Tally.ERP 9 facilitates defining excise details at different levels. This provides the convenience of applying tax rules at the highest level, which is the company level, as well as the flexibility to modify, override or define details at the lower levels, based on one's business requirement.
For example,
The business is dealing with different types of batteries and if all the items are attracting the same VAT rate, the tax rate can be defined at the company level.
If the business is dealing with batteries and leather goods, then the tax rates are different, then the tax rate can be defined in the stock group level.
The user can define the rules at the company level and override at the lower level. The rules can be inherited as follows:
● Company
● Stock Group
● Stock Item
● Ledger Group
● Ledger
● Transaction
● Transaction Entry
Note: The rules that are defined at the voucher type or voucher type class level will be used as template, thereby it will be used ONLY to fill the values in the transaction by default in create mode.
After migrating to release 5.0, you can start recording invoices. If these are transactions that have statutory implications, then the required masters have to be configured. In most scenarios the business can define the tax rules in few minutes and start recording transactions.
● I am dealing with stock items which have the same excise duty rate.
For a business with all stock items having the same excise rate, the tax rates can be defined in the company level. The rates once defined, will be automatically applied to all the stock items.
To define excise rates at the company level
1. Go to Gateway of Tally > F11: Features > Statutory & Taxation.
2. Set the option Enable excise to Yes.
3. Enable the option Set/Alter excise Details
4. Enter Excise Details.
In the Excise Registration Details screen, enable Set/ alter excise tariff details.
In the Excise Tariff Details screen
Enter Tariff name.
Enter HSN code.
Enter Reporting unit of measure.
Select the Valuation type.
Enter the Rate.
5. Press Enter to save.
6. Enter the PAN/Income - Tax No.
7. Enter the Corporate Identity No (CIN).
8. Press Enter to save.
When a transaction is recorded, the defined rate will be applied automatically.
One of the following modes can be applied.
Mode 1: Define duty rate at the company level, and apply it for the stock items with common excise duty rate.
Mode 2: Define duty rates at the stock group level/ stock item level.
Company Level |
1. Go to Gateway of Tally > F11: Features > Statutory & Taxation. 2. Set the option Enable Excise to Yes. 3. Enable the option Set/Alter Excise Details. 4. Enter Excise Details. In the Excise Registration Details screen, enable Set/ alter excise tariff details. In the Excise Tariff Details screen 1. Enter Tariff name. 2. Enter HSN code. 3. Enter Reporting unit of measure. 4. Select the Valuation type. 5. Enter Rate. 5. Press Enter to save. 6. Enter the PAN/Income - Tax No. 7. Enter the Corporate Identity No (CIN). 8. Press Enter to save. When a transaction is recorded, the defined rate will be applied automatically. |
Stock Group Level |
1. Go to Gateway of Tally > Inventory Info. > Stock Groups > Alter. 2. Select the required Stock Group. 3. Enable Set/ Alter Excise Details. In the Excise Tariff Details screen, 1. Enter Tariff name. 2. Enter HSN code. 3. Enter Reporting unit of measure. 4. Select the Valuation type. 5. Enter the Rate. 4. Press Enter. 5. Press Ctrl+A. |
Stock Item Level |
1. Go to Gateway of Tally > Inventory Info. > Stock Items> Alter. 2. Select the required Stock Item. 3. Enable Set/ Alter statutory details. 4. Select Applicable in the field Excise Applicable?. 5. Enable Set/ Alter Excise Details. In the Excise Tariff Details screen, 1. Enter Tariff name. 2. Enter HSN code. 3. Enter Reporting unit of measure. 4. Select the Valuation type. 5. Enter the Rate. 6. Select the Type of Stock Item. 7. Enter the Conversion Factor. 8. Press Enter. 9. Press Ctrl+A. |
The tax rate can be defined at the stock group level.
In this case, the tax rate can be defined at the stock group level. If any of the stock items have a different duty rate from the stock group, then the tax rate can be defined at the stock item level. This will override the details specified in the stock group level.
Stock Group Level |
1. Go to Gateway of Tally > Inventory Info. > Stock Groups > Alter. 2. Select the required Stock Group. 3. Enable Set/ Alter Excise Details. In the Excise Tariff Details screen, 1. Enter Tariff name. 2. Enter HSN code. 3. Enter Reporting unit of measure. 4. Select the Valuation type. 5. Enter the Rate. 4. Press Enter. 5. Press Ctrl+A. |
Stock Item Level |
1. Go to Gateway of Tally > Inventory Info. > Stock Items> Alter. 2. Select the required Stock Item. 3. Enable Set/ Alter statutory details. 4. Select Applicable in the field Excise Applicable?. 5. Enable Set/ Alter Excise Details. In the Excise Tariff Details screen, 1.Enter Tariff name. 2. Enter HSN code. 3. Enter Reporting unit of measure. 4. Select the Valuation type. 5. Enter the Rate. 6. Select the Type of Stock Item. 7. Enter the Conversion Factor. 8. Press Enter. 9. Press Ctrl+A. |
In this case, you can create commodity and tax details as a master and apply to stock groups or stock items
To use the custom commodity and tax details
● Enable VAT commodity and tax details as masters.
To enable Excise Tariff and duty details as masters
Go to F11 (Features) > F3 (Statutory and Taxation).
Enable Set/ alter Excise Details.
Enable Define Excise tariff and duty details as masters.
Press Ctrl+A.
● Create excise classification.
To create Excise Classifications
Go to Gateway of Tally > Accounts Info. > Statutory Info. > Excise Classifications > Create.
Enter the Classification Name.
Enter HSN code.
Select the Reporting unit of measure.
Select the Valuation type.
Enter the Rate.
Press Enter.
The classification created, can be selected in a stock item or stock group to use the duty rate defined.
● Assign the excise classification to stock groups/ stock items.
To assign the excise classifications to a stock group
Go to Gateway of Tally > Inventory Info. > Stock Items > Alter.
Enable Set/ alter Excise Details?.
Select the required Classification.
The classification created, will be available in the List of Classifications.
Press Ctrl+A.
To assign the Excise Commodity to a stock item
Go to Gateway of Tally > Inventory Info. > Stock Items > Alter.
Select Applicable in the field Excise Applicable.
Enable Set/ alter Excise Details?.
Select the required Classification.
The classification created, will be available in the List of Classifications.
Press Ctrl+A.
Tally.ERP 9 identifies if the nature of the transaction (local/ interstate, or export/import) using the state or country name entered in the party's ledger master. If the party's location has not been defined, then the VAT amount will not be calculated in the transaction.
To set the party's location
1. Go to Gateway of Tally > Accounts Info. > Ledgers > Alter.
2. Select the party ledger.
3. Select the Country.
4. Select the State.
5. Enter the Pincode.
6. Press Ctrl+A.
If MRP is applicable for the stock item and the tax is calculated based on MRP, then MRP has to be configured in the stock item as MRP is enhanced to capture based on the period and state.
To configure MRP Details
1. Set the option Allow MRP/ Marginal for Stock Items to yes in the Stock Item Details Configuration screen.
2. Enable Calculate Duty on MRP in the Excise Tariff Details screen.
3. Enter the Abatement %.
4. Press Enter.
The tax type of the duty ledgers used in transactions should be set to CENVAT.
To configure CENVAT duty ledgers
1. Go to Gateway of Tally > Accounts Info. > Ledger > Alter.
2. Select the duty ledger.
3. Select the Type of Duty/Tax as CENVAT.
4. Select the applicable Duty head.
5. Accept the Ledger Alteration screen.
The Tax Rate Setup tool to easily update excise tariff rates for all stock groups and stock items after migration is available in Tally.ERP 9 release 5.1 onwards. Click here to know more.
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