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Increase in Tax Liability - Interest (Andhra Pradesh)

Tax liability due to interest can be adjusted by creating a journal for interest payable.

To record journal entry to account for interest payable

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

Note: You can create a journal voucher from Gateway of Tally > Display > Statutory Reports > VAT > select the VAT or CST form.

2. Click J: Stat Adjustment . I n the Stat Adjustment Details screen,

o Select the option VAT in the field Type of duty/tax .

o Select the option Increase of Tax Liability in the Nature of Adjustment field.

o Select Interest for the option Additional Details .

o Press Ctrl+A to save and return to the voucher creation screen.

3. Press Enter to return to voucher.

4. Debit an expense ledger created under Indirect Expenses with option Is VAT/CST Applicable? set to Not Applicable .

5. Credit the ledger created under Current Liabilities . The completed screen appears as shown below:

6. Press Enter to save.