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Purchase of Service (Service Tax)

You can record a purchase of services using the Purchase invoice. You can also record a purchase invoice for service inclusive of tax.

Single Service Received

D-Day Events is an event management company. They render event management services to their clients. They receive advertising service from AtoZ company.

On 01-06-2016, D-Day Events received advertising services worth ? 2,00,000 from AtoZ Company on which service tax is charged at 14.0%, and Swachh Bharat Cess (SBC) and Krishi Kalyan cess are charged at 0.50% each. The invoice number of the bill issued by AtoZ is AZ/04/025 dated 01-06-2016.

To record the transaction

1. Gateway of Tally > Vouchers > press F9 (Purchase).
Alternatively, press Alt+G (Go To) > Create Voucher > press F9 (Purchase).
Press Ctrl+H (Change Mode) to select the required voucher mode (Accounting Invoice, in this case)
2.Enter AZ/04/025 in the field Supplier Invoice No.
3.Enter 01-06-2016 in the field Date.
4.Select AtoZ Company in the field Party’s A/c Name.
5.Select the purchase ledger under Particulars.
6.Enter 2,00,000 in the field Amount.
7.Select service tax, SBC and Krishi Kalyan cess ledgers. The values are calculated automatically using the details defined at the ledger level.
8.To display the Tax Analysis screen
If you need to use this option only for the current invoice, press Ctrl+O (Related Reports) > type or select Service Tax – Tax Analysis > and press Enter.

If you are on TallyPrime Release 1.1.3 or earlier, follow the step:
If you need to use this option only for the current invoice, press Ctrl+I (More Details) > type or select Service Tax – Tax Analysis > and press Enter.
- Press Alt+F5 (Detailed) to view in detailed mode. The Tax Analysis screen appears as shown below:

Press Esc to return to sales invoice.

The Purchase invoice appears as shown below:

8.Press Enter to accept.

Purchase of Service Inclusive of Tax

On 01-06-2016, AtoZ Company received advertising services from CreativeIn Ad Firm worth ? 3,00,000, inclusive of service tax. Let us see how to record a purchase transaction for this scenario.

To record the transaction

1. Gateway of Tally > Vouchers > press F9 (Purchase).

Alternatively, press Alt+G (Go To) > Create Voucher > press F9 (Purchase).
Press Ctrl+H (Change Mode) to select the required voucher mode (Accounting Invoice, in this case)
2.Press F12 (Configure).
Set the option Allow Inclusive Tax during entry for Service Tax? to Yes.
Press Ctrl+A to accept.
3.Enter the Supplier Invoice No.
4.Enter the Date (supplier invoice date).
5.Select CreativeIn Ad Firm in the Party’s A/c Name field.
6.Select the purchase ledger under Particulars.
7.Enter 2,50,000 in the Enter Amount field as shown below:

8.Select duties and taxes ledger. The service tax, Swachh Bharat cess and Krishi Kalyan cess values will get calculated automatically using the details defined at the ledger level.
9.To display the Tax Analysis screen
If you need to use this option only for the current invoice, press Ctrl+O (Related Reports) > type or select Service Tax – Tax Analysis > and press Enter.

If you are on TallyPrime Release 1.1.3 or earlier, follow the step:
If you need to use this option only for the current invoice, press Ctrl+I (More Details) > type or select Service Tax – Tax Analysis > and press Enter.
- Press Alt+F5 (Detailed) to view in detailed mode. The Tax Analysis screen appears as shown below: