VAT Adjustment Class Journal [ VAT ]in Tally.

ERP 9
To create a VAT Adjustment Class,

Go to Gateway of Tally > Accounts Info. > Voucher Types > Alter >
Journal

In the Voucher Type Alteration screen, enter the Name of Class,

for e.g., VAT Adjustment Class.

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Set Use Class for VAT Adjustments to Yes.

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Press Enter to go back to Voucher Type Alteration screen.

Accept the journal Voucher Type Alteration screen.

No te : Th e v ou ch e r cl as s i s c r e at ed f or en a bl i n g th e l i st of VAT
Adj u s tm en t s ( fl ag s) i n j ou rn al . Th e s a me i s u s ed f o r r e c o rdi n g
th e a dj u s tm en t s i n t h e f o r m.

Th e VA T A dj u s tm en t t o be u s e d f o r r e c o rdi n g th e adj u st men t

en t ri e s wi l l be di s p l ayed f or s el e cti on bas e d on th e St a te an d
th e T yp e of De a l er p r e- d efi n ed i n th e F 3 : S t at ut or y &
 T ax a ti o n F e at u re s . Th e VA T Adj u stm en ts p e rtai n i n g to
K arn ata ka wi l l be di spl ay ed on s el e c ti n g th e V ou ch e r cl as s
c r eat ed f o r th e j ou r n al v ou ch e r.

VAT Adjustment against Tax Payable [ VAT ]in

Tally.ERP 9
At the end of every tax period it is advisable to set off the output vat amount of output vat ledgers with
Input VAT amount of input VAT ledgers created.

Where the net output is in excess, the balance amount of VAT due is transferred to VAT
Payable ledger. For any tax period, if the input tax is in excess of output VAT, then input VAT has to be
adjusted to the extent of output VAT liability and the balance of Input Tax Credit can remain in the
respective ledgers.

To create a journal voucher for adjusting the output VAT against input VAT,

Go to Gateway of Tally > Accounting Vouchers > F7: Journal > Select Not Applicable from
the Voucher Class List.

1. Select the required Output VAT, Purchase Tax and CST ledgers to be debited from
the List of Ledger Accounts and enter the corresponding ledger balance amount for the
given period in the Debit field. These ledgers are to be debited for adjusting the total output
vat (for each rate) against input vat ledgers.

Note: O nl y i n Karnataka VAT e nabl e d Company, the output VAT, Purchase tax and CST
l e dge rs are to be se l e cte d to se t - off the due s agai nst i nput tax cre di t as the VAT re turn
acts as VAT and CST re turn. For othe r state s, onl y the output VAT and purchase tax
l e dge rs nee d to be se le cted.

2. Credit the Input VAT ledgers and enter the amount that has to be set-off against the output
vat, purchase tax and CST ledgers that are debited.

3. In case the aggregate of input vat ledgers is less than the debit values of output VAT values
debited, transfer the balance amount to VAT Payable ledger by selecting it in the credit field. VAT
Payable ledger can be grouped under Current Liabilities or Duties & Taxes with Type of
Duty/Tax as Others orCurrent Liabilities.

4. In case where the input VAT value is more than the output VAT, use the excess amount to the
extent required for set-off. Here the additional ledger like VAT payable need not be used.
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5. Accept the voucher and then make a payment entry for the payable amount if any.

Entry for Payment of VAT Liability [ VAT ]in Tally.ERP

9
VAT Payment

To create a VAT Payment voucher,

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

1. In the Payment Voucher press Stat Payment button (Alt+S). In

the Statutory Payment screen enter the details given below:

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2. In Statutory Payment screen

Type of Duty/Tax: Select VAT if the payment is being made towards

VAT dues, else select CST.

Auto Fill Statutory Payment: Set it to Yes to automate the display

of VAT payable amount.

Adjust Input VAT for Payment: This field gets displayed only when -
Auto Fill Statutory Payment is enabled. On setting this field to Yes, the
VAT payable amount gets calculated by offsetting output VAT against
the available tax credit.

Period From: Enter the return period in From and To fields.

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3. Press Enter to save the Statutory Payments screen. On saving the

Statutory Payments details, the VAT Details will be auto filled in the payment
Voucher.

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4. In Account field select the Bank Ledger - Dena Bank from the List of
Ledger Accounts

5. Enable the option Provide Details to Yes to enter the payment

Details

6. In Payment Details screen

 Period From and To: The period details will be displayed
automatically based on the details entered in Statutory Details scren.

Type of Payment: Select Not Applicable as the payment is made

towards the Original returns (monthly VAT liability)

Deposit Date: Enter the Date of Deposit of VAT to the department.

DD/Cheque No.: Enter the DD or Cheque Number through which

the payment is made.

Name of Issuing Bank: Enter the name of the bank on which the DD
or cheque is issued.

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7. Enter the details in the field Narration, if required.

8. Press Y or Enter to accept and save.

Recording Payment Voucher in Different Scenarios

Paying only the output VAT amount using Statutory Payment button

In the Payment Voucher press S: Stat Payment button (Alt + S) to display

the Statutory Payment Details screen. Set Auto Fill Statutory
Payment to Yes to calculate the VAT payable amount automatically and
set Adjust Input VAT for Payment to No.

Automatically offsetting the Output VAT against available Tax credits

In the Payment Voucher press S: Stat Payment button (Alt + S) to display

the Statutory Payment Details screen. Set Auto Fill Statutory
Payment to Yes andAdjust Input VAT for Payment to Yes.

Entering VAT payable amount manually

In the Payment Voucher press S: Stat Payment button (Alt + S) to display
the Statutory Payment Details screen. Set Auto Fill Statutory
Payment to No.

Paying Other Current Liabilities by recording separate entry for each

Payment Type

Payment of only the current liabilities like interest, penalty, late fees etc. as per
state-specific provisions can be recorded in payment voucher. In the Payment
Voucher press S: Stat Payment button (Alt + S) to display the Statutory
Payment Details screen. Set Auto Fill Statutory Payment to No. On
selecting theCurrent Liability ledger the Payment Type sub-screen will be
displayed. Select the required Type of Payment and accept the payment entry.

Alert Message

In the absence of output VAT ledgers or taxable sales entries, if the Stat
Payment button is selected in payment voucher for automating the payment
value, the Alert Message will be displayed as shown:

[Img-82]

On display of this Alert message follow any of the following procedures:

1. Check From and To dates to ensure that balances are available in

both Input and Output Vat ledgers for the specified period

2. Ensure that the Input Vat and Output Vat ledgers are selected with the
respective VAT Sub Type

3. Mark the Auto Fill option as No and continue as a Manual Payment.

VAT Reports [ VAT ]in Tally.ERP 9
VAT Reports

To view the Statutory Reports menu of Karnataka State,

Go to Gateway of Tally > Display > Statutory Reports > VAT

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The VAT Reports menu consists of

VAT Computation

VAT Forms

E-VAT Annexures

VAT Commodity

VAT Register

Value Added Tax Commodity Report

In the VAT Reports menu, click on VAT Commodity. The Commodity

Report menu displays as shown:
[Img-84]

The Value Added Tax Commodity Report menu consists of:

Purchase

Sales

Value Added Tax Registers

To view the Value Added Tax Register menu,

In the VAT Reports menu click VAT Register

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The Value Added Tax Registers menu consists of:

Vat Purchase Registers

Vat Sales Registers

VAT Computation [ VAT ]in Tally.ERP 9

The VAT Computation reports provide the Assessable Value and the Tax
Amount of the purchase and sales transactions entered using different VAT/
Tax classifications. The adjustment entries recorded using the VAT
Adjustments are also captured in the VAT Computation.

To view the VAT Computation report,

Go to Gateway of Tally > Display > Statutory Reports > VAT > VAT
Computation

The VAT Computation report is displayed as shown below:

[Img-86]
[Img-87]

A detailed explanation of the fields in the VAT Computation report is given

below:

Assessable Value

The Assessable Value is the sum of the total value of goods at which they are
purchased and sold. This assessable value forms the value on which VAT is
calculated.

Tax Amount

The total Tax Amount calculated on Assessable value using the respective Tax
percentage is the Tax Amount.
No te : Yo u can d ri l l do wn th e V AT Co m pu t at io n s c r e en t o vi ew
th e V AT C l a s s if ic a t io n v o uc he r s .
F1: Detailed

To view the VAT Computation Report in detail, click the button F1: Detailed or
press Alt + F1.

You can observe that the VAT Computation screen thus displayed, has only local
taxable transactions captured in the report.

To show all VAT classifications and CST details. The report can be configured to
display the same by clicking F12: Configure
Displaying All VAT Classifications

To display all VAT Classifications, set the option Show All VAT
Classifications to Yes in F12: Configure

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On setting this option to Yes, you can see that the VAT Computation report
displays details of all VAT Classifications, including exempt transactions.

The VAT Computation screen displays as shown:

[Img-89]
[Img-90]

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Displaying CST Details

To display CST Details in VAT Computation report, set the option - Show CST
Details to Yes in F12: Configuration.

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The VAT Computation report with CST Details is as shown below:

[Img-93]
[Img-94]

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VAT Classification Vouchers Report

The details of transactions recorded using a particular VAT/Tax class will be
displayed here. Select a VAT/tax classification in VAT Computation screen and
press Enter key to view the VAT Classification Vouchers report.

VAT Classifications Vouchers Report without MRP Column

While invoicing if the MRP/Marginal field is not enabled, the VAT

Classification Vouchers report displays without the MRP column as shown:

[Img-96]

VAT Classifications Vouchers Report with MRP Column

In case where the MRP/Marginal field is enabled while invoicing and VAT
Classification Vouchers report is generated, the MRP/Marginal value appears
in MRP column.
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VAT Return Form

The print preview of the Form VAT 100 of Karnataka displays as shown:
[Img-98]

Form VAT 100 - Page 1

[Img-99]

Form VAT 100 - Page 2

[Img-100]

Form VAT 100 - Page 3

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Form VAT 100 - Page 4

No te : Th e d etai l ed e xpl an ati on on th e val u e s capt u r e d i n ea ch

fi el d o f r etu rn f o r m i s a vai l abl e i n th e stat e - s p eci fi c sta t u to r y
 man u al u pl oad ed on ou r w eb si te .

VAT Computation Analysis [ VAT ]in Tally.ERP 9

The VAT Analysis section is introduced in the VAT Computation report to
provide information on VAT Payable, amount paid and refund amount for the
current period along with the details of input tax credit and VAT liability carried
forward to the next return period.
No te : To i ll u str at e th e VA T An al ysi s , t h e en tri es of pu rch as e s
an d s al e s a r e r ec o r ded i n th e m on th o f D e c emb e r i n a n e wl y
c r eat ed c o mpan y . H en c e th e In pu t VAT o r ou tpu t VA T of
pr e vi ou s m on th s a r e n ot c ar ri ed f o rw a rd f r om p r e vi ou s m on t h s.
Assume that there is are taxable purchase and sales entries as illustrated below:

Purchase Entry

Record a purchase entry by selecting purchase & input VAT ledgers with VAT/Tax
class - Purchases @ 5% and Input VAT @ 5% respectively. The purchase
entry appears as shown:

[Img-102]

Sales Entry

Record a sales entry by selecting sales & output VAT ledgers with VAT/Tax class
- Sales @ 5% and Output VAT @ 5% respectively. The sales entry appears as
shown:

[Img-103]

VAT Computation

In the VAT Computation screen click on F12: Configure and set Show VAT
Analysis to Yes.

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Press Alt+F1 to view the report in Detailed mode. The VAT Computation with
VAT Analysis displays as shown:
[Img-105]

VAT Analysis - Payable and Paid Amount on Full Payment of VAT

Dues

For the above purchase and sales entries, record a payment entry for full
payment of VAT dues using the Auto-fill option. In the single entry mode of
Payment voucher, select the bank ledger in Accounts field and press S: Stat
Payment button (Alt+S). Set the options as shown in Statutory
Details screen.

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The Payment entry displays as shown:

[Img-107]

Set Provide Details field to Yes and enter the VAT Payment Details.

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After accepting VAT Payment Details, the Bank Allocations screen appears.
The Bank Allocations for field displays the bank ledger selected in Accounts field
of payment voucher. Under Payment Favouring for, enter the name in whose
favour the payment is being made. Select the required Transactions Type. The
payable amount is captured in Amount column. The cheque number entered
in VAT Payment Details screen needs to be entered in Instrument No. field,
the Instrument Date is captured from Voucher Date. If Cheque is selected
as the Transaction Type the Cross Instrument Using field will be displayed
as A/c Payee. On selecting any other Transaction Type, the Cross
Instrument using field will not be displayed.
[Img-109]

Accept the payment entry.

Go to VAT Computation and view the VAT Analysis. Separate sections are
provided for VAT Liability and VAT Payments. Under VAT Liability, the VAT
Payableamount and the Current Period VAT Payable amount will be
displayed. Under VAT Payment, the amount Paid through
Challan/cheque will be shown. The VAT Payable will not show any amount if
the payment of VAT dues is done fully.

The Payable and paid amount displays as shown:

[Img-110]

Go to the payment entry and mark it optional as the same purchase and sales
entries will be used in the scenarios explained in the partial and excess payment
examples.

VAT Analysis - Payable and Paid Amount on Excess Payment of

VAT

Assume that an advance payment was done before computation of actual dues
and the paid value was in excess of actual payable at the end of the tax period.

In the single entry mode of Payment voucher, select the bank ledger
in Accounts field and press S: Stat Payment button (Alt+S). In the Statutory
Payment sub-screen set the options - Type of Duty/Tax as VAT and Auto Fill
Statutory Payment to No. In the Payment entry select the VAT
Payable ledger and enter the amount in excess of VAT dues.
[Img-111]

Set Provide Details field to Yes and enter the VAT Payment Details. Accept
the payment entry.

Go to VAT Computation and view the VAT Analysis. Under VAT Liability,
the VAT Payable amount and the Current Period VAT Payable amount will be
displayed. Under VAT Payment, the amount Paid through Challan/cheque
will be shown. The excess amount paid will be shown as VAT
Refundable/Carried Forward.

The payable and paid amount for the current period displays as shown:
[Img-112]

Change the period of VAT Computation to the subsequent tax period. The
excess amount paid for the current period will be carried forward to the
subsequent period as VAT Refundable/Carried Forward.

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Go to the payment entry and mark it optional as the same purchase and sales
entries will be used in the next example.

VAT Analysis - Payment of Interest Amount with VAT

Assume that the payment is to be made towards interest. In the journal

voucher, select the voucher class created for recording VAT
adjustment entries. SelectInterest Payable in the Used
for field. Debit the Interest expenses ledger (grouped under Indirect
Expenses) and credit the interest payable ledger (grouped under Current
Liability).
In the single entry mode of Payment voucher, select the bank ledger
in Accounts field and press S: Stat Payment button (Alt+S). Set the options -
Type of Duty/Tax as VAT and Auto Fill Statutory Payment to Yes/No as
per requirement. On setting Auto Fill Statutory payment and Adjust Input
VAT for Paymentto Yes and entering the period, the value will be automated.
If set to No, the payable amount needs to be entered manually.

In Payment entry, select the interest payable ledger after VAT ledgers and set
the Type of Payment as Interest.

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Enter the ledger balance in the amount field.

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Accept the payment entry.

Go to VAT Computation and view the VAT Analysis. Under VAT Liability,
the VAT Payable amount and the Current Period VAT Payable amount will be
displayed. Under VAT Payment, the amount Paid through
Challan/cheque will be shown with the breakup of VAT and interest amount
paid.
No te : Th e b r ea k - u p of V AT an d i n te r e st am ou n t i s di spl ay ed
 on l y i n c a s e wh e r e I nt e re s t i s s el e ct ed a s th e Ty p e of
Pa y me nt i n th e P aym en t V ou ch e r . T h e P a ym e nt Ty pe su b -
s cr e en i s p r o vi de d i n pay m en t v ou ch e r r e c o rd ed u si n g Stat
Pa ym en t b u tt on as per th e Sta te sp e ci fi c st atu to r y
r equ i r e m en t s.
The payable and paid amount for the current period displays as shown:

[Img-116]