Decrease of Input Tax

Tax adjustment required due to decrease in input tax can be recorded by creating a journal voucher with the Nature of adjustment as Decrease of Input Tax.

To create journal voucher for decrease of input tax

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

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

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

o      Select the option Decrease of Input Tax in the Nature of adjustment field.

o      Press Enter to save, and return to voucher screen.

3.     Debit the CST ledger.

o      Enter the Rate and Assessable Value in the VAT Details screen.

o      Press Enter to return to voucher screen.

4.     Enter the amount in the Debit column.

5.     Credit the VAT ledger.

o      Enter the Rate and Assessable Value in the VAT Details screen.

o      Press Enter to return to voucher screen.

6.     Set the option Provide VAT Details to Yes and enter the From and To dates, else retain it as No.

Note: The option Provide VAT Details is provided as per state specific requirements of VAT/CST forms and annexures. In this example, the State is selected as Bihar.

7.     Enter Narration, if required. The journal voucher appears as shown below:

8.     Press Enter to save.