The input tax credit on capital goods is claimed in three equal installments starting from purchase period and remaining in equal installments in subsequent years. The input credit claim is recorded using journal voucher.
To record purchase of capital goods
1. Go to Gateway of Tally > Accounting Vouchers > F9: Purchases.
2. Press Ctrl+V to switch to voucher mode.
3. Click F12: Configure twice, set the option Allow expenses/fixed assets in purchase vouchers? to Yes.
4. Press Ctrl+A twice to save and return to voucher screen.
5. Enter Supplier Invoice No. and Date.
6. Credit the party ledger and enter the amount in Credit column.
7. Debit the fixed assets ledger (grouped under Fixed Assets and with Purchase Taxable - Capital Goods selected as Nature of transaction) and enter the assessable value.
8. Debit current assets ledger created under Current Assets.
o Enter Commodity Name, Commodity Code, Assessable Value, Rate, and VAT Amount Claimable in the Input Credit Details screen.
o Press Enter to return to voucher screen.
The purchase voucher appears as shown below:
9. Press Enter to save.
To reverse the input tax credit for purchase of capital goods
1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal.
2. Click J: Stat Adjustment.
o Select VAT as the Type of duty/tax.
o Select Input Tax Credit Admitted On Capital Goods as the Nature of adjustment.
3. Debit VAT ledger, enter Amount Claimed for the reporting period in VAT Details screen.
o Press Enter.
4. Credit the current assets ledger that was debited in the capital goods purchase transaction.
The journal voucher appears as shown below:
5. Press Enter to save.