Tally Accounting

Goods and Services Tax (GST) Set up for Regular Dealers in Tally

Posted by Asok K Nadhani on

Goods and Services Tax (GST) Set up for Regular Dealers in Tally

GST Activation for Regular Dealer in Tally

We all have learned about the operational details of Accounting with Tally, for organizations to which GST is not applicable.

Now, we discuss about the exclusive additional points regrading activation, set up, Accounts & Inventory masters, Transaction entries, Reports relating to maintenance of GST, uploading to GST portal, without repeating the common points already discussed.

GST Set Up for Company in Tally

Now, we will discuss GST Set Up for the Company in Tally.ERP9, enrolled as Regular Dealer, whom GSTIN has been allotted.    

First,activate GST for organisation registered under GST rules, in Tally.ERP 9 system. You should set up GST for only for such Company, in which GST is applicable. For example, if you have created 3 Companies in Tally. First Business Company for your business in which GST is applicable. Second Business Company in which GST is not applicable, and a third Personal Accounts Company in which GST is not applicable, then you do not need to set up GST only for First Company in which GST is  applicable, and need not set up GST for 2nd & third Company for those Company in which GST is not applicable.

At Gateway, Press F11:Features  to get Company Features Menu. Select Statutory & Taxation (or GoT>F11:Features>F3) to get Statutory & Taxation screen .

Company Features Menu in Tally

At Statutory & Taxation screen, set as follows:

GST details entry for Regular Dealer inTally

GST Details entry for Regular Dealer in Tally

GST set up for Registered Dealer in Tally

At GST Details entry screen, enter as follows:

  • State : At State, the State as selected at Company creation screen appears as default, otherwise select the State / UT, from the List of States , in which the company is registered with GST
  • Registration Type : At Registration Type Select the Registration Type from list (Regular / Composition),as applicable
  • Assessee of Other Territory : Set Yes if your business unit in located in the Exclusive Economic Zone (other territory), else Set No.
  • GSTIN/UIN : At GSTIN/UIN, correctly enter the complete 15 digit State /UT GSTIN allotted.

If you are working for Test Company for learning, or the Registration Number is not yet allotted, but you want to go ahead for working, you may enter any imaginary Registration in valid structure, as explained next, and proceed further.

  • Date of Applicability : At Applicable from, normally enter the date of applicability of GST in India (i.e 1 July 2017). For new applicants, enter the Date from which GST became applicable in your organisation. GST will not be applicable for vouchers earlier to this date and such transactions will not be included in any GST report.
  • Periodicity of GSTR-1 : Select the periodicity of GSTR-1, Monthly / Quarterly, as applicable (in case of Regular Registration), as applicable to you. Business with Turnover upto 1.5 crore may submit Quarterly GSTR-1 Return.
  • E-way Bill Applicability : At E-way Bill Applicable? set Yes if e-way Bill is applicable, else set No. If set Yes, then further set up the following options.
    • E-way Bill Applicability Date : AtE-way Bill Applicable from, enter the date of e-way Bill applicability.
    • E-way Bill Threshold Amount : At E-way Bill Threshold enter the minimum value above which e-way Bill is mandatory (e.g Rs 50000).
    • Threshold Amount computation : At Threshold limit includes,select the method in which Threshold value is computed for e-way Bill, from the list
    • E-way Bill Intra State Applicability :  At E-way Bill Applicable for Intra state, set Yes if e-way Bill is mandatory  for Intra State Transaction also beyond the threshold limit, else set No.
  • Tax Liability for Advance Receipt : At Tax Liability for Advance Receipt, Set No, if no Tax liability is applicable for Advance receipts against supply, set Yes, if Tax Liability is applicable for Advance receipts.
  • Tax Liability on Reverse Charge : At Enable Tax Liability on Reverse Charge, set Yes if Reverse Charge is applicable for Purchase from Unregistered Dealer, set No, if Reverse Charge is not applicable for Purchase from Unregistered Dealer.
  • GST Rate Details Activation : At Set / Alter GST rate Details set Yes if only SAME GST Rate is applicable for all Items.

We recommend to set No so that you may set different GST Rate for Items / Item Groups at lower level, as discussed later). Otherwise, you may set Yes to get GST Details entry screen to set Tax Details, as explained next. Even if currently only single Rate GST is applicable for all products, at Set / Alter GST rate Details it is recommend to set No. If you set No, it would be easier to set GST Rate for any new Item with different GST Rate (discussed later)

  • GST Classification Activation : At Enable GST Classification set Yes to enter GST Classification Masters, and set GST rates for each Classification, instead of Stock Item. Otherwise, Set No to set GST Rates at Stock Item as explained later. We recommend to set No to keep things simpler. We will explain about GST Classification later on.
  • LUT / Bond Details: LUT / Bond is applicable for certain Importers / Exporters only. At Provide LUT/ Bond details, set Yes if applicable, else set No. When you set Yes, you get LUT/ Bond Details screen to enter the LUT / Bond  Number. You get another screen to enter the validity period (From & To). On enter of validity period, it is reflected at LUT/ Bond Details screen (once the period is entered, the period entry screen cannot be accessed any more to edit).

Company GST Rate set up in Tally

When you set Yes at Set / Alter GST rate Details, you get GST Details entry screen, to enter GST Rate applicable for the Company. This is useful when a single GST Rate is applicable for all products the Company. Now set as follows:

  • Taxability : At Taxability, select the Taxability option from the list.
  • Tax Rate : At Rate column, at Integrated Tax Rate, enter the GST Rate.The Rate entered here would be carried as default and you need not enter GST rates in individual Stock Items.

GST Rates entry at Company Level : At GST Details entry screen, you may enter either Integrated GST rate (IGST), or separate Rate split up for CGST & SGST. The rates of CGST and SGST will be auto computed as half of the rate for IGST. Single IGST rate is easier & simpler.

GST rate entry (combined rate), at Company level in Tally

To enterGST rate details shown separately for IGST, CGST & SGST, at Tax details entry screen , Click F12:Configure to get Configuration screen . At Show all GST Tax Types , set Yes to get the screen showing input fields for all the 3 types of GST , else set No to get only IGST field .

GST rate entry (separate rate), at Company Level in Tally

Enter the Rate for Integrated Tax (IGST) only. Half of the rate as entered for IGST, is auto filled at Central Tax (CGST) and State Tax (SGST) fields .

Company GST Set up Configuration in Tally

Company GST Rate configuration in Tally

GST Rate Activation: The decision to activate GST rate at Company level is very Important at the beginning stage.  At Set / Alter GST Rate details :

  • Single GST rate for all Products : Set Yes only if same GST rate is applicable to all Products
  • Different GST rates: If different GST rates applicable, set No. In that case, you will enter the GST Details at lower level masters (like Stock Group / Stock item), as discussed next.

We recommend to set No (always) to this option, so that in future if any product with different GST rate is added, you can easily set the different Rates at Product level. You get complete flexibility for future additions of all sorts of Items and change rate as per law and notifications.

GST Classification Activation in Tally

The decision to activate GST Classification Master is very Important at the beginning stage.  You must understand the implications of this option and decide properly, according to variety of GST rates for products dealt and the number of products bearing same GST Rate.

At Enable GST Classification :

  • Few Products with same GST Rate : If you have a few Products only with same GST rates, you may set No at this option. In that case, you will enter the GST details at lower level masters (like Stock Group / Stock item), as discussed next.
  • Many Products with same GST rate : If you have large number of different products (or different variations of same product like design, size, model, brand etc. which are treated as different Stock Items in Inventory System), but having same GST rate, you may set Yes at Activate GST Classification. Consequently, you can create GST Classification Master at GoT>Accounts Info>Statutory Info>GST Classification, as explained later.
  • Implication of GST Classification : On creating GST Classification, you do not have to repeat same GST details in each Stock Item. Just link (select) the respective GST Classification Master with the Stock Item. The Item creation would be quicker and error free.

However, when you link an Item with GST Classification code, you will not be allowed to enter or modify GST details at lower level (like in Stock Group or Stock Item level). So, though GST Classification apparently may lure you to save rate entry time, it hides the applicable rate for the Item from view and Tax rate is internally pulled up (automatically) during Invoice entry. So, decide yourself, depending on your way of working and Item / rate structure. Tally provides several options

GSTIN Structure

The entire GSTIN (Goods & Services Tax Identification Number) is a unique 15 letter code (2 digit State Code+ 10 letter PAN+ 1 digit Serial Number + 1 letter dummy (any letter) + 1 letter Check digit) allotted to each Registered Dealer, on registration under GST rules.

By GSTIN, the organisation is uniquely identified. This ID must be used in every document or anything related to GST matter.

  • State Code (1-2) : First 2 digits of the GSTIN / UIN code refers to the code allotted for each State / UT. So, the code must match with the State selected at the Company creation screen.

Tally verifies the State Code (first 2 digits of the GSTIN entered) with State as entered, and reports error if these do not match.

  • PAN (3-12): The next 10 letters are the PAN of the organisation, as it is. The first 5 letters of the 10 digit PAN is alpha, the next 4 digit is numeric and the last digit of PAN is alpha.
  • Serial Number (13) : The next digit is normally 1 (indicating the first registration number for the PAN). If the organisation have multiple registration under same PAN (for example in different types of business) within the State, then the digit for the successive units would be 2, 3 etc).

An organisation, having same PAN, would have different registration for each State & Vertical Businesses. Assuming that the 13 the digit may be a numeric or Alpha, an organisation with a specific PAN can have maximum (theoretically), 9+26=35 different GSTIN.

  • Dummy (14): The next digit may be anything (it is Z by default). It is left unspecified for future use.
  • Check Digit (15) : The last digit indicates the check digit, which is derived by applying some mathematical formula (checksum) on the first 14 digits, to ensure correct entry of the GSTIN.

If any digit in typing the first 14 letters in wrong (or transposed), the check digit won’t match and the entry would be trapped as error. So, errors in typing GSTN are trapped.

GSTIN : 19ADPEG2345K1Z4

So, if an organisation having PAN such as ABPDE1234V will have GSTIN such as follows:

08ABPDE1234V1Z4 for Delhi

04ABPDE1234V1Z3 for Chandigarh

09ABPDE1234V1Z2 for Kanpur

09ABPDE1234V2Z6 for Lucknow

In Uttar Pradesh, it has 2 offices, the 13th  letter is 1 for Kanpur, 2 for Lucknow. If it opens any more branch in UP, it will have 3 as 13th letter, but the first 2 digits & next 10 digits would be same (like 09ABPDE1234V3Z8)

List of GST State / UT Code : The first 2 letters of GSTIN represent State / UT code (allotted as per Indian Census 2011), as follows:

01: Jammu & Kashmir, 02 : Himachal Pradesh, 03 : Punjab, 04* : Chandigarh, 05:Uttaranchal, 06 : Haryana, 07* : Delhi, 08 : Rajasthan, 09 : Uttar Pradesh, 10 : Bihar, 11: Sikkim, 12 : Arunachal Pradesh, 13 : Nagaland, 14 : Manipur, 15 :Mizoram, 16 : Tripura, 17 : Meghalaya, 18 : Assam, 19 : West Bengal, 20 : Jharkhand, 21: Odisha, 22 : Chhattisgarh, 23 : Madhya Pradesh, 24 : Gujarat, 25* : Daman & Diu, 26* : Dadra & Nagar Haveli, 27 : Maharashtra, 28 : Andhra Pradesh, 29 : Karnataka, 30 :Goa, 31* : Lakshadweep, 32 : Kerala, 33 : Tamil Nadu, 34*: Pondicherry, 35* : Andaman & Nicobar Islands, 36 :Telangana

[Note: Union Territories (UT) Codes are marked with *]

Company GST Set up  key steps in Tally

GST Activation :  Click F11:Compnay Features to get Company Features Menu . Select Statutory & Taxation to get Statutory & Taxation screen. Set Yes at GST Details to enter GST Details

GST Rate set up : It is advisable to set Yes at Set Alter Rate GST Details only if single Tax Rate is applicable for all Products dealt with by the organisation, otherwise set No (recommended). Similarly, you should seriously think and plan whether you need to create GST Classification. Set No at Enable GST Classification (recommended). These two aspects are explained in details in next chapter (you may change these options later at any time). So, you may leave No at these 2 options, for the time being (and change later as required).

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