Efficient Input Tax Credit Adjustment in Tally Prime

Transferring Input tax credit to GST

Transfer of closing balance of input tax credit to GST

01-07-2017 We transferred the input VAT credit of Rs. 20,000 to state tax ledger.

01-07-2017 We transferred the CENVAT credit of Rs. 5,000 to central tax ledger.

Input Tax Credit Set Off

15-07-23 Adjust the following input credit against available tax liability:

Input Tax Credit	Liability Amount
Central Tax – Rs. 1,41,300	Central Tax – Rs. 1,62,090
State Tax – Rs. 1,41,300	State Tax – Rs. 1,62,090
Integrated Tax – Rs. 73,800	Integrated Tax – Rs. 39,600

Ledger Creation

Access Ledger Creation:
- Go to Gateway of Tally.
- Select "Accounts Masters" from the main menu.
- Choose "Ledgers" to access the ledger creation screen.
Create Input VAT Ledger:
- Select "Create" under the single ledger option.
- Enter the name as "Input VAT".
- Under "Under", choose "Duties & Taxes" from the list of groups.
- Press Enter to save.
Create Cenvat Ledger:
- Select "Create" under the single ledger option.
- Enter the name as "Cenvat".
- Under "Under", choose "Duties & Taxes" from the list of groups.
- Press Enter to save.

01-07-2017 We transferred the input VAT credit of Rs. 20,000 to the state tax ledger.

Access Journal Voucher:
- Go to the Gateway of Tally.
- Select "Accounting Vouchers" from the main menu.
Select Journal Voucher:
- Choose "F7: Journal" from the voucher types.
Enter Date:
- Input the voucher date as "01-07-2017".
Enter Narration:
- Add a narration explaining the transaction, for example, "Transfer input VAT credit to state tax ledger."
Stat Adjustment:

Press Alt + J to open the Stat Adjustment screen.

Enter GST Details:

In the Stat Adjustment screen, set the "Type of duty/tax" as GST.
Choose "Nature of Adjustment" as Opening Balance.

Debit SGST Ledger:

Select the SGST ledger account and enter the amount of Rs. 20,000 in the Debit column.

Credit Input VAT Ledger:

Select the Input VAT ledger account and enter the amount of Rs. 20,000 in the Credit column.

Save the Voucher:

Press Ctrl+A to save the voucher.

01-07-2017 We transferred the CENVAT credit of Rs. 5,000 to the central tax ledger.

Journal Voucher Entry in Tally

Access Journal Voucher:
- Go to the Gateway of Tally.
- Select "Accounting Vouchers" from the main menu.
Select Journal Voucher:
- Choose "F7: Journal" from the voucher types.
Enter Date:
- Input the voucher date as "01-07-2017".
Enter Narration:
- Add a narration explaining the transaction, for example, "Transfer CENVAT credit to central tax ledger."
Stat Adjustment:
- Press Alt + J to open the Stat Adjustment screen.
- Enter GST Details:
  - In the Stat Adjustment screen, set the "Type of duty/tax" as GST.
  - Choose "Nature of Adjustment" as Opening Balance.
- Debit CGST Ledger:
  - Select the CGST ledger account and enter the amount of Rs. 5,000 in the Debit column.
- Credit CENVAT Ledger:
  - Select the CENVAT ledger account and enter the amount of Rs. 5,000 in the Credit column.
Save the Voucher:
- Verify the details entered.
- Press Ctrl + A to save the voucher.

View Reports

Gateway of Taly -> Display More Reports -> GST Reports

Journal Voucher Entry in Tally

Access Journal Voucher:
- Go to the Gateway of Tally.
- Select "Accounting Vouchers" from the main menu.
Select Journal Voucher:
- Choose "F7: Journal" from the voucher types.
Enter Date:
- Input the voucher date.
Enter Narration:
- Add a narration explaining the transaction, for example, "Decrease in tax liability with CGST adjustment."
Stat Adjustment:
- Press Alt + J to open the Stat Adjustment screen.
- Enter GST Details:
  - Set the "Type of duty/tax" as GST.
  - Choose "Nature of Adjustment" as Decrease In Tax Liability.
  - Additionally, choose "Others" as the "Additional Nature of Adjustment."
- Debit CGST Ledger:
  - Select the CGST ledger account and enter the amount of Rs. 141,300 in the Debit column.
- Credit CGST Ledger:
  - Select the CGST ledger account again and enter the same amount of Rs. 141,300 in the Credit column.
Save the Voucher:
- Verify the details entered.
- Press Ctrl + A to save the voucher.

Journal Voucher Entry in Tally

Access Journal Voucher:
- Go to the Gateway of Tally.
- Select "Accounting Vouchers" from the main menu.
Select Journal Voucher:
- Choose "F7: Journal" from the voucher types.
Enter Date:
- Input the voucher date.
Enter Narration:
- Add a narration explaining the transaction, for example, "Decrease in tax liability with CGST adjustment."
Stat Adjustment:
- Press Alt + J to open the Stat Adjustment screen.
- Enter GST Details:
  - Set the "Type of duty/tax" as GST.
  - Choose "Nature of Adjustment" as Decrease In Tax Liability.
  - Additionally, choose "Others" as the "Additional Nature of Adjustment."
- Debit CGST Ledger:
  - Select the CGST ledger account and enter the amount of Rs. 39,600 in the Debit column.
- Credit CGST Ledger:
  - Select the CGST ledger account again and enter the same amount of Rs. 39,600 in the Credit column.
Save the Voucher:
- Verify the details entered.
- Press Ctrl + A to save the voucher.

View Reports

Gateway of Taly -> Display More Reports -> GST Reports