Recording Notional Tax Credit - Capital Goods (Chandigarh)

You can record notional tax credits on capital goods in a journal voucher by making the necessary stat adjustments.

To record the notional tax credit on capital goods in journal voucher

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

2.     Click J: Stat Adjustment. In the Stat Adjustment Details screen

o      Select Type of duty/tax as VAT.

o      Select Notional Input Tax credit as the Nature of Adjustment.

o      Select on Capital Goods in Additional Details section.

Note: Based on the selection made for Nature of Adjustments, the Additional Details option either appears or disappears.

o      Press Ctrl+A to return to the voucher.

3.     Debit the notional input tax ledger.

Note: To identify a ledger for notional tax, in the ledger grouped under Duties & Taxes with Type of duty/tax set to VAT, set the option Use for Notional ITC to Yes.

4.     Select the purchase reference and enter the purchase details in Credit Settlement Details screen.

5.     Enter the tax amount.

6.     Credit the VAT ledger.

7.     Press Ctrl+A to save.