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Record Advances Received Under GST in TallyPrime

As a supplier of services, you may require an advance payment at the time of receiving a purchase order to safeguard the expenditure on resources required for a specific service. For instance, there is an order for glass-coating 8,000 sq. meters of a pipeline in a power plant project. In such a case, you may require an advance payment from the party to secure the manufacturing and supply cost of the coating material.

So, in your business, there can be situations in which you will receive advance payments from parties. As perĀ Section 12 to 14 of the CGST Act, 2017, the time of the supply of services decides the period in which you need to pay GST, and the time of supply is considered as per the voucher date of the advance payment received from the party.

So, if the purchase orderĀ is of INR 10 lakhs issued for the supply of services in the month ofĀ Jul-22, andĀ you have an advance receipt of INR 1 lakh in the month of May-22, then you will need to pay GST for:

  • INR 1 lakh in the May-22 return period.
  • The rest of the sum (9 lakh), as per the voucher date on which the party gives the rest of the payment.

Advance receipts for composition dealers

It is important to note that as perĀ notification 66/2017 dated 15.11.2017, if you have not opted for the composition scheme, then you are not liable to pay GST on the advances received.

All-new advance receipt experience in TallyPrime Release 3.0

In TallyPrime Release 3.0 onwards, you can account for the advances received under GST using the Advance Receipt voucher with automatic computation of the liability on the voucher. Subsequently, the voucher will reflect in the Table 11 ofĀ GSTR-1Ā in TallyPrime with the period and the type of tax to be paid as per the place of supply.

Flexibility to follow journal voucher approach

You can also use Journal vouchersĀ to record advance receipts, if you follow the practice in your business.

Adjustment of advance received in sales invoice

If you have certain unadjusted advance amount, then TallyPrime Release 3.0 and onwards, you have a facility to specify the amount so that you can easily adjust the same in your sales invoices.

Refund of advance received

In case of refunds, you can create a Credit Note and the liability against the advance amount received gets reversed automatically, while you have the flexibility to reverse the liability using a Journal voucher.

In this topic, you will understand the procedures to account for the GST advances received in TallyPrime, setting off the advances received in a sales invoice, and how to record the refund of an advance received.

Set Up TallyPrime to Set OffĀ GSTĀ Advance Receipts in Sales Invoices

You will need to set up TallyPrime to record GST advance receipts in TallyPrime. The setup will enable you to set off GST advances received from parties in sales invoices.Ā 

If you do not want to set off GST advances in sales invoices, then you do not need to set up TallyPrime for it.Ā In that case, you can follow the procedure you followed in TallyPrime Release 2.1 or earlier.Ā To know how to do it, refer to Account forĀ Advance Receipts Under GST for TallyPrime Release 2.1 or Earlier.

  1. PressĀ F11Ā (Company Features) >Ā Set/Alter Company GST Rate and Other Details:Ā YesĀ and pressĀ Enter.
    Set or Alter GST Rate and Other Details to Yes under F11 Features in TallyPrime
    TheĀ GST Rate and Other DetailsĀ screen appears.
  2. Show GST Advances for adjustments in transaction:Ā Yes.
    An information screen appears.
    Information Screen While Enabling Advance Adjustment in Voucher in TallyPrime
    If you have received some advance amount from a party that you are yet to adjust in sales invoice, then you can specify the same usingĀ GST Advances ā€“ Opening Balance.
    To know how to do it, refer to theĀ Provide Opening Balance for Unadjusted GST Advances ReceivedĀ section.
  3. Enter theĀ Applicable fromĀ date.
    Show GST Advances for Adjustments in Transaction to Yes in TallyPrime
    You will be able to set off GST advance receipts in sales invoices right from theĀ Applicable fromĀ date.
    For example, if you enter 1-Apr-22, then you can adjust advances in sales invoice, from 1-Apr-22 onwards.

    It is necessary to enter a date that falls after the Return period in which you had reported GST liabilities using Journal vouchers. This ensures that your GST returns until that period remains unaffected.
    For instance, if you hadĀ reportedĀ GST liabilities using Journal vouchers until 31-Mar-22, then theĀ Applicable fromĀ date must be 1-Apr-22 or laterĀ than that.
    This ensures that the GST returns of 31-Mar-22 and earlier remain unaffected and theĀ Journal vouchersĀ are retained in the GST returns.
    In this case, if theĀ Applicable fromĀ date is set 31-Mar-22 or earlier, then TallyPrime starts reporting GST liabilitiesĀ in the GST ReturnsĀ based on the Advance Receipts, thereby replacing the Journal vouchers with Advance Receipts.

To know how to adjust advance amount in sales invoice, refer to theĀ Adjust GST Advances ReceivedĀ section.

If you have multiple GST registrations, then the setting will get implemented for all the GST registrations.

Raise Tax Liability for Advances ReceivedĀ 

There may be some advances for which you have recorded the vouchers, but you are yet to raise the tax liability in TallyPrime.

You can record a Journal voucher to raise the tax liability for such vouchers.Ā 

  1. PressĀ Alt+GĀ (Go To) >Ā Create VoucherĀ > pressĀ F7Ā (Journal).
  2. Specify the stat adjustment details.
    1. PressĀ Alt+JĀ (Stat Adjustment).
      TheĀ Stat Adjustment DetailsĀ screen appears.
    2. Type of duty/tax:Ā GST.
    3. Nature of Adjustment:Ā Increase in Tax Liability.
    4. Additional Details:Ā On Account of Advance Receipts.
      Stat Adjustment Details Screen in TallyPrime
  3. UnderĀ By, select the ledger for GST on Advance grouped underĀ ExpenseĀ and enter theĀ Amount.
  4. UnderĀ To, select theĀ SGST and CGSTĀ or IGST, as applicable, and enter theĀ AmountĀ against each ledger.
  5. Provide other necessary details, as needed, andĀ pressĀ Ctrl+AĀ to save.
    A sample Journal voucher recorded to raise the tax liability appears asĀ shown below:
    Journal Voucher to Raise the Tax Liability in TallyPrime

The Journal voucher for the tax paid on advance received appears under theĀ Tax Liability (Advances Received) – 11A(1), 11A(2)Ā section of GSTR-1.Ā 

Journal Voucher to Raise the Tax Liability in GSTR-1 of TallyPrime

ProvideĀ Opening Balance for Unadjusted GST Advances Received

You may have received some advance amount from a party that you are yet to adjust in sales invoice.Ā 

In TallyPrime Release 3.0, you have the facility to specify the unadjusted amount in the product so that you can adjust the same in sales invoices, whenever needed.

If you have any advance amount received from parties that is yet to beĀ adjustedĀ in sales invoices, then you can specify the amount inĀ GST Advances ā€“ Opening BalanceĀ in TallyPrime.

  1. PressĀ Alt+GĀ (Go To) > type or selectĀ GST Advances – Opening BalanceĀ and pressĀ Enter.
    TheĀ List of Unadjusted GST AdvancesĀ screen appears.
  2. SelectĀ Create Opening Balance (Advance Receipt)Ā and pressĀ Enter.
    TheĀ Opening Balance (Advance Receipt) CreationĀ screen appears.

    If you are using the multiple GST registrations feature of TallyPrime Release 3.0 or later releases, then you will need to select the GST registration.
    UnderĀ 
    GST Registration, select theĀ Registration NameĀ for which you want to provide the opening balance for advance receipt.

  3. Provide the party details.
    1. SelectĀ Party NameĀ fromĀ List of Ledger Accounts.
    2. Place of Supply: The place at which the party avails the services.
    3. Supply attracts Reverse Charge:Ā Yes, if the services fall under GST reverse charge mechanism.
      Otherwise, set it asĀ No.
  4. Provide the details of advances received.
    1. Date of GST Advances: TheĀ date on which you had received the advance from the party.

      The date should be earlier than theĀ Applicable fromĀ date that you entered while enablingĀ Show GST Advances for adjustments in transactionĀ underĀ F11.Ā 

    2. Taxability:Ā Taxable.
    3. GST Rate: The tax rate applicable to the service.
    4. Unadjusted Advance Amount: The amount received fromĀ the partyĀ on the date that has remained unadjusted.
    5. Taxable AmountĀ andĀ IGSTĀ orĀ CGSTĀ &Ā SGSTĀ get calculated based on the specifiedĀ GST RateĀ andĀ Place of Supply.
      You can add multiple GST advance amounts received from parties that are yet to beĀ adjusted.
      A sampleĀ Opening Balance (Advance Receipt) CreationĀ screen is as shown below:
      Opening Balance for Advances Received in TallyPrime
  5. As always, press Ctrl+AĀ to save.

Subsequently, you can set off the opening balance by selecting the amount while recording sales invoice for the party.

Record GSTĀ Advance Receipts in TallyPrime

Once you set up TallyPrime to account for advances received under GST from parties, you can record GST advance receipts.

  1. PressĀ Alt+GĀ (Go To) >Ā Create VoucherĀ > pressĀ F6Ā (Receipt).
  2. Specify the stat adjustment details.
    1. PressĀ Alt+JĀ (Stat Adjustment).
      TheĀ Stat Adjustment for: GSTĀ screen appears.
    2. Nature of Receipt: Advance Receipt.
      Selecting Nature of Transaction While Recording Advance Receipts in TallyPrime
  3. UnderĀ Account, select the cash or bank account fromĀ List of Ledger Accounts.
  4. UnderĀ Particulars, select the party.Ā 
    TheĀ Advance Receipt DetailsĀ screen appears.
  5. Specify the advance receipt details.
    1. Particulars: Select the sales ledger, as applicable.
    2. Advance Amount: Enter the advance amount received from the customer.
    3. Taxable Value: The system will take the taxable value, based on the ledger.
      Advance Receipt Details in TallyPrime
    4. PressĀ Ctrl+AĀ to accept the screen.
  6. Provide other necessary details, as needed, and pressĀ Ctrl+AĀ to save.
    A sample advance receipt voucher appears as shown below:
    Advance Received Under GST Recorded in TallyPrime

Once you record an advance received from a party, the voucher will be included in return and you can view it in GSTR-1 of TallyPrime.

InĀ GSTR-1 – Voucher Register, the voucher will appear asĀ Advance Receipts (Included in Returns).

  1. PressĀ Alt+GĀ (Go To), type or selectĀ GSTR-1Ā and pressĀ Enter.
    Alternatively,Ā Gateway of TallyĀ > Display More ReportsĀ >Ā GST ReportsĀ >Ā GSTR-1Ā and pressĀ Enter.
  2. Drill down on theĀ Included in ReturnĀ row to view the voucher.
    GST Advance Receipt in GSTR-1 of TallyPrime

Adjust GST Advances Received

Once youĀ record theĀ GST advance receipt or enter the unadjusted advance as opening balance, you can set off the amount received as advances while recording the sales invoice. TallyPrime Release 3.0 onwards, you have a facility to set off the advances received.

In this section

Set off GST advances received in sales invoice

In TallyPrime Release 3.0 or later releases, you can select the advance amount corresponding to the sales invoice and set it off while recording the sales invoice. TallyPrime automatically calculates the amount to be reflected inĀ the returns.

If you are following the process of recording Journal vouchers to set off advances, then you can do so to keep your books of accounts updated.Ā 

  1. Ensure that you haveĀ recordedĀ Advance ReceiptĀ orĀ provided Opening BalanceĀ for the unadjusted advanceĀ amount, as applicable.
  2. PressĀ Alt+GĀ (Go To) >Ā Create VoucherĀ >Ā pressĀ F8Ā (Sales).
  3. Select the party and provide the detailsĀ in theĀ Dispatch DetailsĀ andĀ Party DetailsĀ screens.
    In theĀ Party DetailsĀ screen,Ā PlaceĀ of SupplyĀ isĀ the place at which the the services are going to be availed.
  4. Select the service ledgers, and enter theĀ Amount.Ā 
  5. Select the IGST or SGST & CGSTĀ ledgers, as per theĀ Place of SupplyĀ mentioned in theĀ Party DetailsĀ screen, and pressĀ Enter.
  6. PressĀ EnterĀ on the totalĀ Amount, provide the Bill-wise Details for theĀ partyĀ and pressĀ Ctrl+AĀ to save.
    TheĀ Details of Advance Amount to be AdjustedĀ screen appears.
  7. Provide the details of advance amount that needs to be set off in the the sales invoice.
    1. Select the advance amount against which you are creating the sales invoice and pressĀ Enter.Ā 
      Details of Advance Amount to be Adjusted in TallyPrime

      1. The advances pending for adjustment are displayed based on the Applicable fromĀ date entered under theĀ Show GST Advance to set off in transactionsĀ in theĀ F11Ā features.
      If you have entered 1-Apr-22 as the applicability date, then the advance receipt amount recorded in the month ofĀ Mar-22Ā will not be displayed.Ā 
      2. This screen displays the advance amount only if the Advance Receipt voucher created for the same is in theĀ Included in ReturnĀ section of GSTR-1.
      If the sales invoice is uncertain due to mismatch of information or missing information, then even though you have set off the advance amount, TallyPrime will consider it unadjusted, until you resolve the invoice.

    2. Change theĀ Amount, if needed.
    3. PressĀ EnterĀ onĀ Show More, if you want to view more advance amounts pending for adjustment.
    4. PressĀ Ctrl+AĀ to accept the screen.
  8. Provide other necessary details, as needed, and pressĀ Ctrl+AĀ to save.
    A sample sales invoiceĀ for adjustment of the GST advanceĀ appears asĀ shown below:
    Sales Invoice with Adjusted Advance Receipt in TallyPrime

The amount of advance set off in the sales invoice gets deducted from the unadjusted advance amount.Ā 

If the sales invoice is lesser than the advance amount, then the differential advance amount appears as unadjusted, until you create a sales invoice for the party and adjust the amount in it.Ā 

However, if there is a case of sales return, you need to record a Credit Note for the party so that the amount starts appearing as unadjusted to set off in the sales invoice.Ā 

To know how to record a Credit Note for sales return of advance amount, refer to theĀ Record Refund of Advances ReceivedĀ section.

Auto Adjust GST AdvancesĀ received during voucher creation

You can set up TallyPrime to automatically adjust the advances received at the time of recording a sales invoice. In such a case, you will not need to select the amount of advance received to set off. On the other hand, TallyPrime will match the amount of advance received with the GSTĀ rateĀ and place of supply mentioned in the advance receipt voucher and the party ledger and set off the amount automatically, based on First In, First Out (FIFO) system.Ā 

  1. While recording a sales invoice, pressĀ F12Ā (Configure).
  2. Auto-adjust GST Advance during voucher creation:Ā Yes.
    Auto Adjust GST Advances in Sales Invoice During Voucher Creation in TallyPrime
  3. PressĀ Ctrl+AĀ to save the setting, as always.

Henceforth, while recording sales invoices, you will not get theĀ Details of Advance Amount to be AdjustedĀ screen to set off amounts corresponding to the advances received, as TallyPrime will automatically do so.

TallyPrime identifies the unadjusted advance amount received from the party and adjusts it in the sales invoice, based on the invoice amount.Ā 

Add sales returns amount to GST Advances for adjustment

For reasons such as cancellation of service order, a situation of sales returns may arise. In such a case, you will need to record credit note for sales returns.

For instance, you may be an advocate or a CA and may have received a service order with an advance payment, which gets cancelled later. So, you will need to account for sales returns in TallyPrime.

TallyPrime Release 3.0 onwards, you have a facility to add sales returns amount to the GST advances so that you can set it off in the future invoices.Ā 

While recording a credit note for the sales return, follow the step given below.

  1. PressĀ F12Ā (Configure) >Ā Add Returns Amount to GST Advance for adjustments:Ā YesĀ and pressĀ Ctrl+AĀ to save.
    Add Returns Amount to GST Advance for Adjustments in TallyPrime
  2. Provide GST details:Ā Yes.
    TheĀ Additional DetailsĀ screen appears.
  3. Provide the details regarding the credit note.
    1. Reason of Issuing Note: 01-Sales Return.
    2. Buyer’s Debit Note No.: The number on the debit note issued by the buyer for the sales return.
    3. Date: The date on which debit note was issued by the buyer.
      Additional Details in Credit Note Recorded for Sales Return in TallyPrime
    4. PressĀ Ctrl+AĀ to accept the screen.
  4. PressĀ EnterĀ on the totalĀ Amount.
    TheĀ Details ofĀ Advance Receipts to Update Advance AmountĀ screen appears.
  5. Select the advance amount from theĀ Advance Amount Pending for AdjustmentĀ list and pressĀ Enter.
    You can choose to set off more than one advance amount, as per the total amount in the voucher.
    Once you choose an advance amount, it gets added to the reference and starts appearing as pending for adjustment when you create a sales invoice.
    Moreover, you can also pressĀ EnterĀ onĀ Show Zero ValuedĀ and select a reference to which the value has to be added even though that reference does not have any value for adjustment.
    This is useful when the advance is fully adjusted. So, the reference becomes Zero Valued.
    When a sales return takes place and you choose the Zero Valued reference, the amount of sales return gets added to the Advance Amount Pending for Adjustment, which you can set off when you create a sales invoice for the party.Ā 
    Details of Advance Amount Pending for Adjustment in TallyPrime
  6. Provide other necessary details, as needed, and pressĀ Ctrl+AĀ to save.
    A sample Credit Note recorded for the sales returns appears as shown below:
    Credit Note Recorded for Sales Return to Update the Unadjusted Advance Received in TallyPrime

Once you record the credit note for a particular amount against a sales return, the total unadjusted advance in the next sales invoice you create will increase by the amount for which the credit note is created.

Record Refund ofĀ Advances Received

It may be possible that a party had paid you an advance, but later on, the party cancelled the order. So, you will be refunding the advance amount to the party. It may also happen that you will need to refund a certain part of the advance received on your service due to the decrease in the magnitude or duration of service you offered, as applicable.Ā Ā 

You can account for the refund amount using aĀ payment voucherĀ in TallyPrime.Ā 

For instance, consider that the amount received from the partyĀ as on date is as perĀ the screen shown below:

Advance Amount that needs to be Refunded to Party in TallyPrime

Now, consider that you need to make a refund of INR 30,000, as the party cancelled the order.Ā 

  1. PressĀ Alt+GĀ (Go To) >Ā Create VoucherĀ > pressĀ F5Ā (Payment)..
  2. Specify the stat adjustment details.
    1. PressĀ Alt+JĀ (Stat Adjustment).
      TheĀ Stat Adjustment DetailsĀ screen appears.
    2. Nature of Payment:Ā Refund of Advance Receipt.
      Stat Adjustment Details for Refund of Advance Received in TallyPrime
  3. UnderĀ Particulars, select the Party from List ofĀ Ledger Accounts.
    TheĀ Refund DetailsĀ screen appears.
  4. Provide the details of the refund.
    1. Ledger: Service ledger applicable to the advance receipt.
    2. Refund Amount: Enter the amount that you are refunding to the customer.
    3. PressĀ Ctrl+AĀ to accept the screen.
  5. Provide other necessary details, as needed, andĀ pressĀ Ctrl+AĀ to save.
    A sample payment voucher created for the refund of advance appears as shown below:
    Payment Voucher Recorded for Refund of Advance Received in TallyPrime

Account forĀ Advance Receipts Under GST for TallyPrime Release 2.1 or Earlier

If you are using TallyPrime Release 2.1 or earlier releases, then you will need to follow the Journal Voucher approach to account for advance receipts under GST. Click

Advance Receipts if Turnover is Less than Rs. 1.5 Crores

If your turnover in the previous financial year was less than Rs. 1.5 crores you need not pay tax on advance receipts. The tax liability calculation on advance receipts for supply of goods is disabled by default.

The journal transactions recorded to account for tax liability on advance receipts for supply of goods will not be included in GSTR-1 and GSTR-3B returns. All adjustment transactions recorded for this purpose using the following journal flags will be moved under Not relevant for returns in GSTR-1 and GSTR-3B reports.

Nature of Adjustment

Additional Details

Increase of Tax Liability

Advance Receipts for Export/SEZ sales

Increase of Tax Liability

On Account of Advance Receipts

Decrease of Tax Liability

Cancellation of Advance Receipts

Decrease of Tax Liability

Cancellation of Advance Receipts for Exports/SEZ sales

Decrease of Tax Liability

Sales against Advance Receipts

Decrease of Tax Liability

Sales against Advance Receipts for Export/SEZ sales

Advance Receipts if Turnover is More than Rs. 1.5 Crores

You can record the advance amount received from customers in a receipt voucher by marking it as advance receipt, and print it with the required GST details.

If the turnover of your business is over and above Rs 1.5 crores, set the option Enable tax liability on advance receipts to Yes in the Company GST Details screen to calculate tax liability on advance receipts. The liability will be included in GSTR-1 and GSTR-3B returns.

You need to pay GST on advance received for goods or services, if the supply is not fulfilled in the same period.

When a sales invoice is raised against an advance received in a different tax period, you need to track the sales against the advance received.

Advance receipt for orders completed in the same month

Advance receipt > Outward supply > File returns

Advance receipt for orders completed in subsequent month

Advance receipt > Raise tax liability > File returns > Outward supply in the next month > Reverse tax liability of advance amount > File returns

Advance receipt for orders cancelled in the same month

Advance receipt > Refund the amount > File returns

Advance receipt for orders cancelled in subsequent month

Advance receipt > Raise tax liability > File return > Refund the amount > Reverse the tax liability > File returns

Regular Taxable Transactions

Advance Receipt from Customer

To record a receipt voucher for advance received from customer

  1. Gateway of Tally > Vouchers > press F6 (Receipt).
    Alternatively, press Alt+G (Go To) > Create Voucher > press F6 (Receipt).
  2. Press Alt+J (Stat Adjustment) > select Nature of Receipt as Advance Receipt to mark the voucher for advance receipt.
  3. In Account select the bank to which the payment will be made.
  4. Select the Party Ledger. Ensure the bill-wise details is enabled in the ledger master.
    As always, press Alt+C, to create a master on the fly. Alternatively, press Alt+G (Go To) > Create Master > type or select Ledger > press Enter.
    The Advance Receipt Details screen appears with the list of stock items.
    1. To select a ledger, press Alt+L (Show Ledgers) .
    2. Press F12 (Configure) and set the options:
      1. Allow to provide rate of stock items? to Yes , to enter/alter the slab rate of the stock item.
      2. Allow to provide quantity for calculation of cess on quantity? to Yes , to enter the cess rate and cess rate per unit.
      3. Allow modification of tax details? to Yes , to override the GST and cess rates in the voucher.
    3. Select the stock item (goods enabled for GST) or ledger (services enabled for GST).
  5. Enter the Advance Amount , which is inclusive of GST . You can adjust this against the sales invoice partially/fully, based on the sale value. At the end of the month, depending on the balance amount of the advance available, you can record a journal voucher to raise the liability.
    Based on the amount entered, the break-up of the GST amount gets auto calculated for Central Tax , State Tax , and Cess , if applicable. The Advance Receipt Details screen appears as shown below:
  6. Press Ctrl+A to accept the Advance Receipt Details screen and return to the receipt voucher.
  7. Select the type of reference as Advance and enter the reference details in the Bill-wise Details screen.
  8. Accept the screen. As always, you can press Ctrl+Ato save.
  9. Press Alt+P (Print) in the payment voucher . To print the State Name , Code , and Place of Supply in the voucher, press F12 (Configure) and set the options as given below:
    1. Show State Name & State Code to Yes .
    2. Show Place of Supply to Yes .
    3. Set Print GST Advance Payment to Yes, as shown below:
  10. Press Enter to print.
    The printed receipt voucher with the GST details appears as shown below:

Journal voucher to raise the liability

To record a journal voucher to raise the liability

  1. Gateway of Tally > Vouchers > press F7 (Journal).
    Alternatively, press Alt+G (Go To) > Create Voucher > press F7 (Journal).
  2. Press Alt+J (Stat Adjustment) , select the options as shown below:
    • Type of duty/tax – GST.
    • Nature of Adjustment – Increase of Tax Liability.
    • Additional Details – On Account of Advance Receipts.
  3. Debit the expense ledger, or the ledger grouped under Current Assets.
  4. Credit the GST ledgers for the tax on advance receipt. Enter the tax Rate and Taxable Value in the GST Details screen displayed for each tax ledger.
  5. Set the option Provide GST Details to Yes .
  6. In the Statutory Details screen, select the party ledger.


    Place of supply has to be entered. You need not provide the party details.

  7. Press Enter to save.
  8. Accept the screen. As always, you can press Ctrl+A to save.
    The tax liability raised on the advance amount appears in GSTR-1 , as shown below:

Reversing the liability on advance receipt after sales

Sales invoice linked to an advance receipt voucher

When the sales invoice is recorded, the receipt voucher has to be linked to it by selecting the Type of Ref as Agst Ref in the Bill-wise Details screen of the sales invoice.

The GSTR-1 report displays the sales invoice, with tax on sales and advance amount as shown below:

To reverse the tax liability on advance receipt

  1. Gateway of Tally > Vouchers > press F7 (Journal).
    Alternatively, press Alt+G (Go To) > Create Voucher > press F7 (Journal).
  2. Press Alt+J (Stat Adjustment) , select the options as shown below:
    1. Type of duty/tax – GST.
    2. Nature of Adjustment – Decrease of Tax Liability.
    3. Additional Details – Sales against Advance Receipts.
  3. Debit the GST ledgers, and enter the tax Rate and Taxable Value in the GST Details screen displayed for each tax ledger.
  4. Credit the expense ledger, or the ledger grouped under Current Assets for tax on advance receipt.
  5. Set the option Provide GST Details to Yes . Enter the details of advance receipt and select the party ledger.

The GSTR-1 report appears as shown below:

Reversal of GST on account of cancellation of advance receipt

If an advance receipt voucher is recorded, a journal voucher is recorded to raise the tax liability, and then the transaction is cancelled partially or fully:

Record an advance receipt voucher as shown below:

Record a journal voucher to raise the tax liability as shown below:

To record a refund voucher

  1. Gateway of Tally > Vouchers > press F5 (Payment).
    Alternatively, press Alt+G (Go To) > Create Voucher > press F5 (Payment).
  2. Press Alt+J (Stat Adjustment) > select Nature of Payment as Refund of Advance Receipt to mark the voucher for advance receipt.
  3. Select the bank Account.
  4. Select the Party ledger. Ensure the bill-wise details is enabled in the ledger master.
    As always, press Alt+C, to create a master on the fly. Alternatively, press Alt+G (Go To) > Create Master > type or select Ledger > press Enter.
  5. Press F12 (Configure). Set the option Provide Party details for GST to Yes, to view the Party Details screen, and provide the relevant details.
  6. In the Refund Details section, the list of stock items appears for selection. To select a ledger, press Alt+L (Show Ledgers) . Press F12 (Configure) and set the options:
    • Allow to provide rate of stock itemsĀ to Yes , to enter/alter the slab rate of the stock item.
    • Allow to provide quantity for calculation of cess on quantityĀ to Yes , to enter the cess rate and cess rate per unit.
    • Allow modification of tax detailsĀ to Yes , to override GST and cess rates in the voucher.
  7. Select the stock item (goods enabled for GST) or ledger name (services enabled for GST).
  8. Enter the Refund Amount , which is inclusive of GST. The break-up of the GST amount gets auto calculated for Central Tax , State Tax , and Cess , if applicable. The Refund Details section appears as shown below:
  9. Press Ctrl+A to accept and return to the payment voucher.
  10. Select the type of reference as Agst Ref , and select the reference details in the Bill-wise Details screen.
  11. Set Provide GST details to Yes , and enter the Receipt No. and Date of the advance receipt.
  12. Accept the screen. As always, you can press Ctrl+A to save.
  13. Press Alt+P (Print) and select configure and set Print Refund Voucher to Yes , as shown below:
  14. Press Enter to print.
    The printed refund voucher appears as shown below:

To reverse the liability on cancellation of a transaction

  1. Gateway of Tally > Vouchers > press F7 (Journal).
    Alternatively, press Alt+G (Go To) > Create Voucher > press F7 (Journal).
  2. Press Alt+J (Stat Adjustment) , select the options as shown below:
    1. Type of duty/tax – GST.
    2. Nature of Adjustment – Decrease of Tax Liability.
    3. Additional Details – Cancellation of Advance Receipts.
  3. Debit the GST ledgers and credit the ledger grouped under Current Assets.
  4. Enable the option Provide GST Details?
  5. Enter the details of the receipt voucher and refund voucher, and select the party ledger as shown below:

    Place of supply has to be entered. You need not provide the party details.

  6. Press Enter to save. The journal voucher appears as shown below:
  7. Accept the screen. As always, you can press Ctrl+A to save. The GSTR-1 report appears as shown below:

Transactions under Reverse Charge

Advance Receipt from Customer

To record a receipt voucher for advance received from customer

  1. Gateway of Tally > Vouchers > press F6 (Receipt).
    Alternatively, press Alt+G (Go To) > Create Voucher > press F6 (Receipt).
  2. Press Alt+J (Stat Adjustment) > select Nature of Receipt as Advance Receipt to mark the voucher for advance receipt.
  3. In Account select the bank to which the payment will be made.
  4. Select the party ledger. Ensure the bill-wise details is enabled in the ledger master.
    The Advance Receipt Details screen appears with the list of stock items. To select a ledger, press Alt+L (Show Ledgers). Press F12 (Configure) and set the options:
    • 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 (services enabled for GST). Ensure the option Is reverse charge applicable is set to Yes in the GST Details screen of stock item or ledger master stock item if the party selected is a regular dealer.

    In the GST Details screen of the invoice, the option Is reverse charge applicable appears as set in the master, and the same configuration appears in brackets for reference. You can change this while recording the invoice, if required.

  6. Enter the Advance Amount , which is inclusive of GST . You can adjust this against the sales invoice partially/fully, based on the sale value. At the end of the month, depending on the balance amount of the advance available, you can record a journal voucher to raise the liability.
    Based on the amount entered, the break-up of the GST amount gets auto calculated for Central Tax , State Tax , and Cess , if applicable. The Advance Receipt Details screen appears as shown below:
  7. Press Ctrl+A to accept the Advance Receipt Details screen and return to the receipt voucher.
  8. Select the type of reference as Advance and enter the reference details in the Bill-wise Details screen.
  9. Accept the screen. As always, you can press Ctrl+A to save.
  10. Press Alt+P (Print) in the payment voucher . To print the State Name , Code , and Place of Supply in the voucher, press F12 (Configure) and set the options as given below:
    1. Show State Name & State Code to Yes .
    2. Show Place of Supply to Yes .
    3. Set Print GST Advance Payment to Yes, as shown below:
  11. Press Enter to print.
    The printed receipt voucher with the GST details appears as shown below:

Sales invoice linked to an advance receipt voucher

When the sales invoice is recorded, the receipt voucher has to be linked to it by selecting the Type of Ref as Agst Ref in the Bill-wise Details screen of the sales invoice.

The GSTR-1 report displays the sales invoice, with tax on sales and advance amount as shown below:

Reversal of Advance Amount on Account of Cancellation

If an advance receipt voucher is recorded, record a refund voucher to return the advance amount.

Record an advance receipt voucher as shown below:

To record a refund voucher for cancellation of advance amount

  1. Gateway of Tally > Vouchers > press F5 (Payment).
    Alternatively, press Alt+G (Go To) > Create Voucher > press F5 (Payment).
  2. Press Alt+J (Stat Adjustment) > select Nature of Payment as Refund of Advance Receipt to mark the voucher for advance receipt.
  3. Select the bank Account.
  4. Select the party ledger. Ensure the bill-wise details is enabled in the ledger master.
  5. Press F12 (Configure), set the option Provide Party details for GST to Yes to view the Party Details screen, and provide the relevant details.
  6. In the Refund Details section, the list of stock items appears for selection. To select a ledger, press Alt+L (Show Ledgers). Press F12 (Configure) and set the options:
    • 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 GST and cess rates in the voucher.
  7. Select the stock item (goods enabled for GST) or ledger name (services enabled for GST).
  8. Enter the Refund Amount , which is inclusive of GST. The break-up of the GST amount gets auto calculated for Central Tax , State Tax , and Cess , if applicable. The Refund Details section appears as shown below:
  9. Press Ctrl+A to accept and return to the payment voucher.
  10. Select the type of reference as Agst Ref , and select the reference details in the Bill-wise Details screen.
  11. Set Provide GST details? to Yes , and enter the Receipt No. and Date of the advance receipt.
  12. Accept the screen. As always, you can press Ctrl+A to save.
  13. Press Alt+P (Print) and select configure and set Print Refund Voucher to Yes , as shown below:
  14. Press Enter to print.
    The printed refund voucher appears as shown below:

    Similarly, record the transactions for the journal voucher adjustments given below:
    • Increase of Tax Liability > Advance Receipts for Export/SEZ sales – Debit expenses/current assets ledger and credit tax ledgers.
    • Decrease of Tax Liability > Cancellation of Advance Receipts for Exports/SEZ sales – Debit tax ledgers and credit expenses/current assets ledger.
    • Decrease of Tax Liability > Sales against Advance Receipts for Export/SEZ sales – Debit tax ledgers and credit expenses/current assets ledger.

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