi

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Ledger Alteration screen, as shown below:

3. Enter HSN/SAC, and tax rate.

4. Select Taxability and enter the Effective date.
5. Press Ctrl+A to accept.
Total Vouchers
Drill down from this column to view information missing/mismatch in the ledger at voucher level. You
can provide the required details for each transaction.
To update the information and resolve voucher exception at voucher
level
1. Click L: Ledger Exceptions.

2. Navigate to required exception type and press Enter from Total Vouchers column to
display Exception Resolution screen, as shown below:

3. Select Nature of transaction and enter rate.

4. Press Ctrl+A to accept.

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GSTR-2 Table-wise View Report in
TallyERP9
The GSTR-2 report can be viewed in the table-wise format, which is structured to be in line with the
GSTR-2 format given by the department.
The GSTR-2 report opens in table-wise view. If you have changed it to default view
● Click V: Table-wise View in the GSTR-2 report.

By default, the table-wise format displays rows related to values for the current reporting period, and
rows of previous period amendments, if values are available. To view all the amendment rows,
enable the option Show amendment tables with zero values?under F12: Configure.

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Given below is the description of different tables.

Table name Description

4 B2B invoices Displays the taxable value and tax amount from taxable supplies to a
registered person recorded in the reporting period. The transactions are
recorded with:
Nature of transaction as
● Purchase Taxable.
● Purchase Taxable with Nature of goodsas Capital Goods when
grouped under Fixed Assets.
● Purchase From Unregistered Dealer - Taxable.
● Purchase From Unregistered Dealer - Taxable with Nature of
goods as Capital Goods when grouped under Fixed Assets.
● Purchase From Unregistered Dealer - Exempt.
● Purchase From Unregistered Dealer - Exempt with Nature of
goods as Capital Goods when grouped under Fixed Assets.
● Purchase Exempt.
● Purchase Exempt with Nature of goodsas Capital Goods when

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grouped under Fixed Assets.
● Purchase Nil Rated
● Interstate Purchase Taxable.
● Interstate Purchase Taxable with Nature of goods as Capital
Goods when grouped under Fixed Assets.
● Interstate Purchase Exempt.
● Interstate Purchase Exempt with Nature of goods as Capital
Goods when grouped under Fixed Assets.
● Interstate Purchase Nil Rated
Taxability as:
● Taxable
● Exempt
● Nil Rated
Registration type as
● Regular
● Unregistered
● Consumer
● Unknown (with or without GSTIN)

4A Amendments to B2B This table will be left blank.

Invoices

5. Import of Goods Invoices Displays the taxable value and tax amount from supplies exported
(including deemed exports) in the reporting period. The transactions
are recorded with:
Nature of transaction as
● Imports Taxable
● Imports Taxable with Nature of goods as Capital Goods when
grouped under Fixed Assets.
● Imports Exempt
● Imports Exempt with Nature of goods as Capital Goods when
grouped under Fixed Assets.
● Purchase From SEZ - Taxable
● Purchase From SEZ - Taxable with Nature of goods as Capital
Goods when grouped under Fixed Assets.
● Purchase From SEZ - Exempt
● Purchase From SEZ - Exempt with Nature of goods as Capital
Goods when grouped under Fixed Assets.

5A. Amendments to Import This table will be left blank.

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of Goods Invoices

6 Import of Service Invoices Displays the taxable value and tax amount from supplies exported
(including deemed exports) in the reporting period. The transactions
are recorded with:
Nature of transaction as
● Imports Taxable
● Imports Exempt
● Purchase From SEZ - Taxable
● Purchase From SEZ - Exempt

6A Amendments to Import of This table will be left blank.

Services Invoices

7 Credit/Debit Notes Displays the taxable value and tax amount from credit and debit notes
recorded in the reporting period. The credit and debit note transactions
are recorded with:
Nature of transaction as
● Purchase Taxable
● Purchase Taxable with Nature of goodsas Capital Goods when
grouped under Fixed Assets.
● Purchase From Unregistered Dealer - Taxable
● Purchase From Unregistered Dealer - Taxable with Nature of
goods as Capital Goods when grouped under Fixed Assets.
● Purchase From Unregistered Dealer - Exempt
● Purchase From Unregistered Dealer - Exempt with Nature of
goods as Capital Goods when grouped under Fixed Assets.
● Purchase Exempt
● Purchase Exempt with Nature of goodsas Capital Goods when
grouped under Fixed Assets.
● Purchase Nil Rated
● Interstate Purchase Taxable
● Interstate Purchase Taxable with Nature of goods as Capital
Goods when grouped under Fixed Assets.
● Interstate Purchase Exempt
● Interstate Purchase Exempt with Nature of goods as Capital
Goods when grouped under Fixed Assets.
● Interstate Purchase Nil Rated
Taxability as:
● Taxable
● Exempt

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● Nil Rated
Registration type as
● Regular
● Unregistered
● Consumer
● Unknown (with or without GSTIN)

7A Amendments to This table will be left blank.

Credit/Debit Notes

8 Nil Rated Invoices Displays the taxable value from nil rated, exempt, and non-GST inward
supplies. The transactions are recorded with:
Nature of transaction as
● Purchase From Composition Dealer
● Purchase Nil Rated
● Interstate Purchase Nil Rated
● Purchase Exempt
● Purchase Exempt with Nature of goodsas Capital Goods when
grouped under Fixed Assets.
● Interstate Purchase Exempt
● Interstate Purchase Exempt with Nature of goods as Capital
Goods when grouped under Fixed Assets.
● Purchase From Unregistered Dealer - Exempt
● Purchase From Unregistered Dealer - Exempt with Nature of
goods as Capital Goods when grouped under Fixed Assets.
Taxability as
● Exempt
● Nil Rated
● or Is Non-GST good? option enabled.
Registration type as
● Composite
● Unregistered
● Unknown (without GSTIN)

9 ISD Credit Displays the value of the journal voucher recorded by clicking J: Stat
Adjustment and selecting:
● The Nature of adjustment as Increase of Input Tax Credit.
● The Additional Details as ISD Transfer.

10(1) TDS Credit Displays the value of the journal voucher recorded by clicking J: Stat

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Adjustment and selecting:
● The Nature of adjustment as Increase of Input Tax Credit.
● The Additional Details as TDS Adjustment.

10(2) TCS Credit Displays the value of the journal voucher recorded by clicking J: Stat
Adjustment and selecting:
● The Nature of adjustment as Increase of Input Tax Credit.
● The Additional Details as TCS Adjustment.

11 ITC Received This table will be left blank.

12 Tax Liability under Displays the value of the advance payment voucher recorded under
Reverse Charge on reverse charge.
Advances

12A Amendments to Tax This table will be left blank.

liability under Reverse
Charge

13 Tax Paid under Reverse Displays the value of the advance payment voucher of the previous
Charge on Advance period, adjusted against the purchases of the current period.

14 ITC Reversal Displays the values of the journal vouchers recorded by clicking J:
Stat Adjustment and selecting Reversal of Input Tax Credit as
theNature of adjustment.

14A Amendments to ITC This table will be left blank.

Reversal

GSTR-2 Return Summary in Tally.ERP9

This section provides a summary of all transactions recorded in the reporting period. The
transactions are further classified based on the presence of GST details in the vouchers and their
effect on the returns.

Total number of vouchers for the period

Displays the total number of vouchers recorded in the reporting period. Drill down will lead to the
Statistics report, which displays the number of vouchers recorded against each voucher type,
divided into included, excluded and uncertain based the vouchers participating in the GST returns.

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The statistics report on drill down from Total number of vouchers for the period appears as
shown below:

Included in returns
Displays count of all vouchers that have requisite information to comply with requirements of GST
returns. Only these transactions will be exported as part of returns. Drill down from this row to view
the Summary of Included Vouchers report, with the list of voucher-types with voucher count.

Not relevant for returns

Displays the count of all vouchers which are not part of returns, as GST details are not provided in
these vouchers. These vouchers will have no implication on returns. Drill down from this row to
view Summary of Excluded Vouchers report, with transaction type-wise voucher count.
The Summary of Excluded Vouchers report appears as shown:

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Transaction Types
Excluded by User: Displays the count of vouchers manually excluded by user from list of included
or uncertain transactions. Drill down will lead to list of all the excluded vouchers. An excluded
voucher can be included by clicking I: Include Vouchers. Based on information in the voucher it will
move to either included or uncertain.
Contra Vouchers: Displays the count of contra entries which involve only bank and cash ledgers.
Drill down to view all the contra vouchers.
Order Vouchers: Displays the count of sales order, purchase order, job work in order and job work
out order vouchers. Drill down to view the all order vouchers.
Inventory Vouchers: Displays the count of receipt note, stock journal, delivery note, material in,
material out, rejections in, rejections out and physical stock vouchers as they are purely inventory in
nature and do not attract GST. Drill down to view all inventory vouchers.
Payroll Vouchers: Displays the count of transactions recorded using payroll and attendance
vouchers. GST does not apply to these transactions. Drill down to view all the payroll vouchers.
No GST Implications: Displays the count of receipts, payments, and journal vouchers that do not
have any GST implication. Drill down to view all the vouchers.
Other voucher: Displays the count of memorandum and reversing journal vouchers. Drill down to
view all memorandum and reversing journal vouchers.
Non GSTR2 Transactions: Displays the transactions which are part of other returns, for example:
GSTR-1, and hence will not have any implication on GSTR-2. Drill down to view all the GSTR-1
related sales transactions.
All the transaction types are not displayed by default. Based on the voucher type used and the
exclusions done by user, the relevant categories appear with the voucher count.
Incomplete/mismatch in information (to be resolved)
Displays the count of all vouchers with insufficient GST related information. These are exceptions
that need to be resolved for the vouchers to be included in the returns. Drill down from this row to
view the list of exception types and number of exceptions under each type. These exceptions can
be resolved right away, without having to alter vouchers or update masters one by one.

GSTR-2 Particulars of Default View

(Computation Details) in Tally.ERP9
The default view (click V: Default View in GSTR-2) of this section displays the transaction values
included in the returns along with the amount of adjustments, and GST payable (as reverse charge)
or refundable. The taxable amount, and tax amount under each GST tax type are displayed under

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respective columns for the specific period. Drill-down reports are provided for all purchases and
GST adjustments up to the transaction level.

Inward Supplies
Total inward supplies (local and interstate), which include taxable value, and the corresponding tax
amount are displayed here. The total local and interstate purchases are divided
into Taxable, Exempted, Reverse Charge Supplies, and Add/Less: GST Adjustments. To view
all the purchase transactions,
1. Click F1: Detailed to display the report in detailed mode.
2. Select any of the rows displayed in regular font, under Local Purchases or Reverse Charge
Supplies.
3. Press Enter to display the Voucher Register screen, as shown below:

You can view this report ledger wise or commodity wise by clicking L: Ledger-wise or S: Stock
item-wise, and A: Party-wise respectively.

GSTR-1 Summary of Exceptions Report in

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Vouchers with incomplete/mismatch in information list includes voucher that contain GST
details but are not included in the count of Included in returnsand Not relevant for returns due to
incomplete information or mismatch.
You can correct exceptions in the vouchers before exporting GST returns. The Vouchers with
incomplete/mismatch in information report appears as shown below:

The exceptions are listed in the order of priority, based on the importance of the information for
generating returns. Hence, a voucher with multiple exceptions is listed in the exception type higher
up the order. Once that exception is resolved, the voucher will move down to the next exception
type. Such vouchers with multiple exceptions continue to be listed as exceptions until all
incomplete/mismatch information are resolved. This will ensure that all exceptions are resolved
before filing the returns as follow :
1. No. of voucher with incomplete/mismatch in information
2. UoM(s) not mapped to Unit Quantity Code (UQC)
3. Country, state and dealer type not specified
4. Tax rate/tax type not specified
5. Nature of transaction, taxable value, rate of tax modified in voucher
6. Incorrect tax type selected in tax ledger
7. Mismatch due to tax amount modified in voucher
8. Voucher with incomplete/incorrect adjustment details
9. Information required for generating table-wise details not provided
10. Exception Types
11. Filter for Item level and Ledger level exceptions
11.1. Item Exceptions
11.2. Ledger Exceptions

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However, vouchers with only one exception are moved to Included in returns list after that
exception is resolved.

1. No. of voucher with incomplete/mismatch in information

Displays the count of total vouchers with exceptions. Drill down from this row to view all the
vouchers with exceptions, number of exceptions in each voucher, and type of exception. All
exceptions can be resolved from here without having to open different exception categories.

To resolve all exceptions without having to go from one exception type

to another
1. Select No. of voucher with incomplete/mismatch in information.
2. Press Enter to display Exception Resolution screen with the list of vouchers, number of
exceptions in each voucher, and exception types. The Exception Resolution screen appears as
shown below:

3. Select any transaction and press Enter to display the Voucher Details Alteration screen which
is divided into multiple sections, one for each exception in the voucher, as shown below:

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4. Select or enter required information for the first exception type. Further, you can click F5:
Recompute or A: Accept as is to recompute or accept the details, respectively.
5. Press Enter to navigate to next exception type.
6. Resolve the exceptions by providing details or using the buttons provided.
7. Press Enter after all exceptions in the voucher are resolved to view the next voucher with
respective exceptions.
8. Continue resolving the exceptions voucher by voucher, or press Esc to return to Exception
Resolution screen.
Note: Click X: Exclude Vouchers in the Exception Resolution screen to exclude the voucher from
GSTR-1 return.

2. UoM(s) not mapped to Unit Quantity Code (UQC)

Displays the count of transactions for which Unit Quantity Code is not mapped with the unit of
measure.

To resolve this exception

1. Select the exception UoM(s) not mapped to Unit Quantity Code (UQC). You can map the unit
of measure with UQC using the button (S: Map with UQC) or pressing Enter on the UoM Symbol.
2. Select the UoM Symbol.
● Mapping with UQC from the report
o Click S: Map with UQC and select the UQC.

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o Press Enter to save.
● Selecting UQC in the stock item master
o Press Enter on the selected UoM Symbol.
o Select the Unit Quantity Code (UQC), as shown below:

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o Press Enter to save.

3. Country, state and dealer type not specified

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Resolution screen appears.
3. Select the state, specify the GSTIN and select dealer type for each transaction.

4. Press Ctrl+A to accept.

Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-1 return.

4. Tax rate/tax type not specified

Displays the count of transactions for which the rate or tax type is not selected in the item/ledger
master.

To resolve this exception

1. Select the exception Tax rate/tax type not specified.
2. Press Enter. All the transactions of the exception type are displayed. The Exception
Resolution screen appears as shown below:

3. Select the Nature of transaction, if not provided.

4. Enter Rate, as required for each transaction.
5. Press Enter to save.
Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-1 return.

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5. Nature of transaction, taxable value, rate of tax modified
in voucher
Displays count of transactions in which the Nature of transaction, taxable value or rate of tax
defined in the ledger master has been changed in the transaction.
To resolve this exception
1. Select the exception Nature of transaction, taxable value, rate of tax modified in voucher.
2. Press Enter. All the transactions of the exception type are displayed, as shown below:

3. Select the required voucher.

4. Click R: Resolve to select Nature of transaction and enter other details manually, or click A:
Accept as is. A message is displayed as shown below:

5. Press Enter to accept.

6. Similarly, accept the required vouchers.
7. Press Ctrl+A to accept.

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6. Incorrect tax type selected in tax ledger
Displays count of transactions in which type of duty is invalid.

To resolve this exception

1. Select the exception Incorrect tax type selected in tax ledger.
2. Press Enter. All the transactions of the exception type are displayed, as shown below:

3. Select the tax type for each transaction.

4. Press Enter to save.

7. Mismatch due to tax amount modified in voucher

Displays the count of transactions in which difference is found between the calculated and entered
tax amount. The mismatch due to modified value can be resolved by following one of the options.

To resolve this exception

1. Select the exception Mismatch due to tax amount modified in voucher.
2. Press Enter. All the transactions of the exception type are displayed.
3. Based on your accounting requirements, you can recompute the tax values, or resolve the
mismatch, or accept the transaction as is.
● Resolve
o Navigate to required transaction.
o Click R: Resolve, and enter the tax value in As per transaction column of the voucher.
The Exception Resolution screen appears as shown below:

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o Press Ctrl+A to accept. Similarly, resolve the required vouchers.
● Accept as is
o Navigate to required transaction.
o Select the required voucher and click A: Accept as is. A message is displayed as shown below:

o Press Enter to accept. Similarly, accept the required vouchers.

● Recompute
o Navigate to required transaction and press Enter.
o Click F5: Recompute to recalculate the tax amount.

o Press Ctrl+A to accept. Similarly, recompute the required vouchers.

8. Voucher with incomplete/incorrect adjustment details

Displays the count of journal transactions in which Nature of adjustment is not selected.

To resolve this exception

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1. Select the exception Voucher with incomplete/incorrect adjustment details.
2. Press Enter. All transactions are displayed of a particular exception are listed, as shown below:

3. Select the Nature of adjustment and Additional details for each voucher.
4. Press Ctrl+A to accept.

9. Information required for generating table-wise details not

provided
Displays the count of transactions excluded from table-wise format of GSTR-1 due to incomplete
information. The button Exception Types is provided to resolve all party ledger level or voucher
level corrections from a single screen.

To resolve all exceptions without having to go from one exception type

to another
1. Select Information required for generating table-wise details not provided.
2. Press Enter to display Exception Resolution screen with list of vouchers with
mismatch/incomplete information.

3. Select any voucher and press Enter to display the Table-wise exceptions(s) screen, as shown
below:

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4. Enter the missing information or update the incorrect details, and press Enter to return to
the Exception Resolution screen.
5. Select the next voucher to update the required details and continue.

10. Exception Types

Using this option you can resolve exceptions from a common screen by grouping all table-wise
related exceptions into two buckets Party Ledger level Corrections and Configuration Level
Corrections. Exceptions in each group can be resolved from a single screen without having to
move voucher by voucher.

To resolve all party ledger level exceptions

1. Select Information required for generating table-wise details not provided.
2. Press Enter to display Exception Resolution screen with list of vouchers with
mismatch/incomplete information.
3. Press Ctrl+E.

4. Select Party Ledger Level Corrections in the Select Exception Resolution Type screen.
5. Select the State Name, State Code and enter party GTIN number for the listed parties in
the Party Ledger Level correction screen, as shown below:

6. Press Ctrl+A to accept.

To resolve all configuration level exceptions

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1. Select Information required for generating table-wise not provided.
2. Press Enter to display Exception Resolution screen with list of vouchers with
mismatch/incomplete information.
3. Press Ctrl+E.

4. Select Configuration Level Corrections in the Select Exception Resolution Type screen.

5. Enter HSN/SAC code for the listed vouchers.

6. Press Ctrl+A to accept.
Drill-down from any row and resolve the respective exceptions to include the vouchers in return.

11. Filter for Item level and Ledger level exceptions

11.1. Item Exceptions

Click I: Item Exceptions to alter view of Vouchers with incomplete/mismatch in
information report to display vouchers with incomplete/mismatch of information in item master. The
vouchers with exceptions are displayed against different exception types in 2 columns:
Total Masters
Drill down from this column to view information missing/mismatch in item at master level. You can
provide the required details at stock group level to update all items in the group or at individual item
level. By providing required information at item master level, all voucher level exceptions resulting
from that item are resolved.

To update the information and resolve exception at master level

1. Click I: Item Exceptions.

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2. Navigate to required exception type and press Enter from Total Masters column to display Multi
Stock Alteration screen.
3. Select the Classification.
The Multi Stock Alteration screen appears as shown below:

4. Enter HSN/SAC, and tax rate.

2. Navigate to required exception type and press Enter from Total Masters column to
display Exception Resolution screen, as shown below:

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3. Select Nature of transaction.
4. Enter Rate.
5. Press Ctrl+A to accept.

11.2. Ledger Exceptions

Click L: Ledger Exceptions to view of Vouchers with incomplete/mismatch in
information report displays vouchers with missing/mismatch of information in ledger master. The
vouchers with exceptions are displayed against different exception types in 2 columns:
Total Masters
Drill down from this column to view information missing/mismatch at ledger master level. You can
provide the required details at ledger group level to update all ledgers in the group or at individual
ledger level. By providing required information at leger master level, all voucher level exceptions
resulting from that ledger are resolved.
To update the information and resolve exception at master level
1. Click L: Ledger Exceptions.

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2. Navigate to required exception type and press Enter from Total Masters column to display Multi
Ledger Alteration screen, as shown below:

3. Enter HSN/SAC, and tax rate.

2. Navigate to required exception type and press Enter from Total Vouchers column to
display Exception Resolution screen, as shown below:

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3. Select Nature of transaction and enter rate.
4. Press Ctrl+A to accept.

Table-wise View in the GSTR-1 Report in

TallyERP9
GSTR-1 report can be viewed in the table-wise format. The table-wise report is structured in line
with the GSTR-1 format given by the department.

To view the report in table-wise format

● Click V: Table-wise View in the GSTR-1 report.

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Given below is the description of different tables.

Table name Description

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● Taxable
● Exempt
● Nil Rated
Registration type as
● Regular
● Composite
● Unknown (with GSTIN)

5A Amendments to Displays amendments to details of outward supplies to a registered person

B2B Invoices of earlier tax periods.

6A Amendments to Displays amendments to details of taxable outward supplies to a consumer

B2C(Large) Invoices where place of supply is other than the state where supplier is located
(Inter-state supplies) and invoice value is more than Rs 2.5 lakh of earlier
tax periods.

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· Interstate Sales Nil Rated
· Sales to Consumer – Taxable
· Sales to Consumer – Exempt
Taxability as:
· Taxable
· Exempt
· Nil Rated

Registration Type as:

· Unregistered
· Consumer
· Unknown (with GSTIN)
and invoice value of less than 2.5 lakhs are captured in this table.

7A Amendments to Displays amendments to details of taxable value and tax amount from
B2C(Small) Invoices taxable outward supplies to consumer (Other than captured in table 6) of
earlier tax periods.

8A Amendments to Displays amendment to details of credit and debit notes of earlier tax
Credit/Debit Notes periods.

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● Unregistered
● Unknown

10A Amendments to Displays details of amendments to supplies exported of earlier tax periods.
Exports Invoices

11A Amendments to Displays details of amendments to tax liability arising on account of time of
Tax Liability on supply without issuance of invoice in the same period.
Advances

GSTR-1 Status Reconciliation Report in

Tally.ERP9
GST compliance is complete if information of outward and inward supplies in books reconcile with
the data on GST portal. Due to involvement of counter-party, multiple systems, and users,
discrepancies creep in frequently making reconciliation a critical step.
The filing process involves
● Supplier uploading details of outward supplies in GSTR-1.
● Buyer receiving the supply details in his GSTR-2A.
● Buyer approving, rejecting, modifying or adding the supply details and filing GSTR-2.
● Supplier receiving the modified supply details in GSTR-1A. Supplier approving or rejecting the
updated supply details.
All the approval, rejection, or modification is done on the GST portal. The supplier or the buyer has
to login to the GST portal to check the status of each voucher. The GSTR-1 report in Tally.ERP 9
has the status reconciliation feature that enables you to mark the status of each transaction based
on the online status. This will allow you to track the status of all the transactions uploaded without
having to login to the portal.

To view Status Reconciliation report

1. Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR – 1.
2. Click U: Status Reconciliation. The Status Reconciliation screen appears as shown below:

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Count: Displays the total count of vouchers under the particular table for the reporting period.

Activity Status
To Be Uploaded: Displays the number of vouchers yet to be exported. The count vouchers that are
not yet exported to GSTR-1 return file are displayed in this column.
Uploaded: Displays the number of vouchers exported. This column is automatically updated when
a voucher is exported to GSTR-1 return file.
Rejected by GST: Displays the count of vouchers marked as Rejected by GST. You can mark the
voucher status as rejected when GST rejects the voucher for reasons such as, duplicate invoice,
reference of original transaction is not found in case of debit/credit note, GSTIN of any user being
suspended, and so on.
Accepted: Displays the count of vouchers marked as Accepted. You can mark the status as
accepted when input tax claim made by the buyer in the GSTR-1A.
Rejected: Displays the count of vouchers marked as Rejected. You can mark the status as rejected
when the buyer rejects the voucher details as displayed in the GSTR-1A.

Reconciliation Status
Not Reconciled: Displays the count of vouchers marked as Not Reconciled. You can mark the
status as Not Reconciled when the details in the online portal do not match with your books.
Reconciled: Displays the count of vouchers marked as Reconciled. You can mark the status as
Reconciled when the details in the online portal match with your books.

Set Status
Drill down from any table to view the voucher register with list of vouchers and change the status of

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the voucher.
The voucher register displayed on drill down from a table in Status Reconciliation screen appears
as shown below:

To set the status of a voucher

1. Select a voucher or multiple vouchers using Spacebar.
2. Click S: Set Status.

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3. Select the Activity status and Reconciliation status of the voucher based on the details in the
GST portal and press Enter.
The status change is displayed in the Voucher Register as shown:

4. Press Escape (Esc) to return to the Status Reconciliation screen. The voucher count in
columns is changed based on the status updates.

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Status-wise View
You can view the status reconciliation in the status-wise view.
To change to status-wise view
1. Click F5: Status-wise View in the Status Reconciliation screen.

F12: Configure
Show uncertain transactions?: Enable this option to view the number vouchers that are not
included in the returns due to incomplete information or mismatch. This voucher count is displayed
at the bottom of the Status Reconciliation screen.

Reversal of Tax Credit under GST in

Tally.ERP9
Reversal of tax credit can be done for trading goods, capital goods, goods meant for self-
consumption and services. You can reverse the tax credit, using a journal voucher.

To record a journal voucher for reversing the tax credit

1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
3. In the Stat Adjustment Details screen, select the options as shown below:

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4. Press Enter to save and return to the journal voucher.
5. In the journal voucher, debit the expense or party ledger, and credit the integrated tax, central
tax, state tax/UT tax or cess ledgers.
6. Press Ctrl+A to accept the voucher.

Refund of Tax Credit under GST in

Tally.ERP9
You can claim the excess amount paid as tax, interest, penalty, late fee or other dues as refund
using a journal voucher.

To record a journal voucher for refund

1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
3. In the Stat Adjustment Details screen, select the options as shown below:

4. Press Enter to save and return to the journal voucher.

5. Debit the bank ledger, and enter the amount of interest liability.
Note: To select bank or cash ledger, click F12: Configure and set the option Allow cash accounts
in journal vouchers? to Yes in the Voucher Configurationscreen.
6. Credit the GST ledgers or ledger grouped under Current Assets.

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7. Press Ctrl+A to accept the ]journal voucher.
Similarly, you can record the journal voucher by selecting the Additional Details in the Stat
Adjustment Details as:
● Not Applicable, for refund of excess tax payment made.
● Penalty, for refund of excess payment made towards penalty.
● Late Fee, for refund of excess payment made towards late fee.
● Others, refund of excess payment made towards other dues.

Recording Transitional Credit under GST in

Tally.ERP9
When the stock purchased during the previous tax regime is cleared, the tax credit can be claimed
under GST. This facility is available only upto 6 months from the date of implementation of GST.
You can record this transaction using a journal voucher.
To record a journal voucher for transitional credit
1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
3. In the Stat Adjustment Details screen, select the options as shown below:

4. Press Enter to save and return to the journal voucher.

5. In the journal voucher,

● For availing tax credit on excise and service tax, debit the central tax ledger and credit the service
tax and CENVAT ledgers.
● For availing tax credit on VAT, additional tax, cess, TDS and entry tax, debit the state tax/UT tax
ledger and credit the VAT, additional tax, cess, TDS and entry tax ledgers.

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Adjustments Against Tax Credit under GST
in Tally.ERP9
The tax credits of central tax, integrated tax and state tax can be used to set-off the liability of
central tax, state tax/UT tax and integrated tax in the order specified under GST.

The order in which tax credit can be offset is given below:

Input Tax Credit Set-off against the Liability

Central tax Central tax and integrated tax (in that order).

Integrated tax Integrated tax, central tax, state tax/UT tax (in that order).

State tax/UT tax State tax/UT tax and integrated tax (in that order).

To record a journal voucher for cross utilisation of tax credits

1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
Note: You can also create a journal voucher from Gateway of Tally > Display > Statutory
Reports > GST > GSTR-1 or GSTR-2.
2. Click J: Stat Adjustment.
3. In the Stat Adjustment Details screen, select the options as shown below:

4. Press Enter to save and return to the journal voucher.

5. In the journal voucher, debit and credit the ledgers as per the scenarios mentioned below:

Scenario Debit Ledger Credit Ledger

Utilisation of central tax ● Debit the Credit the central tax ledger
credit, when only central central tax to set-off the payable amount

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ledger

● Enter the
tax credit is available. amount to the against the available credit.

extent of credit
available.

● Credit the central tax

● Debit the ledger, and enter the
central tax total amount
Utilisation of central tax
ledger. payable.
credit, when central tax
● Enter the ● Credit the integrated
and integrated tax credits
amount to the tax ledger if the tax
are available.
extent of credit credit remains after it
available. is set-off against
central tax dues.

● Debit the
state tax ledger.
Utilisation of state tax Credit the state tax ledger to
● Enter the
credit, when only state set-off the payable amount
amount to the
tax credit is available. against the available credit.
extent of credit
available.

● Credit the state tax

ledger, and enter the
● Debit the
total amount
Utilisation of state tax state tax ledger.
payable.
credit, when state tax ● Enter the
● Credit the integrated
and integrated tax credits amount to the
tax ledger if the tax
are available. extent of credit
credit remains after it
available.
is set-off against
state tax dues.

Utilisation of integrated ● Debit the Credit the integrated tax

tax credit, when only integrated tax ledger to set-off the payable

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ledger.

● Enter the
integrated tax credit is amount against the available
amount to the
available. credit.
extent of credit
available.

● Credit the integrated

● Debit the tax ledger, and enter
integrated tax the total amount
Utilisation of integrated
ledger. payable.
tax credit, when
● Enter the ● Credit the central tax
integrated tax and central
amount to the ledger, if the tax
tax credits are available.
extent of credit credit remains after it
available. is set-off against
integrated tax dues.

● Credit the integrated

tax ledger, and enter
the total amount
payable.
● Debit the
● Credit the central tax
Utilisation of integrated integrated tax
ledger, if the tax
tax credit, when ledger.
credit remains after it
integrated tax, central tax ● Enter the
is set-off against
and state tax/UT tax amount to the
integrated tax dues.
credits are available. extent of credit
● Credit the state tax
available.
ledger, if the tax
credit remains after it
is set-off against
central tax dues.

Utilisation of cess credit, ● Debit the Credit the cess ledger to set-
when only cess credit is cess ledger. off the payable amount
available. against the available credit.
● Enter the

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amount to the
extent of credit
available.

Journal Vouchers for Interest, Penalty, Late

Fee and Other Dues in GST in Tally.ERP9
You can a record journal voucher to raise the liability towards interest, penalty, late fee, or other
dues.
To record a journal voucher for interest, penalty, late fee and other dues
payable
1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
3. In the Stat Adjustment Details screen, select the options as shown below:

4. Press Enter to save and return to the journal voucher.

5. Debit the expenses or party ledger, and enter the amount of interest liability.
6. Credit the ledger grouped under Current Liabilities.
7. Press Ctrl+A to accept the journal voucher.

Similarly, you can record the journal voucher by selecting the Additional Details in the Stat
Adjustment Details as:
● Penalty, for penalty payable.
● Late Fee, for late fee payable.
● Others, for other dues payable.

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Advance Payment to Supplier under
Reverse Charge in GST in Tally.ERP9
You can record advance payments made to registered or unregistered dealers in a payment
voucher, raise liability in journal voucher, record a refund voucher in receipt voucher if advance
payment transaction is cancelled, and cancel the liability on advance payment in journal voucher.

Advance payment
Raising liability for advance payment
Refund voucher cancellation of advance payment transaction
Cancelling the liability of advance amount to the extent the transaction is
cancelled
Advance Payment
To record a payment voucher for advance payment
1. Go to Gateway of Tally > Accounting Vouchers > F5: Payment.

2. Click V: Reverse Chrg. Adv. to mark the voucher for advance payment.
3. Account: Select the bank to which the payment will be made.
4. Select the party ledger enabled for bill-wise details.
5. In the Advance Payment Details screen:

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● All stock items are displayed when the party is an unregistered dealer.
● Only stock items which attract reverse charge (Is reverse charge applicable? is set to Yes in
stock item master) are displayed when the party is a regular dealer.
Note: To select a ledger, click L: Show Ledgers.
♦ Only ledgers which attract reverse charge (Is reverse charge applicable? is set to Yes in ledger
master) are displayed when the party is a regular dealer.
♦ When the party ledger is an unregistered dealer, all ledgers are displayed.
● Click F12: Configure and set the option:
o Allow to provide rate of stock items? to Yes, to enter/alter the slab rate of the stock item.
o Allow to provide quantity for calculation of cess on quantity? to Yes, to enter the cess rate
and cess rate per unit.
o Allow modification of tax details? to Yes, to override the GST and cess rates in the voucher.
6. Select the Stock Item (goods enabled for GST) or Ledger Name (services enabled for GST),
and enter the Advance Amount.

The Advance Amount appears as the Taxable Value, and the tax amount is calculated on this. The
tax values shown in the Advance Payment Details is the amount on which you need to generate
the liability in a journal voucher if the purchase invoice is not recorded within the return period.
The tax type appears as integrated tax or central tax and state tax, based on the state selected for
the party ledger.
7. Press Ctrl+A to save the Advance Payment Details screen.
8. Select the type of reference as Advance and enter the reference details in the Bill-wise
Details screen.
9. Accept the payment voucher.

Journal voucher to raise the liability

To record a journal voucher to raise the liability
1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
3. Select the options as shown below.

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4. Debit the expense ledger or ledger grouped under Current Assets and credit the GST ledgers
for the tax on advance receipt, as shown below:

5. Press Enter to save.

The tax liability raised on the advance amount appears in GSTR-3B as shown below:

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Refund Voucher
If the advance payment transaction is cancelled fully or partially, you can record it in a receipt
voucher by marking it as a refund voucher.
To record a refund voucher
1. Go to Gateway of Tally > Accounting Vouchers > F6: Receipt.
2. Click F: Refund of Adv. Pymt.

3. Select the bank Account.

4. Select the party ledger enabled for bill-wise details. In the Refund Details section, the list of
stock items are displayed for selection. To select a ledger, click L: Show Ledgers. Click F12:

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Configure and set the option:
● Allow to provide rate of stock items to Yes, to enter/alter the slab rate of the stock item.
● Allow to provide quantity for calculation of cess on quantity to Yes, to enter the cess rate
and cess rate per unit.
● Allow modification of tax details to Yes, to override the GST and cess rates in the voucher.
5. Select the Stock Item (goods enabled for GST) or Ledger Name (services enabled for GST).
6. Enter the Refund Amount which is inclusive of GST. The break-up of GST amount gets auto
calculated for Central Tax, State Tax, and Cess, if applicable. The Refund Details section appears
as shown below:

The Advance Amount appears as the Taxable Value, and the tax amount is calculated on this. The
tax values shown in the Advance Payment Details is the amount on which you need to generate the
liability in a journal voucher.
7. Press Ctrl+A to accept and return to payment voucher.
8. Select the type of reference as Agst Ref and select the reference details in the Bill-wise
Details screen.
9. Set Provide GST details? to Yes, and enter the Receipt No. and Date of the advance receipt.
10. Press Enter to save.
11. Click P: Print and set Print Refund Voucher? to Yes, as shown below:

The printed refund voucher appears as shown below:

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Cancelling the liability to the extent of refund voucher
To reverse the tax liability
1. Click J: Stat Adjustment in GSTR-3B report or from the Accounting Vouchers > F7: Journal.
2. Select the options as shown below.

3. Debit the GST ledgers and credit the expense ledger, or ledger grouped under Current Assets.

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GST Payment Voucher in Tally.ERP9
You can record payments such as, interest, late fee, penalty, and others made to the GST
department using a tax payment voucher. Interest, late fee, penalty and others are to be paid
separately for central tax and state tax.

To record a tax payment voucher

1. Go to Gateway of Tally > Accounting Vouchers > F5: Payment.

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2. Click S: Stat Payment and enter the required details.

Payment Type: Set the type of payment as Regular.

3. Account: Select the bank from which the payment will be made.
4. Select the central and state tax ledgers. If you have to pay interest, penalty, late fee or other
dues, select the ledgers to make the payment. created to account for these dues. Ensure these
ledgers are grouped under Direct Expenses/Indirect Expenses/Current Liabilities.
5. Select the type of payment to be made to the GST department.

6. Provide GST details: Enable this option to enter the bank details.

If the bank details are not available, you can enter them later in the Challan Reconciliation report.
7. In the Bank Allocations screen, select the ledgers, enter the amount and provide the payment
details.
8. Press Enter to save.
Similarly, you can record other tax payments to be made to the GST department.

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Sales Returns under GST in Tally.ERP9
You can record sales returns (both local and interstate) against an earlier sales transaction using a
credit note.
Your sales returns will be captured in table 8 (Credit/Debit Notes) in GSTR-1.
To record sales return using a credit note
1. Go to Gateway of Tally > Accounting Vouchers > Ctrl+F8.

2. In Original invoice no., enter the invoice number of the original sales transaction against which
you are recording the current sales return.
3. In Party’s A/c Name, select the party against which the original sales was made.
4. Select the central tax and state tax ledgers.
5. Provide GST details: Enable this option if you want to enter additional details about the
purchase return.

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o 01-Sales Return - When there is a return of goods or services after sales.
o 02-Post sale discount - When discount is allowed on goods or services after sales.
o 03-Deficiency in service - When there is a deficiency in services (like a quality issue) after sales.
o 04-Correction in invoice - When there is a change in the invoice raised that leads to change in
tax amount.
o 05-Change in POS - When there is a change in place of supply that leads to change in tax
amount.
o 06-Finalization of Provisional assessment - When there is a change in price or rate after the
department issues a notification about the finalized price of the goods or services.
o 07-Others - Any other nature of return.
Similarly, you can record sales returns against an interstate sales transaction by selecting the
relevant party, sales ledger, and integrated tax ledger.

Export Sales under GST in Tally.ERP9

You can record the export of goods using a sales vouchers.
In an export sales transaction, taxes are applicable based on the type of export:
● Taxable export: Integrated tax is applicable. Select Exports Taxable as the Nature of
transaction in the sales ledger created for taxable exports.
● Exempt export: No tax is applicable. Select Exports Exempt as the Nature of transaction in the
sales ledger created for exempt exports.
● Export under LUT/bond: No tax is applicable. Select Exports LUT/Bond as the Nature of
transaction in the sales ledger created for exports under LUT/bond.
o Export under LUT/bond is applicable when you have signed up a letter of undertaking with the
department for the export of goods without the payment of duty.
o To provide details of the LUT/bond, enable the options Enable Goods and Services Tax
(GST)? and Set/alter GST details? in Statutory and Taxation features. In the Company GST
Details screen that opens, enable the option Provide LUT/Bond details?, and enter the details in
the LUT/Bond Details screen.

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To record export sales transaction
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.

2. In Party A/c name, select the customer ledger or the cash ledger.
3. Select the sales ledger. You can also create separate sales ledgers for taxable exports, exempt
exports, and exports under LUT/bond, and select them during the transaction.
4. Select the integrated tax ledger if it is a taxable export.
5. Provide GST details - Yes, if you want to enter additional details regarding the export
transaction.

Sales of Mixed Supply Under GST in

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You can record the sales of a mixed supply using a sales invoice. For this, create a new stock item
to account for the bundle of items. The tax of the highest-rated item in the bundle is applicable for
this bundled unit.
To record the sales of a mixed supply
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.

2. Select the applicable tax ledgers (central and state/union territory taxes for local supply,
integrated tax for interstate supply).

Sales of Composite Supply Under GST

(Expense Apportioning) in Tally.ERP9
You can record the sales of a composite supply using a sales invoice. The rate of tax applicable on
the principal supply will be considered as the rate of tax for the composite supply.
In a composite supply of both goods and services, either one of them can be the principal supply. If
you are not sure about the principal supply and the secondary supply, you can create separate
invoices for the goods and services.
For composite supply:
Create a service ledger to participate in the sales of composite supply.

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Record sales of composite supply.
To create a service ledger
1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create.

2. Is GST Applicable? - Not Applicable. The option Include in assessable value calculation
for appears.
3. Include in assessable value calculation for - GST.
o Appropriate to - Goods, as the principal supply is considered as goods in this example.
4. Press Ctrl+A to accept.

To record the sales of composite supply with goods as principal item

1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.

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2. Select the service ledger (in this example, the ledger applicable for transportation charges).
3. Select the applicable tax ledgers (central and state/union territory taxes for local supply,
integrated tax for interstate supply).
You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax break-
up.

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Nil-Rated GST Sales in Tally.ERP9
The sales of nil-rated goods to a local or interstate customer does not attract GST, and can be
recorded using a sales voucher. In the masters of the goods or services classified as nil rated
(0%), Taxability should be set to Nil Rated in the GST Details screen.
● Go to Gateway of Tally > Accounting Vouchers > F8: Sales.
● Select the applicable Sales ledger. For example, Sales Nil-Rated.
While recording any type of sales transaction, you can choose either of the following methods:
● Method 1: For a specific type of sales transaction, you can create or update the sales ledger with
the relevant Nature of transaction. Now select this sales ledger while recording the sales
transaction.

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● Method 2: Select the common sales ledger during the sales transaction. Press F12 and enable
the option Allow modification of tax details for GST? Now select the Classification/Nature.

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Depending on the location of the party, you can record a local or interstate nil-rated sales
transaction.

Exempted GST Sales in Tally.ERP9

The local or interstate sale of goods or services exempted from GST can be recorded using a
sales voucher. In the masters of the exempted goods or services, Taxability should be set
to Exempt in the GST Details screen.
● Go to Gateway of Tally > Accounting Vouchers > F8: Sales.
● Select the applicable Sales ledger.

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Note :
While recording any type of sales transaction, you can choose either of the following methods:
● Method 1: For a specific type of sales transaction, you can create or update the sales
ledger with the relevant Nature of transaction. Now select this sales ledger while
recording the sales transaction.

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● Method 2: Select the common sales ledger during the sales transaction.
Press F12 and enable the option Allow modification of tax details for GST? Now
select the Classification/Nature.

SEZ (Special Economic Zone) GST Sales

in Tally.ERP9
The sale of goods and services to a party in an SEZ can be recorded using a sales vouchers. In
an SEZ sales transaction, taxes are applicable based on the type of sale:
● Taxable SEZ sale: In SEZ sales, integrated tax is applicable for both local and interstate
parties.
● Exempt SEZ sale: No tax is applicable.
● SEZ sale under LUT/bond: No tax is applicable. SEZ sales under LUT/bond are allowed
when you have signed up a letter of undertaking with the department for the sale of
goods without the payment of duty.
To provide details of the LUT/bond, enable the options Enable Goods and Services Tax
(GST)? and Set/alter GST details? inStatutory and Taxation features. In the Company GST
Details screen, enable the option Provide LUT/Bond details?, and enter the details in
the LUT/Bond Details screen.

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To record SEZ sales
● Go to Gateway of Tally > Accounting Vouchers > F8: Sales.
● Select the applicable Sales ledger. For example, Sales - SEZ.

Provide GST details: Enable this option if you want to enter additional details regarding the
export transaction.

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● Method 2: Select the common sales ledger during the sales transaction.
Press F12 and enable the option Allow modification of tax details for GST? Now
select the Classification/Nature.

GST Sales to Consumers - Taxable and

Exempt in Tally.ERP9

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You can record sales to consumers (end users of your goods or services) and unregistered
dealers, using a sales invoice.
Depending on the transaction value and the location of the party, the sales invoice will be
captured in different tables inGSTR-1 returns.
● B2C (Large) Invoices: Captures interstate sales transactions where the invoice value is
more than Rs. 2.5 lakh.
The following images show how large invoices are captured in GSTR-1 for an interstate
party:

● B2C (Small) Invoices: In GSTR-1, this table captures:

o Local sales transaction: Irrespective of the invoice value.
o Interstate sales transactions: where the total invoice value is less than Rs. 2.5 lakh.
The following images show how small invoices are captured in GSTR-1:

GST Sales Involving Consignee (Ship To)

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and Buyer (Bill To) in Tally.ERP9
In Tally.ERP 9, you can record GST sales where a consignee and a buyer are involved. Here, the
goods are sent to the consignee, and the bill is sent to the buyer.
Note: In this case, GST calculation depends only on the location of the buyer, and not the
consignee.
♦ If the buyer is located in the same state: Central tax and state tax are applicable.
♦ If the buyer is located in a different state: Integrated tax is applicable.
To add buyer and consignee details in the same invoice, enable the following options:
● Go to F11: Features > F1: Accounting Features, and enable the option Maintain
multiple mailing details for company and ledgers?
● Press F12 on the sales invoice, and enable the option Allow separate buyers and
consignee names?
To record GST sales involving a consignee and a buyer
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.

2. In Party A/c name, select the buyer, and enter the relevant details in the Party
Details screen.
o In Consignee, click Alt+M to select the consignee ledger.

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3. Select the sales ledger.
4. Select the required items, and specify the quantities and rates.
5. Select the relevant GST ledgers (state tax and central tax for local buyer; integrated tax for
interstate buyer).
6. Press Alt+P to print the invoice. The consignee and buyer details appear as shown below:

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GST Sale of Works Contract Services in

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Tally.ERP9

Sale of works contract services

To record a sales invoice for works contract
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.

2. In Party A/c name, select the customer ledger.

3. Select the sales ledger and enter the amount.
4. Select the GST ledgers (central and state, or integrated) based on the state selected for the
customer ledger.
You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

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Recording GST Local Sales and Printing
Invoices in Tally.ERP9
To record a Local Sales Transaction
1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.

As per our Practical Example No. 4

Sale of 5 Antivirus CDs @ Rs.1500 to Rajib Roy & Sons with output GST 18% i.e. Rs. 1350 – [CGST
(9%) Rs. 675 and SGST (9%) Rs.675 ]

2. In Party A/c name, select the customer ledger or the cash ledger.

3. Select the sales ledger.

4. Select the required items, and specify the quantities and rates.

5. Select the central and state tax ledgers.

You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

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Note : As per GST Rate applied at the time of creating of Items, CGST & SGST will be
automatically calculated according to Items GST Rate.

6. In the sales invoice, press Alt+P to print the invoice in the required format.

For multiple copies: Press Alt+P and then Alt+C to select the number of copies.

B. Printed Invoice Format

As per GST guidelines, details such as the applicable taxes and tax rates, and the GSTIN/UIN
of the company and the customer will be captured. Depending on your requirements, you can
include additional details in your invoice by clicking F12: Configure

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As per our Practical Example No. 5
Sale of 10 Monitors @ Rs.4500 , to H. Goenka Traders with Output GST @ 28% i.e. Rs. 12600 –
[ CGST (14%) Rs. 6300 and SGST (14%) Rs. 6300 ]

The above Local Sales Invoice will be as below :

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You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

As per our Practical Example No. 6

Sale of 2 ‘Hp-Laptop’ @ Rs 50,000 with Output GST @ 18% i.e. Rs.18,000 [ CGST (9%) Rs.9,000
and SGST (9%) Rs.9,000 ] in Cash within State Odisha.

The above Local Sales Invoice will be as below :

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You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

Recording IGST-Inter-State Sales (Outside

Sale) in Tally.ERP9
Sale of goods or services to a customer in another state attract integrated tax.
To record an interstate sale
● Follow the steps used for recording a local sales transaction. The only difference is that

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you have to select the integrated tax ledger instead of central tax and state tax.
As per our Practical Example No. 7
2 Mi-Note 4 Mobiles Outside State @ Rs. 15,000 each with Output IGST 12% i.e. Rs. 3600 in Cash
to a Party in Outside State i.e. Andhra Pradesh.

The above Local Sales Invoice will be as below :

You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

Depending on the location of the party, you can record a local or interstate sales transaction
with the applicable GST rates, and print the invoice.

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GST Sale of Goods and Services in a
Single Invoice in Tally.ERP9
You can record the sales of both goods and services in the same invoice by selecting the
required sales ledger and GST ledgers (state tax and central tax for local sales; integrated tax
for interstate sales)
Setup :
Create a Ledger “Installation Charges” under ‘Direct Income’ with GST Applicable @ 5% as
details below :

Restarting Voucher Numbering in

Tally.ERP9
You can restart the numbering of your vouchers by creating a new voucher type and specifying the
applicable dates, prefix, suffix, and other details, as needed.
Note: In order to be GST-compliant, the voucher numbers of your invoice have to be unique and
continuous. You can continue to use your existing series of voucher numbers. For your convenience,
you can prefix and suffix your voucher numbers with GST-specific information. You can also choose
to restart voucher numbering by creating a new voucher type for GST.

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To create a new voucher type
● Go to Gateway of Tally > Accounts Info. > Voucher Types > Create.

Starting Number - 1, if you want a fresh batch of voucher numbers.

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You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

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Recording Purchase Returns in GST in
Tally.ERP9
You can record purchase returns (both local and interstate) against an earlier purchase
transaction using a debit note.

To record purchase return using a debit note

1. Go to Gateway of Tally > Accounting Vouchers > Ctrl+F9.

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2. Original invoice no: Enter the invoice number of the original purchase transaction against
which you are recording the purchase return.
3. In Party’s A/c Name, select the party from which the original purchase was made.
4. Select the central and state tax ledgers.
5. Provide GST details: Enable this option if you want to enter additional details about the
purchase return.

o 01-Sales Return - When there is a return of goods or services after sales.

o 02-Post sale discount - When discount is allowed on goods or services after sales.
o 03-Deficiency in service - When there is a deficiency in services (like a quality
issue) after sales.
o 04-Correction in invoice - When there is a change in the invoice raised that leads to
change in tax amount.
o 05-Change in POS - When there is a change in place of supply that leads to change
in tax amount.
o 06-Finalization of Provisional assessment - When there is a change in price or

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rate after the department issues a notification about the finalized price of the goods
or services.
o 07-Others - Any other nature of return.
Similarly, you can record purchase returns against an interstate purchase by selecting the
relevant party, purchase ledger, and integrated tax ledger.

Import of Services under Reverse Charge –

GST in Tally.ERP9
You can account for import of services, raise liability on the tax payable (reverse charge), and
claim tax credit.
Record inward supply of services as imports
Raise tax liability
Claim tax credit on the liability of imports

Recording inward supply of services as imports

You can record an inward supply of services that are imported, in a purchase invoice.
To record a purchase invoice
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.
2. Click I: Accounting Invoice.

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3. In the field Party's A/c Name, select the supplier ledger predefined with Country other
than India.
4. Select the service ledger grouped under Purchase Accounts, and enter the amount.
5. Press Ctrl+A to accept.

Claiming tax credit on the liability of imports

When you import services, you have to raise the tax liability in your books and then pay it to the
department. You can record a journal voucher to raise this liability under reverse charge.
You can claim the tax liability paid on imports as tax credit by recording a journal voucher. The
purchase invoice details with the tax credit claimed on the purchase is shown in GSTR-3B.
To record a journal voucher to raise tax liability
1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
3. Select the options as shown below.

4. Debit the ledger grouped under Current Assets and credit the integrated tax ledger.

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5. Press Enter to save.

To claim tax credit on liability of imports

1. In the journal voucher, click J: Stat Adjustment and set the options as shown below:

2. Debit the integrated tax ledger and credit the ledger grouped under Current Assets.

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3. Press Enter to save.
To view the transactions in GSTR-3B report
● Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR-3B.

You can record journal vouchers related to import of trading and capital goods as given below:

Nature of Adjustment Additional Details Ledgers to be used

Increase of Input Tax Import of Capital Debit: GST ledgers (integrated tax/state tax

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and central tax).
Goods Credit: Ledger grouped under Current
Assets.
Credit
Debit: GST ledgers (integrated tax/state tax
and central tax).
Import of Goods
Credit: Ledger grouped under Current
Assets.

Import of Capital Debit: Ledger grouped under Current

Increase of Tax Goods Assets.
Liability Credit: GST ledgers (integrated tax/state tax
Imports and central tax).

Import of Services under Reverse Charge –

Recording inward supply of services as imports

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Claiming tax credit on the liability of imports

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4. Debit the ledger grouped under Current Assets and credit the integrated tax ledger.

5. Press Enter to save.

To claim tax credit on liability of imports
1. In the journal voucher, click J: Stat Adjustment and set the options as shown below:

2. Debit the integrated tax ledger and credit the ledger grouped under Current Assets.

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3. Press Enter to save.
To view the transactions in GSTR-3B report
● Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR-3B.

You can record journal vouchers related to import of trading and capital goods as given below:

Nature of Adjustment Additional Details Ledgers to be used

Increase of Input Tax Import of Capital Debit: GST ledgers (integrated tax/state tax

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and central tax).
Goods Credit: Ledger grouped under Current
Assets.
Credit
Debit: GST ledgers (integrated tax/state tax
and central tax).
Import of Goods
Credit: Ledger grouped under Current
Assets.

Import of Capital Debit: Ledger grouped under Current

Increase of Tax Goods Assets.
Liability Credit: GST ledgers (integrated tax/state tax
Imports and central tax).

Import of Services under Reverse Charge –

Recording inward supply of services as imports

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Claiming tax credit on the liability of imports

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4. Debit the ledger grouped under Current Assets and credit the integrated tax ledger.

5. Press Enter to save.

To claim tax credit on liability of imports
1. In the journal voucher, click J: Stat Adjustment and set the options as shown below:

2. Debit the integrated tax ledger and credit the ledger grouped under Current Assets.

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3. Press Enter to save.
To view the transactions in GSTR-3B report
● Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR-3B.

You can record journal vouchers related to import of trading and capital goods as given below:

Nature of Adjustment Additional Details Ledgers to be used

Increase of Input Tax Import of Capital Debit: GST ledgers (integrated tax/state tax

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and central tax).
Goods Credit: Ledger grouped under Current
Assets.
Credit
Debit: GST ledgers (integrated tax/state tax
and central tax).
Import of Goods
Credit: Ledger grouped under Current
Assets.

Import of Capital Debit: Ledger grouped under Current

Increase of Tax Goods Assets.
Liability Credit: GST ledgers (integrated tax/state tax
Imports and central tax).

GST Purchases - Nil Rated, Exempt, SEZ,

and Works Contract in Tally.ERP9
Once you activate GST in your company, you can record a variety of purchase transactions
(inward supply) such as nil rated, exempt, and SEZ purchases using a purchase voucher.
1. Nil rated purchases
2. Exempt purchases
3. SEZ purchases
4. Purchase of works contract services

Selecting the purchase ledger in a purchase

transaction
While recording any type of purchase transaction, you can choose either of the following
methods:
● Method 1: For a specific type of purchase transaction, you can create or update the
purchase ledger with the relevant Nature of transaction. Now select this purchase
ledger while recording the purchase transaction.

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● Method 2: Select the common purchase ledger during the purchase transaction.
Press F12 and enable the option Allow modification of tax details for GST? Now
select the Classification/Nature.

1. Nil Rated Purchases

The purchase of nil rated goods from a local or interstate supplier does not attract GST, and can
be recorded using a purchase voucher. In the masters of the goods or services classified as nil
rated (0%), Taxability should be set to Nil Rated in the GST Detailsscreen.
● Go to Gateway of Tally > Accounting Vouchers > F9: Purchases.
● Select the applicable purchase ledger. For example, Nil Rated Purchases.

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Depending on the location of the party, you can record a local or interstate nil rated purchase
transaction.

2. Exempt Purchases
The local or interstate purchase of goods or services exempted from GST can be recorded using
a purchase voucher. In the masters of the exempted goods or services, Taxability should be set
to Exempt in the GST Details screen.
● Go to Gateway of Tally > Accounting Vouchers > F9: Purchases.
● Select the applicable purchase ledger. For example, Exempt Purchases.

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3. SEZ Purchases
The purchase of goods and services from a party in an SEZ can be recorded using a purchase
voucher. In an SEZ purchase transaction, taxes are applicable based on the type of purchase:
● Taxable SEZ purchase: In SEZ purchases, integrated tax is applicable for both local and
interstate parties.
● Exempt SEZ purchase: No tax is applicable.
● SEZ purchase under LUT/bond: No tax is applicable. SEZ purchases under LUT/bond
are allowed when your supplier has signed up a letter of undertaking with the department
for the sale of goods without the payment of duty. While passing the purchase
transaction, you can select either the ledger created for exempt SEZ purchases or the
common purchase ledger.
To record SEZ purchases
● Go to Gateway of Tally > Accounting Vouchers > F9: Purchases.
● Select the applicable purchase ledger. For example, SEZ Purchases.

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Provide GST details: Enable this option if you want to enter additional details regarding
the SEZ transaction.

4. Purchase of works contract services

To record a purchase invoice for works contract
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.

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Supplier invoice no.: Displays the sales invoice no. of the supplying party.
Date: Displays the date on which the sales invoice was passed by the supplier.
2. In Party A/c name, select the supplier's ledger.
3. Select the purchase ledger and enter the amount.
4. Select the GST ledgers (central and state, or integrated) based on the state selected for the
supplier ledger.
You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

GST Purchases - Nil Rated, Exempt, SEZ,

and Works Contract in Tally.ERP9

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Once you activate GST in your company, you can record a variety of purchase transactions
(inward supply) such as nil rated, exempt, and SEZ purchases using a purchase voucher.
1. Nil rated purchases
2. Exempt purchases
3. SEZ purchases
4. Purchase of works contract services

Selecting the purchase ledger in a purchase

● Method 2: Select the common purchase ledger during the purchase transaction.
Press F12 and enable the option Allow modification of tax details for GST? Now
select the Classification/Nature.

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1. Nil Rated Purchases
The purchase of nil rated goods from a local or interstate supplier does not attract GST, and can
be recorded using a purchase voucher. In the masters of the goods or services classified as nil
rated (0%), Taxability should be set to Nil Rated in the GST Detailsscreen.
● Go to Gateway of Tally > Accounting Vouchers > F9: Purchases.
● Select the applicable purchase ledger. For example, Nil Rated Purchases.

Depending on the location of the party, you can record a local or interstate nil rated purchase
transaction.

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Provide GST details: Enable this option if you want to enter additional details regarding
the SEZ transaction.

4. Purchase of works contract services

To record a purchase invoice for works contract
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.

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GST Purchases - Nil Rated, Exempt, SEZ,

and Works Contract in Tally.ERP9

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Selecting the purchase ledger in a purchase

● Method 2: Select the common purchase ledger during the purchase transaction.
Press F12 and enable the option Allow modification of tax details for GST? Now
select the Classification/Nature.

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Depending on the location of the party, you can record a local or interstate nil rated purchase
transaction.

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Provide GST details: Enable this option if you want to enter additional details regarding
the SEZ transaction.

4. Purchase of works contract services

To record a purchase invoice for works contract
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.

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Recording Local Purchase under GST in

TallyERP9

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Once you activate GST in your company, you can record the purchase of goods and services
that attract GST using a purchase voucher. Ensure that you provide unique voucher numbers
for your purchase vouchers, and use a new series of voucher numbering.
A. Local purchase
B. Interstate purchase
A. Local Purchase
The purchase of goods or services from a supplier in the same state attracts central tax and state tax.
Method-1 : To Record a Local Purchase Transaction
[ Using Common Ledger Account for all items with same Tax Rate]
During Purchase Voucher (F9) Entry Press F12 and Set YES as below :

As per our Practical Example No. 1

Purchase from Raj Infotech, 5 CDs of Antivirus Software @ Rs. 800 each, with Input GST rate @
18%. i.e. Rs.. 720 - [ CGST (9%) Rs.360 and SGST (9%) Rs.360 ]

1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.

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Supplier invoice no.: Displays the sales invoice no. of the supplying party.
Date: Displays the date on which the sales invoice was passed by the supplier.
2. In Party A/c name, select the supplier's ledger or the cash ledger.
3. Select the Purchase Ledger applicable for local taxable purchases.
4. Select the required Items, and specify the Quantities and Rates.
5. Select the central and state tax ledgers. As above.
You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

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As per our Practical Example No. 2
Purchase from Microtek India Ltd. , 10 Monitors @ Rs. 4000 each, with Input GST @ 28% i.e.
Rs.11,200 – [ CGST (14%) Rs.5600 and SGST (14%) Rs. 5600. ]

Method-2 : To Record a Local Purchase Transaction

[ Without Using Common Ledger Account for all items due to Different
Tax Rate ]
During Purchase Voucher (F9) Entry Press F12 and Set No as below :

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Examples :
Cash Purchase of 5 CDs of Antivirus Software @ Rs. 800 each , with Input GST rate @ 18%. & 2
Mi-Note 4 Mobiles @ Rs. 10,000 each with Input GST 12%

The Purchase Invoice will be entered as below with GST Analysis..

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Recording Outside Inter-State Purchase
under GST in TallyERP9
As per our Practical Example No. 3
Purchase 2 ‘Hp-Laptop’ @ Rs. 45,000 with Input IGST @ 18% i.e. Rs. 16,200
and
2 Mi-Note 4 Mobiles @ Rs. 10,000 each with Input IGST 12% i.e. Rs.2,400 – in Cash from
Outside State – West Bengal from Registered Shop.

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In the above example…Purchase of Multiple Items GST Rates in one Purchase Bill.
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchase.
Press F12 : Make ‘No’ to Use common ledger account for item allocation as follow :

● Follow the steps used for recording a local purchase transaction, with the following
changes:
o In Party A/c name, select Cash ledger i.e. Cash .
The Supplementary Details should be as below with Address, State, GST Registration
Type , GSTIN/UIN & Type of Dealer :

o Select the purchase ledger applicable for interstate purchases for each item i.e.
Inter-state Purchase @ 18% for Hp-Laptop & Inter-state Purchase @ 12% for Mi Note 4
Mobiles.

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o Select the integrated tax ledger i.e. Input IGST.

Depending on the location of the supplier, you can record a local or interstate purchase
transaction with the applicable GST rates
You can view the tax details by clicking A: Tax Analysis. Click F1: Detailed to view the tax
break-up.

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Creating Sales Ledgers for GST in
Tally.ERP9

Creating a Sales Ledger (Local) : GST Sales

To Create a Sales Ledger i.e. GST Sales
1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create.
2. Enter the Name of the Sales ledger i.e. GST Sales
3. Select Sales Account from the List of Groups in the Under field.
4. Set the option Inventory values are affected? to Yes ,.
5. Is GST Applicable - Applicable.
6. Set / alter GST Details – No
7. Type of Supply - Goods

8. Press Ctrl + A to save.

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Creating Purchase Ledgers for GST in
Tally.ERP9

Creating a Purchase Ledger : Purchase @ 18%

To Create a Purchase Ledger i.e. Purchase @ 18%
1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create.
2. Enter the Name of the Sales ledger i.e. Purchase @ 18%
3. Select Purchase Account from the List of Groups in the Under field.
4. Set the option Inventory values are affected? to Yes ,.

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5. Is GST Applicable - Applicable.

6. Set/alter GST Details - Yes, specify the details in the GST Details screen as below ,
and Save.

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● Follow the steps used for Creating the Purchase Ledger i.e. Purchase @ 18% as above,
with the nature of transaction and rates for purchase.
Similarly…you can create all following Purchase Ledgers as per our Practical Examples by
specify the Tax Rate and other GST details as above :

o Purchase @ 28%
o Purchase @ 12%
o Purchase @ 5%

Creating Purchase Ledgers for GST in

Tally.ERP9

Creating a Purchase Ledger : Purchase @ 18%

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5. Is GST Applicable - Applicable.

6. Set/alter GST Details - Yes, specify the details in the GST Details screen as below ,
and Save.

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o Purchase @ 28%
o Purchase @ 12%
o Purchase @ 5%

Setting Up GST Rates for stock groups and

stock items in Tally.ERP9
Quickly set up GST rates for your company, stock item-wise or stock group-wise, using the GST
Rate Setup option. You must enable GST in your company to provide GST rates. You can set up
GST rates at the company level, stock group level, stock item level, ledger group level, and
ledger level. You can also set the GST rates for a particular price range/slab for multiple stock
items.
To set GST rates for stock groups and stock items
1. Go to Gateway of Tally > Display > Statutory Reports > GST > GST Rate Setup.

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Note: Brackets indicate that tax rates are captured from the company or stock group level.
2. Select the stock group or stock item, and press Alt+S to provide the applicable tax rates.
You can press Spacebar to select multiple stock groups or stock items. Set the tax rates
and save.

The rate entered for integrated tax will be equally divided between central tax and
state tax.
To view the history of tax rate changes, press Alt + L.
To specify further GST-related details, click F12: Configure.
In order to remove a tax rate, use the option Ctrl+C (Clear Rate). You can clear rate of multiple
items or groups by selecting them using Spacebar. You can also clear rate from items under a
group and automatically infer tax details recorded at group level to sub-groups and items using
the option F: Enforce Rate.

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Activating GST in Tally.ERP9 for your
Company
To use Tally.ERP 9 for GST compliance, you need to activate the GST feature. Once activated,
GST-related features are available in ledgers, stock items, and transactions, and GST returns
can be generated.
To activate GST
1. Open the company for which you need to activate GST.
2. Press F11 > F3.

3. Enable Goods and Services Tax (GST) - Yes.

4. Set/alter GST details - Yes.

State: Displays the state you have selected for your company. Helps in identifying local and
interstate transactions. If you change the state, it will be updated in the company details.

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5. Specify the GSTIN/UIN for the business. This can be printed in the invoices as required.
You can specify this later.
6. Specify Applicable from date. GST will be applicable for your transactions from this date
onwards.
You can record transactions using the ledgers with GST details, and print invoices with GSTIN.
If required, deactivate other taxes like VAT, as applicable. For this, open the corresponding tax
details screen and specify the Deactivate from date.

Providing GST-Related information in GST

Screen in Tally.ERP9
You can specify all GST-related information relating to your business in the GST Details screen.
This screen can be configured to enable further options which will allow you to enter your GST
information in detail.
To specify GST details, enable the option Set/alter GST details?. You can manage GST
details for goods/services at different levels.
If you have enabled GST classification at the company level, you can select it in the
field Classification. Once you have selected a GST classification, the details specified get
applied to stock item, stock group or ledger.
The GST Details screen at the stock item level appears as shown below:

Note: The option Calculation type is available only at the stock item level. You can set the

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calculation type as On Value or On Item Rate, as required.

F12: Configure
The F12 configuration options available at the stock item, stock group, and ledger levels, and the
options enabled on setting them to Yes in the GST Details screen are shown below:

Valuation Type: Default is Based on Value.

You can enable the F12 configuration options as required to enable relevant options and provide
the required details.

Sales Inclusive of Tax in Tally.ERP9

Create sales voucher to record sales inclusive of duties and taxes.

To record sales inclusive of tax

1. Go to Gateway of Tally > Accounting Vouchers > F8: Sales.

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2. Select the party ledger in Party's A/c Name field.
3. Select the sales ledger with taxable nature of transaction.
4. Select the stock item for which the option Is inclusive of duties and taxes? is enabled.
5. Enter the Quantity. The Inclusive of Tax screen appears as shown below:
o Enter the Rate (Inclusive of Tax).

o Press Enter to save and to return to sales invoice.

Note:You can enable an additional column in the invoice to enter the stock item value, which
is inclusive of tax.
6. Select the common VAT ledger.
● The ledger must be grouped under Duties & Taxes in which the options:
o Type of duty/tax set to VAT (CST in case of interstate sales).
o Percentage of Calculation (eg 5)? set to 0.
7. Enter Narration, if required.
The sales invoice appears as shown below:

8. Press Enter to save.

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Generating GSTR-1 Report in Tally.ERP9
GSTR-1 is the monthly GST return to be filed by a taxable person registered under GST. GSTR-1
includes the details of all outward supplies made in the given period.
The outward supply details include B2B invoices, B2C invoices, adjustments to sales made in
debit/credit notes, exports, nil rated invoices, advances received with tax adjustments.
Note: Ensure that you download and install the latest version of the GST Offline Tool for filing
returns.

To view the report in the format provided by GST

● Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR–1. If the report is not
appearing in the format shown below, press Alt+V.

Note: You can press Alt+A in GSTR-1 report to change the view from return format to summary
view and vice-versa.
● Specify the required reporting period by pressing F2.
By default, the transactions having voucher numbers more than 16 characters, including special
characters ("-" and "/") are not exported to the e-return template. To include these vouchers,
use F12: Configure.

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● You can generate the report with the line HSN/SAC Summary by enabling the option Show
HSN/SAC Summary?.
● You can generate the HSN/SAC Summary report with only the description or HSN or both,
based on the grouping set in the option Group vouchers by.
In the return format view, there are two sections in the report:
● Returns summary - a snapshot of the business operations in the given period.
● Particulars - structured as per the offline tool provided by the department.
To view the report in summary view
● Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR–1. If the report is not
appearing in the format shown below, press Alt+V. Displays the local and interstate transactions
grouped on GST and non-GST outward supplies.

In the summary view, there are two sections in the report:

● Returns summary - a snapshot of the business operations in the given period.
● Particulars - displays the taxable value and tax amount from outward supplies considered in the
returns.
F12: Configure

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Show break-up of nett values?: Enable this option to display Gross Value, Returns, and
Addition/Deduction values in detailed mode of the report. This option is disabled by default.
Show tax types in separate columns?: Enable this option to view all GST tax types in separate
columns. This option is enabled by default. When this option is displayed, tax amount is displayed in
a single column without the Central Tax, state tax and integrated tax break-up.
Export vouchers with voucher number more than 16 characters?: Enable this option to export
the transactions having more than 16 characters, including special characters ("-" and "/") to the
template.
Round-off margin: It is set to 1. You can change it as required to ensure the relevant transactions
are included in the returns.

GSTR-1 Returns Transactions Summary

This section provides a summary of all transactions recorded in the reporting period. You can drill
down on each row to view the details.

Total number of vouchers for the period

Drill down shows the Statistics report, listing the vouchers participating in the GST return.

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Included in returns
Drill down from this row to view the Summary of Included Vouchers report, with the list of voucher-
types with voucher count.

Not relevant for returns

Drill down from this row to view the Summary of Excluded Vouchers report, with the transaction
type-wise voucher count.

Other transaction types that can appear under excluded vouchers:

● Excluded by User: Manually excluded by you from the list of included or uncertain transactions.
Drill down and use I: Include Vouchers, if required. Based on the information in the voucher it will
move to either included or uncertain.

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● Contra Vouchers: The count of contra entries which involve only bank and cash ledgers.
● Order Vouchers: The count of sales order, purchase order, job work in order, and job work out
order vouchers.
● Inventory Vouchers: The count of receipt note, stock journal, delivery note, material in, material
out, rejections in, rejections out, and physical stock vouchers as they are purely inventory in nature
and do not attract GST.
● Payroll Vouchers: The count of transactions recorded using payroll and attendance vouchers.
GST does not apply to these transactions.
● No GST Implications: The count of receipts, payments, and journal vouchers that do not have
any GST implication.
● Other voucher: The count of memorandum and reversing journal vouchers.
● Non GSTR-1 Transactions: The transactions which are part of other returns, for example: GSTR
– 2, and hence will not have any implication on GSTR – 1.
All the transaction types are not displayed by default. Based on the voucher type used and the
exclusions done by you, the relevant categories appear with the voucher count.
Incomplete/mismatch in information (to be resolved)
The count of all vouchers with insufficient GST-related information. You can correct exceptions in the
vouchers before exporting GST returns.

The exceptions are listed in the order of priority, based on the importance of the information for
generating returns. You need to update the missing information and resolve the mismatches to
include these in the returns.

Table-wise View in the GSTR-1 Report in

TallyERP9
GSTR-1 report can be viewed in the table-wise format. The table-wise report is structured in line with the GSTR-1
format given by the department.

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To view the report in table-wise format
● Click V: Table-wise View in the GSTR-1 report.

By default the table-wise format displays rows related to values for current reporting period. And rows of previous
period amendments, if values are available. To view all the amendment rows, enable the option Show amendment
tables with zero values? under F12: Configure.

Given below is the description of different tables.

Table name Description

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● Taxable
● Exempt
● Nil Rated
Registration type as
● Regular
● Composite
● Unknown (with GSTIN)

5A Amendments to Displays amendments to details of outward supplies to a registered person

B2B Invoices of earlier tax periods.

6A Amendments to Displays amendments to details of taxable outward supplies to a consumer

B2C(Large) Invoices where place of supply is other than the state where supplier is located
(Inter-state supplies) and invoice value is more than Rs 2.5 lakh of earlier
tax periods.

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· Interstate Sales Nil Rated
· Sales to Consumer – Taxable
· Sales to Consumer – Exempt
Taxability as:
· Taxable
· Exempt
· Nil Rated

Registration Type as:

· Unregistered
· Consumer
· Unknown (with GSTIN)
and invoice value of less than 2.5 lakhs are captured in this table.

7A Amendments to Displays amendments to details of taxable value and tax amount from
B2C(Small) Invoices taxable outward supplies to consumer (Other than captured in table 6) of
earlier tax periods.

8A Amendments to Displays amendment to details of credit and debit notes of earlier tax
Credit/Debit Notes periods.

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● Unregistered
● Unknown

10A Amendments to Displays details of amendments to supplies exported of earlier tax periods.
Exports Invoices

11A Amendments to Displays details of amendments to tax liability arising on account of time of
Tax Liability on supply without issuance of invoice in the same period.
Advances

GSTR-1 Computation Details in Tally.ERP9

This section displays the transaction values included in the returns along with the amount of
adjustments, and GST payable or refundable. The taxable amount, and tax amount under each
GST tax type are displayed under respective columns for the specific period. Drill-down reports are
provided for all sales and GST adjustments up to the transaction level.

Outward Supplies
Total outward supplies (local and interstate), which include taxable value, and the corresponding tax
amount are displayed here. The total local and interstate sales are divided
into Taxable and Exempted. To view all the sales transactions,
1. Click F1: Detailed to display the report in detailed mode.
2. Select any of the rows displayed in italics, under Local Sales or Interstate Sales.
3. Press Enter to display the Voucher Register screen, as shown below:

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You can view this report ledger wise or commodity wise by clicking L: Ledger-wise or S: Stock
item-wise, and A: Party-wise respectively.

GSTR-1 Returns Summary in Tally.ERP9

Total number of vouchers for the period

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Not relevant for returns
Displays the count of all vouchers which are not part of returns, as GST details are not provided in
these vouchers. These vouchers will have no implication on returns. Drill down from this row to view
Summary of Excluded Vouchers report, with transaction type-wise voucher count. The Summary of
Excluded Vouchers report appears as shown:

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GSTR – 2, and hence will not have any implication on GSTR – 1. Drill down to view all the GSTR-2
related purchase transactions.
All the transaction types are not displayed by default. Based on the voucher type used and the
exclusions done by user, the relevant categories appear with the voucher count.
Incomplete/mismatch in information (to be resolved)
Displays the count of all vouchers with insufficient GST related information. These are exceptions
that need to be resolved for the vouchers to be included in the returns. Drill down from this row to
view the list of exception types and number of exceptions under each type. These exceptions can be
resolved right away, without having to alter vouchers or update masters one by one.

GSTR-1 Summary of Exceptions Report in

Tally.ERP9

Vouchers with incomplete/mismatch in information list includes voucher that contain GST
details but are not included in the count of Included in returnsand Not relevant for returns due to
incomplete information or mismatch.
You can correct exceptions in the vouchers before exporting GST returns. The Vouchers with
incomplete/mismatch in information report appears as shown below:

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2. UoM(s) not mapped to Unit Quantity Code (UQC)
3. Country, state and dealer type not specified
4. Tax rate/tax type not specified
5. Nature of transaction, taxable value, rate of tax modified in voucher
6. Incorrect tax type selected in tax ledger
7. Mismatch due to tax amount modified in voucher
8. Voucher with incomplete/incorrect adjustment details
9. Information required for generating table-wise details not provided
10. Exception Types
11. Filter for Item level and Ledger level exceptions
11.1. Item Exceptions
11.2. Ledger Exceptions

However, vouchers with only one exception are moved to Included in returns list after that
exception is resolved.

1. No. of voucher with incomplete/mismatch in information

To resolve all exceptions without having to go from one exception type

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3. Select any transaction and press Enter to display the Voucher Details Alteration screen which
is divided into multiple sections, one for each exception in the voucher, as shown below:

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Resolution screen.
Note: Click X: Exclude Vouchers in the Exception Resolution screen to exclude the voucher from
GSTR-1 return.

2. UoM(s) not mapped to Unit Quantity Code (UQC)

Displays the count of transactions for which Unit Quantity Code is not mapped with the unit of
measure.

To resolve this exception

o Press Enter to save.

● Selecting UQC in the stock item master
o Press Enter on the selected UoM Symbol.
o Select the Unit Quantity Code (UQC), as shown below:

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o Press Enter to save.

3. Country, state and dealer type not specified

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Resolution screen appears.
3. Select the state, specify the GSTIN and select dealer type for each transaction.

4. Press Ctrl+A to accept.

Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-1 return.

4. Tax rate/tax type not specified

Displays the count of transactions for which the rate or tax type is not selected in the item/ledger
master.

To resolve this exception

1. Select the exception Tax rate/tax type not specified.
2. Press Enter. All the transactions of the exception type are displayed. The Exception
Resolution screen appears as shown below:

3. Select the Nature of transaction, if not provided.

4. Enter Rate, as required for each transaction.
5. Press Enter to save.
Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-1 return.

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3. Select the required voucher.

4. Click R: Resolve to select Nature of transaction and enter other details manually, or click A:
Accept as is. A message is displayed as shown below:

5. Press Enter to accept.

6. Similarly, accept the required vouchers.
7. Press Ctrl+A to accept.

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6. Incorrect tax type selected in tax ledger
Displays count of transactions in which type of duty is invalid.

To resolve this exception

1. Select the exception Incorrect tax type selected in tax ledger.
2. Press Enter. All the transactions of the exception type are displayed, as shown below:

3. Select the tax type for each transaction.

4. Press Enter to save.

7. Mismatch due to tax amount modified in voucher

Displays the count of transactions in which difference is found between the calculated and entered
tax amount. The mismatch due to modified value can be resolved by following one of the options.

To resolve this exception

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o Press Enter to accept. Similarly, accept the required vouchers.

● Recompute
o Navigate to required transaction and press Enter.
o Click F5: Recompute to recalculate the tax amount.

o Press Ctrl+A to accept. Similarly, recompute the required vouchers.

8. Voucher with incomplete/incorrect adjustment details

Displays the count of journal transactions in which Nature of adjustment is not selected.

To resolve this exception

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1. Select the exception Voucher with incomplete/incorrect adjustment details.
2. Press Enter. All transactions are displayed of a particular exception are listed, as shown below:

3. Select the Nature of adjustment and Additional details for each voucher.
4. Press Ctrl+A to accept.

9. Information required for generating table-wise details not

To resolve all exceptions without having to go from one exception type

3. Select any voucher and press Enter to display the Table-wise exceptions(s) screen, as shown
below:

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4. Enter the missing information or update the incorrect details, and press Enter to return to
the Exception Resolution screen.
5. Select the next voucher to update the required details and continue.

10. Exception Types

To resolve all party ledger level exceptions

6. Press Ctrl+A to accept.

To resolve all configuration level exceptions

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4. Select Configuration Level Corrections in the Select Exception Resolution Type screen.

5. Enter HSN/SAC code for the listed vouchers.

6. Press Ctrl+A to accept.
Drill-down from any row and resolve the respective exceptions to include the vouchers in return.

11. Filter for Item level and Ledger level exceptions

11.1. Item Exceptions

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4. Enter HSN/SAC, and tax rate.

2. Navigate to required exception type and press Enter from Total Masters column to
display Exception Resolution screen, as shown below:

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3. Select Nature of transaction.
4. Enter Rate.
5. Press Ctrl+A to accept.

11.2. Ledger Exceptions

To update the information and resolve exception at master level

1. Click L: Ledger Exceptions.

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2. Navigate to required exception type and press Enter from Total Masters column to display Multi
Ledger Alteration screen, as shown below:

3. Enter HSN/SAC, and tax rate.

2. Navigate to required exception type and press Enter from Total Vouchers column to
display Exception Resolution screen, as shown below:

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3. Select Nature of transaction and enter rate.
4. Press Ctrl+A to accept.

Resolving Incomplete/Mismatch in
Information (GSTR-1) in Tally.ERP9
If a voucher has multiple exceptions, on resolving one exception it will move to the next exception
category until all exceptions are resolved and entries moved to Included in Returns.
To resolve all exceptions
1. Drill down on No. of voucher with incomplete/mismatch in information.

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The Exception Resolution screen appears as shown below:

2. Select any transaction and press Enter.

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3. Select or enter required information for the first exception type. Further, you can click F5:
Recompute or A: Accept as is to recompute or accept the details, respectively.
4. Repeat steps 1, 2, and 3, until all exceptions are resolved.
Note: Click X: Exclude Vouchers in the Exception Resolution screen to exclude the voucher from
GSTR-1 return.
To resolve the exception: UoM not mapped to Unit Quantity Code (UQC)
1. Select the exception UoM not mapped to Unit Quantity Code (UQC).

2. Select the UoM Symbol.

● Exclude from Summary
o Click X: Exclude from Summary to exclude the transactions involving these unit of
measurements from the HSN/SAC Summary report.
o These transactions will appear under the Not included in HSN/SAC Summary (UQC not
available) section of HSN/SAC Summary report.
o The transactions will get included in the relevant sections of the GST return.
● Mapping with UQC from the report
o Click S: Map with UQC, select the UQC, and press Enter.

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● Selecting UQC in the stock item master
o Press Enter on the selected UoM Symbol, and select the Unit Quantity Code (UQC).

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o Press Enter to save.
To resolve the exception: Country, state and dealer type not specified
Displays the count of transactions where,
● Country/state is not selected in the party ledger master,
● State selected in transaction and party ledger are different, or
● Nature of transaction is not derived.
1. Select the exception Country, state and dealer type not specified.
2. Press Enter. All the transactions of the exception type are displayed. The Exception
Resolution screen appears.

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3. Select the state, specify the GSTIN and select dealer type for each transaction.

4. Press Ctrl+A to accept.

Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-1 return.
To resolve the exception: Tax rate/tax type not specified
Displays the count of transactions for which the rate or tax type is not selected in the item/ledger
master.
1. Select the exception Tax rate/tax type not specified, and press Enter.

2. Select the Nature of transaction, if not provided.

3. Enter Rate, as required for each transaction.
4. Press Enter to save.
Note: Click X: Exclude Vouchers to exclude the voucher from GSTR-1 return.

To resolve the exception: Nature of transaction, taxable value, rate of

tax modified in voucher
Displays count of transactions in which the Nature of transaction, taxable value or rate of tax
defined in the ledger master has been changed in the transaction.

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1. Select the exception Nature of transaction, taxable value, rate of tax modified in voucher,
and press Enter.

2. Select the required voucher.

3. Click R: Resolve to select Nature of transaction and enter other details manually, or click A:
Accept as is. A message is displayed as shown below:

4. Press Enter to accept.

5. Similarly, accept the required vouchers.
6. Press Ctrl+A to accept.
To resolve the exception: Incorrect tax type selected in tax ledger
Displays count of transactions in which type of duty is invalid.
1. Select the exception Incorrect tax type selected in tax ledger, and press Enter.

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2. Select the tax type for each transaction.
3. Press Enter to save.
To resolve the exception: Mismatch due to tax amount modified in
voucher
Displays the count of transactions in which difference is found between the calculated and entered
tax amount. The mismatch due to modified value can be resolved by following one of the options.
1. Select the exception Mismatch due to tax amount modified in voucher, and press Enter.
Based on your accounting requirements, you can resolve the mismatch, accept the transaction as is,
or recompute the tax values.
2. Navigate to the required transaction, and do one of the following:
o Click R: Resolve, enter the tax value in As per transaction column of the voucher, and
press Ctrl+A to accept.

o Click A: Accept as is, and press Enter to confirm acceptance.

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o Click F5: Recompute to recalculate the tax amount, and press Ctrl+A to accept.

To resolve the exception: Voucher with incomplete/incorrect adjustment

details
Displays the count of journal transactions in which Nature of adjustment is not selected.
1. Select the exception Voucher with incomplete/incorrect adjustment details, and press Enter.

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2. Select the Nature of adjustment and Additional details for each voucher.
3. Press Ctrl+A to accept.
To resolve the exception: Information required for generating table-wise
details not provided
Displays the count of transactions excluded from table-wise format of GSTR-1 due to incomplete
information. The button Exception Types is provided to resolve all party ledger level or voucher
level corrections from a single screen.
1. Select Information required for generating table-wise details not provided, and press Enter.

2. Select any voucher and press Enter to display the Table-wise exceptions(s) screen.

3. Enter the missing information or update the incorrect details, and press Enter to return to
the Exception Resolution screen.
4. Repeat step 3 for all the required vouchers.
Exception Types
Using this option you can resolve exceptions from a common screen by grouping all table-wise
related exceptions into two buckets Party Ledger level Corrections and Configuration Level
Corrections.
To resolve all party ledger level exceptions
1. Select Information required for generating table-wise details not provided, and press Enter.
2. Press Ctrl+E.

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3. Select Party Ledger Level Corrections in the Select Exception Resolution Type screen.
4. Enter party GSTIN number for the listed parties in the Party Ledger Level correction screen.

Note: The Contact person, Phone number, Mobile number and E-mail columns will appear as
per the details provided in the party ledger (by enabling the option Provide contact details in
configuration screen of party ledger).
5. Press Ctrl+A to accept.
To resolve all configuration level exceptions
1. Select Information required for generating table-wise not provided, and press Enter.
2. Press Ctrl+E.

3. Select Configuration Level Corrections in the Select Exception Resolution Type screen.

4. Enter HSN/SAC code for the listed vouchers.

5. Press Ctrl+A to accept.
Drill-down from any row and resolve the respective exceptions to include the vouchers in return.

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Data Captured in GSTR-1 e-Return in
Tally.ERP9
GSTR-1 return can be exported in the e-return format for any given period. All the transactions that
are displayed under Included in returns section in GSTR-1 report will be exported.
The e-return created on export of GSTR-1 is in line with the format prescribed by the department.
The file can be imported to the offline utility tool. This tool then creates the JSON file that can be
uploaded on the GST portal. Click here for the complete procedure on filing GSTR-1.
Note: The e-Return file has provision to capture the taxable value and tax rate but not the tax
amount. Hence, the tax amount is not exported to the e-Return file. Tax value is automatically
calculated after upload to the portal based on rate, taxable value and place of supply.
The description of the sheet and columns in the exported file is given below:

Worksheet and Description

column names

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b2b Displays the details of 1 B2B invoices - 4A, 4B, 4C, 6B, 6C table of GSTR-
1 report.
Taxable sales made to regular and composite dealers are captured here. If
your tax invoice had exempt and nil rated items along with taxable items,
then the total invoice value is captured here.
If you want to capture the values of only the taxable items as a B2B invoice,
as per GST rules record separate invoices for taxable items. Use separate
invoices (bill of supply) for sales of exempt/nil rated items.
Displays the value of sales recorded with:
Nature of transaction as
● Sales Taxable
● Interstate Sales Taxable
● Sales Exempt
● Interstate Sales Exempt
● Sales Nil Rated
● Interstate Sales Nil Rated
● Sales to SEZ - Exempt
● Sales to SEZ - LUT/Bond
● Sales to SEZ - Taxable
● Deemed Exports Exempt
● Deemed Exports Taxable
Taxability as
● Taxable
● Exempt
● Nil Rated
Registration type as
● Regular
● Composite

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GSTIN/UIN of Displays the following:
Recipient
● The GSTIN/UIN predefined for party ledgers, or entered in the Party
Details screen of the voucher.
● The GSTIN/UIN entered for the buyer in the Buyer's Details section of
the Party Detailsscreen when consignee and buyer details are provided.
● The GSTIN/UIN entered in the Party Detailsscreen of receipt voucher,
when a sales transaction is recorded in receipt voucher.

Invoice Number Displays the voucher number of the outward supply transactions.
Special characters other than "-" and "/" in the voucher number are not exported.
If the length of the voucher number is more than 16 characters, including the
special characters, offline tool will display a validation error.

Invoice date Displays the voucher date of the sales transaction.

Invoice Value Displays the total value of the voucher including tax and cess.

Place Of Supply Displays the State Name and state Code based on the Place of Supply of the
buyer in the Party Details screen of the voucher.

Reverse Charge Displays Y if it is a reverse charge transaction, else N.

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Invoice Type Displays Regular for vouchers recorded with the following Nature of
transaction:
● Sales Taxable
● Interstate Sales Taxable
● Sales Exempt
● Interstate Sales Exempt
● Sales Nil Rated
● Interstate Sales Nil Rated
Displays SEZ supplies with payment for vouchers recorded with Sales to
SEZ - Taxable as the nature of transaction.
Displays SEZ supplies without payment for vouchers recorded with the
following Nature of transaction:
● Sales to SEZ - Exempt
● Sales to SEZ - LUT/Bond
Displays Deemed Exp for vouchers recorded with the following nature of
transactions:
● Deemed Exports Taxable
● Deemed Exports Exempt

E-Commerce Displays the GSTIN/UIN of the e-commerce operator party selected in the
GSTIN voucher.
Displays the GSTIN/UIN of the buyer selected in the Party Details screen of the
voucher, in the GSTIN/UIN of Recipient column of this worksheet.
Note: The GSTIN/UIN of the e-commerce operator party selected in the
voucher, and the GSTIN/UIN entered in Party Details screen of the voucher
should be different.

Rate Displays the integrated tax rate with decimal places.

If the stock item is nil rated or exempt, the tax rate appears as 0.00.

Taxable Value Displays the assessable value entered for each tax rate.

Cess Amount Displays the cess amount of the voucher.

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b2cl Displays the details of table 2 B2C(Large) Invoices - 5A, 5B of GSTR-1 report.
Displays the value of sales recorded with:
● Nature of transaction
o Interstate Sales Taxable
o Interstate Sales Exempt
o Interstate Sales Nil Rated
● Registration Type as
o Unregistered
o Consumer
● Unregistered party selected in the Party Detailsscreen for sales made by
selecting e-commerce operator in the Party's A/c Name field.
● When the taxable stock item is selected along with exempted or nil-rated goods,
then the values are captured here. If only exempted or nil rated goods are selected,
it will appear under the Nil Rated Invoices table of GSTR-1report.
● Interstate sales of more than Rs. 2,50,000 to unregistered dealers and
consumers are captured here.

Invoice Displays the voucher number of the outward supply transaction.

Number Special characters other than "-" and "/" in the voucher number are not exported.
If the length of the voucher number is more than 16 characters, including the special
characters, the offline tool will display a validation error.

Invoice date Displays the voucher date of the sales transaction.

Invoice Value Displays the total value in the invoice including tax and cess.

Place Of Displays the State Name and state Code based on the Place of Supply of the buyer
Supply in the Party Details screen of the voucher.

Rate Displays the integrated tax rate with decimal places.

If the stock item is nil rated or exempt, the tax rate appears as 0.00.

Taxable Displays the assessable value entered for each tax rate.
Value

Cess Amount Displays the cess amount of the voucher.

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E-Commerce Displays the GSTIN/UIN of the e-commerce operator party selected in the
GSTIN voucher.

Displays the details of table 3 B2C(Small) Invoices - 7 of GSTR-1 report.

Displays the net values of sales, for transactions recorded with:
b2cs ● Nature of transaction as:
o Sales Taxable
o Sales to Consumer – Taxable
o Sales to Consumer – Exempt
o Sales Nil Rated
o Interstate Sales Nil Rated
o Sales Exempt
o Interstate Sales Exempt
o Interstate Sales Taxable
● Taxability as:
o Taxable
o Exempt
o Nil Rated
● Registration Type as:
o Unregistered
o Consumer
● Unregistered party selected in the Party Detailsscreen for sales made by
selecting e-commerce operator in the Party's A/c Name field.
● Interstate sales of equal to or less than Rs. 2,50,000 to unregistered dealers
and consumers are captured here.

Type Displays E for e-commerce party and OE for others.

Place Of Displays the State Name and state Code based on the Place of Supply of the
Supply buyer in the Party Details screen of the voucher.

Rate Displays the integrated tax rate with decimal places.

If the stock item is nil rated or exempt, the tax rate appears as 0.00.

Taxable Value Displays the assessable value entered for each tax rate.

Cess Amount Displays the cess amount of the voucher.

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E-Commerce Displays the GSTIN/UIN of the e-commerce operator party selected in the voucher.
GSTIN

cdnr Displays the details of table 4 Credit/Debit Notes (Registered) -

9B of GSTR-1 report.
Displays the values of credit and debit notes recorded in the reporting period
with the following details:
Nature of transaction as:
● Sales Taxable
● Interstate Sales Taxable
● Sales Exempt
● Interstate Sales Exempt
● Sales Nil Rated
● Interstate Sales Nil Rated
● Sales to SEZ - Taxable
● Sales to SEZ - Exempt
● Sales to SEZ - LUT/Bond
● Deemed Exports Taxable
● Deemed Exports Exempt
Taxability as:
● Taxable
● Exempt
● Nil Rated
Journal voucher recorded by debiting GST ledgers with:
● Nature of Adjustment- Decrease of Tax Liability
● Additional Details - Cancellation of Advance
Receipts or Cancellation of Advance Receipts for Exports/SEZ sales

GSTIN/UIN of Displays the GSTIN/UIN entered in the Party Details screen of the
Recipient debit/credit note.
Displays the GSTIN/UIN entered in the Statutory Details screen of the
journal voucher recorded for the cancellation of advance receipt.

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Invoice/Advance Displays the Original invoice no. entered in the debit/credit note.
Receipt Number Displays the Advance Receipt Number entered in the Statutory
Details screen of the journal voucher recorded for the cancellation of
advance receipt.
Special characters other than "-" and "/" in the Original invoice
no. or Advance Receipt Number are not exported.
If the length of the Original invoice no. or Advance Receipt Number is
more than 16 characters, including special characters, the offline tool will
display validation error.

Invoice/Advance Displays the Original Invoice Dt. of debit/credit note.

Receipt date Displays the Advance Receipt Date entered in the journal voucher recorded
for the cancellation of advance receipt.

Note/Refund Voucher Displays the voucher number of debit/credit note.

Number
Displays the Refund Voucher Number entered in the journal voucher
recorded for the cancellation of advance receipt.

Note/Refund Voucher Displays the debit/credit note date.

date
Displays the Refund Voucher Date entered in the journal voucher
recorded for the cancellation of advance receipt.

Document Type Displays the document type based on the voucher type:
● C for Credit Note
● D for Debit Note
● R for journal voucher

Reason For Issuing Displays the Nature of Return selected in the Statutory Details screen
document of credit note and debit note.
When the transaction is recorded in journal voucher, the reason appears
as 07-Others.

Place Of Supply Displays the State Name and state Code based on the Place of Supply of
the buyer in the Party Details screen of the voucher.
Displays the Place of Supply entered in the Statutory Details screen of the
journal voucher recorded for the cancellation of advance receipt.

Note/Refund Voucher Displays the total value of the voucher.

Value

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Rate Displays the integrated tax rate with decimal places.
If the stock item is nil rated or exempt, the tax rate appears as 0.00.

Taxable Value Displays the assessable value entered for each tax rate.

Cess Amount Displays the cess amount of the voucher.

Pre GST Displays Y if the Original Invoice Dt. entered is prior to 1-Jul-2017,
else N.

Displays the details of table 5 Credit/Debit Notes (Unregistered) -

9B of GSTR-1 report.
cdnur Displays the values of credit and debit notes, recorded in the reporting
period with the following details:
Nature of transaction as
● Interstate Sales Taxable and Interstate Sales Exempt -
sales returns made against 2 B2C(Large) Invoices - 5A, 5B table
● Exports Taxable
● Exports LUT/Bond
● Exports Exempt
Journal voucher recorded by debiting GST ledgers with:
● Nature of Adjustment - Decrease of Tax Liability
● Additional Details - Cancellation of Advance
Receipts or Cancellation of Advance Receipts for Exports/SEZ sales

UR Type Displays:
● B2CL if the nature of transaction is of interstate sales.
● EXPWP, if the nature of transaction is selected as Exports
Taxable and Exports Exempt.
● EXPWOP, if the nature of transaction is selected as Exports
LUT/Bond.

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Note/Refund Voucher Displays the voucher number of payment, debit note, and credit note.
Number
Displays the Refund Voucher Number entered in the journal voucher.
Special characters other than "-" and "/" in the Original invoice no. are not
exported.
If the length of the Original invoice no. is more than 16 characters,
including special characters, the offline tool will display a validation error.

Note/Refund Voucher Displays the voucher date of payment, debit note, and credit note.
date
Displays the Refund Voucher Date entered in the journal voucher.
The voucher number entered in the GST Details screen of journal
voucher appears here.

Document Type Displays the document type based on the voucher type:
● C for Credit Note
● D for Debit Note
● R for journal voucher

Invoice/Advance Displays the original invoice number of sales or advance receipt linked to
Receipt Number credit note and debit note.
Displays the Advance Receipt Number entered in the Statutory
Details screen of journal voucher.
Special characters other than "-" and "/" in the Original invoice no. are not
exported.
If the length of the Original invoice no. is more than 16 characters,
including special characters, the offline tool will display a validation error.

Invoice/Advance Displays the original voucher date of sales or advance receipt linked to
Receipt date credit note and debit note.
Displays the Advance Receipt Date entered in the journal voucher.

Reason for Issuing Displays the Nature of Return selected in the Statutory Details screen
document of credit note and debit note.
When the transaction is recorded in journal voucher, the reason appears
as 07-Others.

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Place Of Supply Displays the State Name and state Code based on the Place of
Supply of the buyer in the Party Details screen of the voucher.
For transactions recorded with Exports Taxable, Exports
Exempt, and Exports LUT/Bond, the place of supply is captured as 97-
Other Territory.

Note/Refund Voucher Displays the total value in the voucher.

Value

Rate Displays the integrated tax rate with decimal places. If the stock item is
exempt, the tax rate appears as 0.00.

Taxable Value Displays the assessable value entered for each tax rate.

Cess Amount Displays the cess amount of the voucher.

Pre GST Displays Y if the Original Invoice Dt. entered is prior to 1-Jul-2017,
else N.

exp Displays the details of table 6 Exports Invoices - 6Aof GSTR-1 report.
Displays the values of export sales recorded in the reporting period with the
following details:
Nature of transaction as
● Exports Taxable
● Exports - LUT/Bond
● Exports Exempt

Export Type Displays the export type as:

● WPAY for sales recorded with Exports Taxableor Export Exempt as the
nature of transaction.
● WOPAY for sales recorded with Exports LUT/Bond as the nature of
transaction.

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Invoice Displays the sales voucher number entered in the transaction.
Number Special characters other than "-" and "/" in the voucher number are not exported.
If the length of voucher number is more than 16 characters, including the special
characters, the offline tool will display a validation error.

Invoice date Displays the sales voucher date of the transaction.

Invoice Value Displays the total value of the sales voucher based on tax rates.

Port Code Displays the Port Code of 6 characters entered in the Statutory Details screen of
the sales invoice. If the length of Port Code is more than 6 characters, the offline tool
will display validation error.

Shipping Bill Displays the Shipping bill no. entered in the Statutory Details screen of the
Number sales invoice.

Shipping Bill Displays the shipping bill Date entered in the Statutory Details screen of the sales
Date invoice.

Rate Displays the integrated tax rate with decimal places.

If the nature of transaction selected is Exports Exemptor Exports LUT/Bond, the
tax rate appears as 0.00.

Taxable Displays the assessable value entered for each tax rate.
Value

at Displays the details of table 7 Tax Liability (Advances received) - 11A(1),

11A(2) of GSTR-1report.
Displays the credit values of tax entered in journal voucher recorded with the
following details:
Nature of Adjustment - Increase of Tax Liability
Additional Details
● On Account of Advance Receipts
● Advance Receipts for Export/SEZ sales

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Place Of Supply Displays the State Name and state Code based on the Place of Supply of the
buyer in the Party Details screen of the voucher.

Rate Displays the integrated tax rate with decimal places.

If the stock item is nil rated or exempt, the tax rate appears as 0.00.

Gross Advance Displays the assessable value entered for each tax rate.
Received

Cess Amount Displays the cess amount of the voucher.

atadj Displays the details of table 8 Adjustment of Advances - 11B(1),

11B(2) of GSTR-1 report.
Displays the debit values of tax entered in journal voucher recorded with the
following details:
Nature of Adjustment - Decrease of Tax Liability
Additional Details
● Sales against Advance Receipts
● Sales against Advance Receipts for Export/SEZ sales

Place Of Supply Displays the State Name and state Code based on the Place of Supply of the
buyer in Party Detailsscreen of the voucher.
Displays the Place of supply entered in the Statutory Details screen of journal
voucher.

Rate Displays the integrated tax rate with decimal places.

If the stock item is nil rated or exempt, the tax rate appears as 0.00.

Gross Advance Displays the assessable value entered for each tax rate.
Adjusted

Cess Amount Displays the cess amount of the voucher.

exemp Displays the details of table 9 Nil Rated Invoices of GSTR-1 report.
Displays the net values of nil rated, exempt, and non-GST outward
supplies made to registered and unregistered dealers within and outside
the state.

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Description Displays the description as:
● Inter-State supplies to registered/unregistered persons
● Intra-State supplies to registered/unregistered persons

Nil Rated Supplies Displays the net sale value of nil rated supplies made to registered or
unregistered dealers within or outside the state.

Exempted (other than nil Displays the net sale value of exempt supplies made to registered or
rated/non GST supply) unregistered dealers within or outside the state.

Non-GST supplies Displays the net sale value of non-GST goods sold to registered or
unregistered dealers within or outside the state.

hsn Displays the details of table 10 HSN wise Summary - 12 of GSTR-1 report.
Displays the HSN of stock items/groups.

HSN Displays the HSN/SAC predefined for the ledger, stock group, or stock item
selected in the voucher.

Description Displays the Description of the HSN/SAC predefined for the ledger, stock group,
or stock item selected in the voucher. If HSN or HSN description is not defined for
stock items and ledgers, the name of the stock items and ledgers are displayed.

UQC Displays the Unit Quantity Code (UQC) predefined for the unit of measure linked
to the stock item selected in the voucher.
Displays the UQC as OTHERS-OTH for services.

Total Quantity Displays the total quantity based on HSN/SAC and UQC.

Total Value Displays the voucher value based on HSN/SAC and UQC.

Taxable Value Displays the assessable value based on HSN/SAC and UQC.

Integrated Tax Displays the integrated tax amount based on HSN/SAC and UQC.
Amount

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Central Tax Displays the central tax amount based on HSN/SAC and UQC.
Amount

State/UT Tax Displays the state tax amount based on HSN/SAC and UQC.
Amount

Cess Amount Displays the cess amount based on HSN/SAC and UQC.

docs Displays the details of the Document Summaryreport

Nature of Displays the transaction count of voucher type used for each nature of documents
Document recorded during the return period.

Sr. No. From Displays the first voucher number of the voucher type recorded for each nature of
document during the return period.

Sr. No. To Displays the last voucher number of the voucher type recorded for each nature of
document during the return period.

Total Number Displays the number of vouchers as per each nature of document recorded during
the return period.

Cancelled Displays the number of vouchers cancelled during the return period.

File GSTR-1 Returns using Tally.ERP9

Time to file GSTR-1? With Tally.ERP 9, file your GSTR-1 in four simple steps. Also, watch our video
on this page to learn more.
Steps for filing GSTR-1
1. Download and install the GST Offline Tool
2. Export GSTR-1 data from Tally.ERP 9
3. Generate the JSON file
4. File returns on the GST portal
Prerequisites for filing GSTR-1
● Internet connectivity: This is required for downloading the offline tool and filing returns.
● Microsoft Office: For exporting data to MS Excel, GSTN recommends MS Excel 2007 or later.
Note: You can use the GST Offline Tool either on the same computer where Tally.ERP 9 runs, or on
a different computer.

Download and Install the GST Offline Tool

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1. To download and install the GST Offline Tool
1. Go to the GST portal > Downloads.
2. Click Returns Offline Tool. A .zip file containing the GST Offline Tool will be downloaded.
This zip file also contains a detailed document on using the offline tool. Some important
information about the tool, and the system requirements for using the tool are also available
on the download page.

3. Extract the offline tool from the .zip file and install it.
If you are using an older version of the GST Offline Tool, you have to uninstall it and install the
latest version.
To uninstall:
♦ On your computer, go to Control Panel > Programs and Features.
♦ Right click GST Offline Tool, and click Uninstall and proceed.
♦ Similarly, uninstall the Node.js application.
♦ Delete the installation folder of the older version.
♦ Restart your computer. Now you can download and install the latest version of the GST Offline
Tool.

2. Export GSTR-1
You can export your GSTR-1 data either in MS Excel or CSV format. Before exporting GSTR-1,
resolve the exceptions in your transactions by going to the Summary of Exceptions (GSTR-1).
Note: The requirement to pay tax on advance receipts from customers has been withdrawn for
businesses with annual aggregate turnover up to Rs. 1.5 crores. To support this, calculation of tax
liability on advance receipts from customer has been disabled by default in Release 6.1.1.
The value from transactions recorded for tax liability on advance receipt from customers will not be
included in the GSTR-1 returns by default. Such transactions will be under Not relevant for
returns in the GSTR-1 report. The businesses with turnover above Rs. 1.5 crores can enable the
same by setting the option Enable tax liability on advance receipts to Yes in the Company GST
Details screen.
To Export GSTR-1
1. Go to Gateway of Tally > Display > Statutory Reports > GST > GSTR-1.

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2. Select the period for which returns need to be filed.
3. Press Ctrl+E.
Note: The Format is set to Excel (Spreadsheet) by default. To change the format, select CSV
(Comma delimited) on the Export Report screen.
4. Specify the Export Location and Output File Name.
5. Set Export HSN/SAC details even if UQC is not available? to Yes to export the transactions
having stock items not mapped to UQC. Do the required conversion in the MS Excel before
importing the file into the offline tool or directly enter it on the portal.
6. Set Export HSN/SAC details not included for other reasons? to Yes to export the
transactions which are not included in HSN/SAC Summary for other reasons. Enter this data on the
portal.
7. Set Export document summary? to Yes to generate the worksheet with relevant information of
document summary.
8. In Allow Export of select All Vouchers to generate the MS Excel file with all the transactions. If
you have already filed data for a few days in the period, on GSTN portal, select Only New
Vouchers to export the transactions that are not filed on GSTN portal. Ensure that you use a
different MS Excel file name, to avoid overwriting the existing files with the new transactions.
9. Press Enter to export.
If you have selected the CSV format, Tally.ERP 9 will create separate CSV files for each table in
GSTR-1. These files need to be imported into the offline tool.
Note: If the data exported to MS Excel has $ symbol in place of transaction details, or if the values
are not appearing, generate CSV file and import it into the offline tool. If you wish to continue with
MS Excel, you have to modify the Trust Center Settings in MS Excel, and add the location where
Tally.ERP 9 is installed on your computer. Click here for more information.
For more details on the information captured in each column of the e-return template, click here.
● The GST department has not issued GSTIN/UIN for e-commerce operators. Currently, when data
is exported from Tally.ERP 9 to MS Excel or CSV files, the GSTIN/UIN entered in the e-commerce
party ledger is captured as E-Commerce GSTIN in b2b, b2cl, and b2cs worksheets. After exporting
data to MS Excel or CSV files:
1. Delete the GSTIN/UIN captured in the column E-Commerce GSTIN.
2. Set the Type as OE in b2cs worksheet.
3. Generate the JSON file.
● The list of Unit Quantity Code provided by the department does not have the representative code
for brass, carats, litres, running foot, and so on. To handle this situation:
1. Based on your business requirement, map the unit to the related UQC and export it to MS Excel
or CSV files. For example, you can map litres to KLR-KILOLITRE.
2. In the hsn worksheet of the template or CSV file, convert the quantity as per the mapped UQC.
For example, if litre is mapped to KLR-KILOLITRE, multiply the quantity by 0.001 in
the hsn worksheet of the template or CSV file to convert litre to kilolitre.
3. Upload the modified MS Excel template or CSV file to the GST Offline tool.
4. Generate the JSON file.
Examples of mapping units to the related UQCs with the conversion factors are given below:

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Conversion of Quantity in
Unit of Measure Nearest UQC
Template

KLR-KILOLITRE Multiply by 0.001

Litres
MLT-MILILITRE Multiply by 1000

KGS-KILOGRAMS Multiply by 0.0002

Carat
GMS-GRAMMES Multiply by 0.2

SQF-SQUARE FEET Multiply by 100

Brass
CBM-CUBIC
Multiply by 2.835
METERS

Running foot MTR-METERS Multiply by 0.3048

Cubic inches MLT-MILILITRE Multiply by 16.3871

For cotton, multiply by

840
Hanks YDS-YARDS
For woolen, multiply by
560

MTR-METERS Multiply by 0.0254

Inches
CMS-
Multiply by 2.54
CENTIMETERS

TON-TONNES Multiply by 0.000453592

Pounds KGS-KILOGRAMS Multiply by 0.453592

GMS-GRAMMES Multiply by 453.592

TON-TONNES Multiply by 0.0000128

Lots KGS-KILOGRAMS Multiply by 0.0128

GMS-GRAMMES Multiply by 12.8

Milligrams GMS-GRAMMES Multiply by 0.001

Decameter SQY-SQUARE Multiply by 119.599

square YARDS

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SQF-SQUARE FEET Multiply by 1076.39

SQM-SQUARE
Multiply by 0.00064516
METERS

Square inches SQY-SQUARE

Multiply by 0.000771605
YARDS

SQF-SQUARE FEET Multiply by 0.00694444

Tola GMS-GRAMMES Multiply by 11.6638125

Note: The e-Return file has provision to capture the taxable value and tax rate but not the tax
amount. Hence, the tax amount is not exported to the e-Return file. Tax value is automatically
calculated after upload to the portal based on rate, taxable value and place of supply.

Generate JSON File

Now you need to import your data (either in MS Excel or CSV format) to the GST Offline Tool, and
generate the JSON file.

3. To import data and generate the JSON file

1. Open the GST Offline Tool.
2. Click NEW.

3. Provide the required details, and click PROCEED.

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4. Click IMPORT FILES.

5. Click IMPORT EXCEL, and select your file.

Note: If the tool shows a warning that some invoices contain invalid input, you can ignore it and
proceed. This happens when you do not have transactions in the given sections.
To export the return details in the CSV format, select the name of the table in Select
Section under Return Import – One section at a time, and click Import CSV. You have to
individually import files for each section.
6. Click YES on the warning message, and click VIEW SUMMARY.

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7. Click GENERATE FILE.

The offline tool generates a JSON file that has to be uploaded on the GST portal.

File Returns on the GST portal

4. To file GSTR-1 returns
1. Log in to the GST portal.

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2. Click Services > Returns > Returns Dashboard.

3. Select the Return Filing Period, and click Search.

4. Click PREPARE OFFLINE.

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5. Click Choose File to import the JSON file.

Once your JSON file is uploaded successfully, you will be notified by a message.

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6. Verify the uploaded details after the time specified in the GSTR screen.
You have to manually enter the details for Nil Rated Supplies and Documents Issued by referring
to the table-wise format of GSTR-1, because these details do not get directly uploaded to the portal.
7. Go to Services > Returns > Returns Dashboard, and click Prepare Online.

8. Go to the 8A, 8B, 8C, 8D - Nil Rated Supplies page, and enter the details.

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9. Go to the 13 - Documents Issued page, and enter the details.

10. Submit your returns and e-sign.

GSTR 1- Filing, Format and Due Dates

GSTR1 Introduction
As per the guidelines set by the GST Council, a registered taxable person is to follow a standard
return filing process, involving 3 forms – outward supplies details in GSTR 1 form by 10th of the
following month, corrections (if any) in GSTR 2 form by the 15th and finally the auto-populated
GSTR 3 form for final submission and payment, by the 20th.
With the government interested to bring in a smooth transition to GST, the return filing dates are
slightly different for the first two months of July and August. While one can file an interim return
in GSTR 3B for the months of July and August, one will need to ultimately file detailed returns via all
3 forms, as per the following revised return filing last dates -

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Revised Return Filing Due Dates

Month GSTR-1 GSTR-2 GSTR-3

1st-5th September, 6th-10th September, 11th -15th September,

July, 2017 2017 2017 2017

August, 16th-20th 21st-25th September, 26th-30th September,

2017 September, 2017 2017 2017

What is GSTR-1 Form?

Form GSTR-1 is a statement in which a regular dealer needs to capture all the outward supplies
made during the month. Broadly, the GSTR 1 format requires - all the outward supplies made to
registered businesses (B2B) to be captured at invoice level, and supplies made to unregistered
business or end consumers to be captured at rate-wise level. However, in certain exceptional
scenarios, even B2C transactions are required to be captured at invoice level.

How to file GSTR-1 Form?

Form GSTR-1 contains 13 tables in which the outward supplies details needs to be captured. Based
on the nature of business and the nature of supplies effected during the month, only the relevant
tables are applicable, not all. The GSTR-1 format is as follows:

 Table 1, 2 & 3: Details of GSTIN and aggregate turnover in preceding year.

 Table 4: Taxable outward supplies made to registered persons (including UIN-holders) other
than Zero rated supplies and Deemed Exports.
 Table 5: Taxable outward inter-State supplies to un-registered persons where the invoice
value is more than INR 2.5 Lakh.
 Table 6: Details of Zero rate supplies and Deemed Exports.
 Table 7: Details of Taxable supplies (Net of debit notes and credit notes) to unregistered
persons other than the supplies covered in Table 5.
 Table 8: Details of Nil rated, exempted and non GST outward supplies.
 Table 9: Details of debit notes, credit notes, refund vouchers issued during current period
and any amendments to taxable outward supply details furnished in the GSTR1 returns for
earlier tax periods in Table 4, 5 & 6.
 Table 10: Details of debit note and credit note issued to unregistered person.
 Table 11: Details of Advances Received/Advance adjusted in the current tax period or
Amendments of information furnished in earlier tax period.
 Table 12: HSN-wise summary of outward supplies.
 Table 13: Documents issued during the tax period.

Click here to view the tables and understand the GSTR 1 format.

When can one start filing GSTR 1 Form?

As a step towards early preparation and to ease the GSTR1 returns filing, the option for creation and

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saving of Form GSTR-1 are available on the GST portal from 24th July, 2017.

What is GSTR 1A Form?

The corrections (addition, modification and deletion) by the recipient in Form GSTR-2 will be made
available to supplier in Form GSTR-1A. The supplier has to accept or reject the adjustments made
by the recipient. The Form GSTR-1 will be amended according to the extent of correction accepted
by supplier.

Guide to File GSTR-1

With the filing of GSTR-3B right around the corner on 20th August, 2017, businesses are in full
swing gearing up to meet the deadline. Having said in our earlier blog ‘How to File Form GSTR-
3B’, Form GSTR-3B is an interim return which needs to be filed for first 6 months: July to December,
2017 (Revised ). However, this does not mean that the businesses are not required to file GSTR-1,
Form GSTR-2 and Form GSTR-3. It means, only the deadline to file GSTR-1, GSTR-2 and GSTR-3
are extended, and the businesses still need to file these return as per revised dates mentioned
below:

Due date to file GSTR-1, GSTR-2 and GSTR-3

Due Dates to file GST Return

Month GSTR-1 GSTR-2 GSTR-3

July, 2017 10th October, 2017 31st October, 2017 10th November, 2017

The above dates are only for July 2017 returns. The dates for August and subsequent month’s
returns will be notified at a later date.
As a step towards early preparation and to ease the GSTR-1 filing, the option for creation and saving
of Form GSTR-1 are available on the GST portal from 24th July, 2017. Subsequently, as recipient of
goods or services, the option to view the data uploaded by your suppliers is available in Form
GSTR-2A. In this blog, we will be discussing on How to File GSTR-1. From September onwards, the
due date to file GSTR-1 is 20th August, 2017.
Before we start discussing on how to file GSTR-1, let us understand what is Form GSTR-1 is all
about.

What is GSTR-1
Form GSTR-1 is a statement in which a regular dealer needs to capture all the outward supplies
made during the month. Broadly, all the outward supplies made to registered businesses (B2B) are
required to be captured at invoice level, and supplies made to unregistered business or end
consumers are required to be captured at rate-wise. However, in certain exceptional scenario, even
B2C transactions are required to be captured at invoice level.

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How to file GSTR-1?
GSTR-1 format contains 13 tables in which the outward supplies details needs to be captured. You
need not worry since all tables are not applicable for every business . Based on the nature of
business and the nature of supplies effected during the month, only the relevant components of
GSTR-1 are applicable, not all. Let us discuss on components of GSTR-1 format in detailed.
1. Details of GSTIN and aggregate turnover in preceding year.

In the above table 1, you need to capture the GSTIN allotted to you. Based on the GSTIN, table 2(a)
and 2(b) would be auto-populated with details furnished during registration or enrollment. In table
3(a), you need to capture the aggregate turnover of previous financial year, and in 3(b), aggregate
turnover of the last quarter (April to June, 2017) needs to be captured manually.
The quarterly turnover information is not to be captured in subsequent returns, and the aggregate
turnover of previous financial year would be required to be submitted by the taxpayers only in the
first year. From subsequent years, it will be auto-populated.
2. Taxable outward supplies made to registered persons (including UIN-holders) other than Zero Rated supplies and
Deemed Exports.

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In the above table, all B2B supplies (outward supplies made to a registered person) both inter-State
and intra-State outward supplies should be captured at invoice level rate-wise details. This table has
3 sections: 4A, all the outward supplies except those attracting reverse charge and supplies made
through e-commerce operator; supplies attracting reverse charge should be captured rate-wise in
4B, and those effected through e-commerce operator attracting collection of tax at source should be
captured operator wise and rate-wise in 4C respectively.
3. Taxable outward inter-state supplies to un-registered persons where the invoice value is more than Rs 2.5 Lakh.

In above table, all inter-State B2C supplies (supplies made to unregistered dealer or end consumer),
where invoice value is more than Rs. 2,50,000, you need to upload the invoice-wise and rate-wise
details. Similar to table 4, you need to capture the supplies effected through e-commerce operator
separately in 5B and all other interstate supplies having invoice value more than Rs. 2,50,000 to be
captured in 5A. This type of supplies are referred as B2C Large.

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4. Details of Zero Rate supplies and Deemed Exports

In the above table 6, the information related to exports out of India to be captured in 6A, supplies to
SEZ unit or SEZ developer in 6 B, and deemed exports in 6C. The details of these supplies need to
be captured at invoice-wise and rate-wise. In declaring these details, the following points needs to
be taken care of:

1. Shipping bill and its date. The details of Shipping Bill shall be furnished in 13 digits
capturing port code (six digits) followed by unique reference number of shipping bill and its
date. If the shipping bill details are not available at the time of filing GSTR-1, the same can
be left blank and can be updated as amendment in Table 9 in the next tax period in which
the details are available but before claiming any refund/rebate related to the said invoice.
2. Any supply made by SEZ to Domestic Tariff Area (DTA), without the cover of a Bill of Entry is
required to be reported by SEZ unit in GSTR-1. The supplies made by SEZ on cover of a Bill
of Entry shall be reported by DTA unit in its GSTR-2 as Imports in GSTR- 2.
3. In case of export transactions, GSTIN of recipient will not be applicable and it needs to be
left blank.
4. Export transactions effected without payment of IGST (under Bond/Letter of Undertaking
(LUT)) needs to be reported as “0” under tax amount heading in Table 6A and 6B.

5. Details of taxable supplies (Net of debit notes and credit notes) to unregistered persons other than the supplies
covered in table 5

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In the earlier table, that is, no. 5, the taxable person had declared only the interstate outward
supplies made to unregistered person (B2C Large) having invoice value more than Rs. 2.5 Lakh. In
the this table, that is, Table 7, you need to capture all other supplies made to unregistered person,
that is, all intra-state supplies in 7A and inter-state supplies having invoice value up to Rs. 2.5 Lakh
made to unregistered dealer in 7B. In Table 7A(1), you need to capture consolidated rate-wise
details of all intrastate outward supplies made to unregistered persons, including the supplies made
through e-commerce operator. In 7A (2), you need to show separately the details of supplies made
through e-commerce operator attracting collection of tax-at-source out of gross supplies reported in
7A (1).
Similarly, the details of inter-state outward supplies having invoice value up to Rs 2.5 Lakh need to
be captured state-wise and rate-wise in 7B (1). In 7B (2), you need to separately show the details of
supplies made through e-commerce operator attracting collection of tax-at-source out of gross
supplies reported in 7B (1).
Please note, all the above values should be net of debit note and credit note. If there are any debit
note or credit note pertaining to above mentioned supplies, ensure to adjust such values and declare
only the net taxable value and corresponding tax.
6. Details of nil rated, exempted and non GST outward supplies

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In the above Table 8, you need to capture the nil rated, exempted and Non GST outward supplies
made during the period. These details needs to be categorized as intra-State supplies to registered
person, and inter-State supplies to unregistered person in 8A to 8D as shown in the above table.
7. Details of debit notes, credit notes, refund vouchers issued during current period and any amendment to GSTR-1
filed for earlier tax periods in Table 4, 5 and 6.

In the above table, you need to capture the details of debit note, credit note and refund voucher
(return of advance received) issued against the supplies already reported in:

• B2B supplies reported in Table 4,

• B2C Large supplies reported in Table 5,

• Supplies involving exports/SEZ unit or SEZ developer/deemed exports reported in Table 6.

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These details needs to be capture rate-wise along with the original invoice number against the debit
note or credit note issued. In the first three columns, you need to mention the details of original
invoice, followed by the rate-wise details of credit note/debit note/refund voucher issued during the
return period.
In table 9A, if shipping bill number and date was not declared in your earlier returns due to non-
availability, you can furnish such details pertaining to export transactions effected during earlier
return as amendments. If the export transactions are related to current month, the shipping details
should be entered in Table 6.
In Table 9B, rate-wise details of credit note/debit note/refund voucher issued during the return period
need to be captured and in table 9C, the details of amendments made through credit note/debit
note/refund voucher against the invoice/advance receipt pertaining to pervious return period. Also,
any debit/credit note pertaining to invoices issued before the appointed day must also to be reported
in this table.
8. Details of debit note and credit note issued to unregistered person

In the above table, you need to capture the consolidated rate-wise details of debit note/credit note
issued against the intra-State supplies made to unregistered person and inter-State supplies having
invoice value less than Rs. 2.5 Lakhs made to unregistered person in previous return period. This is
an amendment to the details declared in Table 7 of earlier return. In Table 10A and 10B, you need to
capture the rate-wise details of intra-State supplies and inter-State supplies respectively. Out of the
value captured in table 10A and 10B, you need to separately capture the details of supplies made
through e-commerce operator in 10A (1) for intra-State and 10B (1) for inter-State supplies.
9. Details of Advances Received/Advance adjusted in the current tax period or Amendment to GSTR-1 furnished in
earlier tax period

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In the above table 11, you need to provide consolidated state-wise and rate-wise details related to
advances received in the current period, and also the details of advances received in earlier period
but adjusted in the current period. In Table 11A, capture the details of advance received for which
the invoice has not been be issued. These details are need to be categorised into intra-State
supplies in table 11A (1) and inter-State supplies in table 11A (2).
You also need to include information in table 11B related to adjustment of tax paid on advance
received and reported in earlier tax periods against invoices issued in the current tax period. Similar
to 11A, these details are also required to be categorised into intra-State supplies in Table 11B (1)
and inter-State supplies in table 11B (2).
If there are any changes pertaining to details declared in table 11A to 11B in earlier return, it can be
amended by furnishing the changes in Part II of Table 11.
Please note, the details relating to advances received to be submitted only if the invoice has not
been issued in the same tax period in which the advance was received. If the advance and invoice is
issued in the same month, the details need not be captured in table 11.
10. HSN-wise summary of outward supplies

In the above table, that is, Table 12, summary of supplies effected against a particular HSN code

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must be reported. It will be optional for taxpayers having annual turnover up to Rs. 1.50 Crore.
However, description of goods is mandatory.
It is mandatory to report HSN code at two-digit level for taxpayers having annual turnover in the
preceding year above Rs. 1.5 Cr. but up to Rs. 5 Cr., and at four-digit level for taxpayers having
annual turnover above Rs. 5 Cr.
The fourth column UQC refers to unit quantity code and only the prescribed unit of measure (UOM)
will be accepted by the portal. Therefore, irrespective of the UOM maintained by the tax payer, the
quantity details need to be furnished using the prescribed UQC listed below:

List of UQC

BAG-BAGS CTN-CARTONS MTS-METRIC TON TGM-TEN GROSS

BAL-BALE DOZ-DOZENS NOS-NUMBERS THD-THOUSANDS

BDL-BUNDLES DRM-DRUMS PAC-PACKS TON-TONNES

BKL-BUCKLES GGK-GREAT GROSS PCS-PIECES TUB-TUBES

BOU-BILLION OF UNITS GMS-GRAMMES PRS-PAIRS UGS-US GALLONS

BOX-BOX GRS-GROSS QTL-QUINTAL UNT-UNITS

BTL-BOTTLES GYD-GROSS YARDS ROL-ROLLS YDS-YARDS

BUN-BUNCHES KGS-KILOGRAMS SET-SETS OTH-OTHERS

CAN-CANS KLR-KILOLITRE SQF-SQUARE FEET

CBM-CUBIC METERS KME-KILOMETRE SQM-SQUARE METERS

CCM-CUBIC CENTIMETERS MLT-MILILITRE SQY-SQUARE YARDS

CMS-CENTIMETERS MTR-METERS TBS-TABLETS

11. Documents issued during the tax period

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In the above table, you need to capture the details of documents issued during the return, along with
the starting and ending number of the document, cancelled document and net issued.

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