https://help.tallysolutions.com/docs/te9rel64/Tax_India/gst/recording_jv_for_adjustments_against_tax_credit_under_gst.htm

Recording Journal Vouchers for Adjustments Against Tax Credit under GST

The tax credits of central tax, integrated tax and state tax can be used to set-off the liability of central tax, state tax/UT tax and integrated tax in the order specified under GST.

The order in which tax credit can be offset is given below:

Input Tax Credit

Set-off against the Liability

Central tax

Central tax and integrated tax (in that order).

Integrated tax

Integrated tax, central tax, state tax/UT tax (in that order).

State tax/UT tax

State tax/UT tax and integrated tax (in that order).

To record a journal voucher for cross utilisation of tax credits

1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal .

Note: You can also create a journal voucher from Gateway of Tally > Display > Statutory Reports > GST > GSTR-1 or GSTR-2 .

2. Click J : Stat Adjustment .

3. In the Stat Adjustment Details screen, select the options as shown below:

4. Press Enter to save and return to the journal voucher.

5. In the journal voucher, debit and credit the ledgers as per the scenarios mentioned below:

Scenario

Debit Ledger

Credit Ledger

Utilisation of central tax credit, when only central tax credit is available.

Debit the central tax ledger

Enter the amount to the extent of credit available.

Credit the central tax ledger to set-off the payable amount against the available credit.

Utilisation of central tax credit, when central tax and integrated tax credits are available.

Debit the central tax ledger.

Enter the amount to the extent of credit available.

Credit the central tax ledger, and enter the total amount payable.

Credit the integrated tax ledger if the tax credit remains after it is set-off against central tax dues.

Utilisation of state tax credit, when only state tax credit is available.

Debit the state tax ledger.

Enter the amount to the extent of credit available.

Credit the state tax ledger to set-off the payable amount against the available credit.

Utilisation of state tax credit, when state tax and integrated tax credits are available.

Debit the state tax ledger.

Enter the amount to the extent of credit available.

Credit the state tax ledger, and enter the total amount payable.

Credit the integrated tax ledger if the tax credit remains after it is set-off against state tax dues.

Utilisation of integrated tax credit, when only integrated tax credit is available.

Debit the integrated tax ledger.

Enter the amount to the extent of credit available.

Credit the integrated tax ledger to set-off the payable amount against the available credit.

Utilisation of integrated tax credit, when integrated tax and central tax credits are available.

Debit the integrated tax ledger.

Enter the amount to the extent of credit available.

Credit the integrated tax ledger, and enter the total amount payable.

Credit the central tax ledger, if the tax credit remains after it is set-off against integrated tax dues.

Utilisation of integrated tax credit, when integrated tax, central tax and state tax/UT tax credits are available.

Debit the integrated tax ledger.

Enter the amount to the extent of credit available.

Credit the integrated tax ledger, and enter the total amount payable.

Credit the central tax ledger, if the tax credit remains after it is set-off against integrated tax dues.

Credit the state tax ledger, if the tax credit remains after it is set-off against central tax dues.

Utilisation of cess credit, when only cess credit is available.

Debit the cess ledger.

Enter the amount to the extent of credit available.

Credit the cess ledger to set-off the payable amount against the available credit.