Mr. Varun has written this excellent Vat guide in Tally to assist Tally community. Varun loves to help tally user community. This is an extensive guide which is very useful for beginners as well as advanced users of Tally.erp 9
Vat guide in Tally | Examples
Sales for specific type debtors with VAT Class
There are instances when you have a specific customer whom you want to give a predetermined discount irrespective of the item he purchases. These are special customers. Vat guide in Tally in pdf format will help you to understand it properly
let’s assume, I am a mobile dealer. I have two sets of customers
Retailers and Wholesalers
I have a fixed price for retailers and a discounted price for wholesalers
This article will help you how to activate discounts at the time of entry and this can be done
from ( press F11 and then F2)
However this consumes extra time and effort, so what is the solution to have a fixed system so that Tally understands who those special customers are, who will be getting the products at a discounted rate.
Mr .Bhogle is a retailer and I will be selling to him at regular price, while MrModi is a wholesaler and I will be making all my sales to him at 5% discount irrespective of the quantity.
Vat guide in Tally | Two Case study
Let us examine the two scenarios:
For this purpose, you should have a clear understanding of the ledger and related grouping.
I will put Mr. Bhogle under a group named Retail Debtors( a sub group of Sundry Debtors) and Mr. Modi will be put under a group named ( Whole sale debtor- a sub group of Sundry Debtors)
Mr. Bhogle buys mobile XEON
Now Mr. Bhogle is a retail debtor and hence he is not liable for any discount.
But Mr. Bhogle might buy mobiles that have different VAT rates.
So let us understand the problem once again and see how that can be tackled.
The problem is – Mr. Bhogle (a Retail Debtor who is not liable for any discount) buys mobiles of different types of mobiles (both 4% and 13.5% VAT applicable rates)
We have considered two items of XEON mobile one with 4% and the other with 13.5% VAT rates. These rates are given at the time of master creation itself.
Vat guide in Tally | Screen shots of All Ledgers and Vouchers
We create a ledger (Mr. Bhogle) as
Now go to the sales voucher and alter
Then for VAT Retail create :-
. Similarly, a ledger is created for the special discount customer named Mr.Modi
Now we again go the sales voucher and alter for VAT Wholesale
A new ledger named Discount is created under Total Sales and -10% is given
If a discount of 10% is given.
Now go to accounting vouchers à Sales à and then make sales and select the class Whole sale or Retail
Now only those debtors falling under the Retail or wholesale group would be visible.
The screen looks like :-
Handling Vat in Tally with Item master
Items- Lets us create the item ledger for mobile phones named XEON at 12.5% and Xeon at 13.5%
Go to the Item creation master by going to gateway of Tally and then pressing enter to Create Items
Item master configuration
Then press F12 and change this to YES as shown below
Now create an item – named XEON 12.5%
Then set the default ledger for accounting as :-
Once this is done your item is ready, similarly create an item named XEON 13.5% in this manner.
Once this is done, you can go to the sales voucher and make the sales by selecting the vat class as Retailer- where only Mr Bhogle is shown.
We see that automatically the VAT rates are calculated and a sales voucher is also prepared.
Now similarly we create a sales voucher for the Wholesaler Mr.Modi
Go to the sales voucher:-
And then select the VAT class as Wholesale:-
Voucher class is a special class of voucher and very useful to pass sales / Purchase entry with correct duty ledger and auto calculation of duties without any errors.
If you don’t know how to create a Voucher class in Tally.ERP 9, then this handy guide might be useful for you.
Now the items are selected and the rates are calculated automatically.
Not only are the VAT rates calculated correctly. We also see the Discount being given to Mr.Modi @10% as we had set in the Wholesale – Class in the sales voucher.
Do let’s share you views how you handle Vat in accounts ?