Reversal of Input Tax (VAT)
Reversal of input tax can be recorded by creating a journal voucher. Use Reversal of Input Tax as the Nature of Adjustment and debit the expenses under the group Indirect Expenses.
- Gateway of Tally > Vouchers > press F7 (Journal).
Alternatively, press Alt+G (Go To) > Create Voucher > press F7 (Journal). - Press Alt+J (Stat Adjustment) , select the options as shown below:
- Type of duty/tax – VAT.
- Nature of Adjustment – Reversal of Input Tax.
- Additional Details – Inter State Stock Transfer.
Note: The options for Additional Details are provided as per state specific requirements of VAT/CST forms and annexures. In this example, Bihar is selected as the State.
- Press Enter to save and return to the voucher screen.
- Debit the expense ledger.
- Enter the amount in the Debit column.
- Credit the VAT ledger, and enter the relevant details in the VAT Details screen.
- Set the option Provide VAT Details to Yes and enter the From and To dates, if required.
- Enter Narration, if required. The journal voucher appears as shown below:
- Accept the screen. As always, you can press Ctrl+A to save.
The states with Reversal of Input Tax available as the Nature of Adjustment are given below:
|
State Name |
Additional Details |
Voucher Entry |
|
Assam |
— |
Debit: Expense ledger. Credit: VAT ledger. |
|
Bihar |
Goods Damaged/Lost |
Debit: Ledger grouped under Indirect Expenses/Current Assets. Credit: VAT ledger. |
|
Goods Sold Below Purchase Price |
Debit: Ledger grouped under Indirect Expenses/Current Assets. Credit: VAT ledger. |
|
|
Goods Specified in Schedule-IV |
Debit: Ledger grouped under Indirect Expenses/Current Assets. Credit: VAT ledger. |
|
|
Inter State Stock Transfer |
Debit: Ledger grouped under Indirect Expenses/Current Assets. Credit: VAT ledger. |
|
|
Intra State Stock Transfer |
Debit: Ledger grouped under Indirect Expenses/Current Assets. Credit: VAT ledger. |
|
|
Sale of Goods in Schedule-I |
Debit: Ledger grouped under Indirect Expenses/Current Assets. Credit: VAT ledger. |
|
|
Transfer of Rights to Use Goods, Gifts Or Self Consumptions |
Debit: Ledger grouped under Indirect Expenses/Current Assets. Credit: VAT ledger. |
|
|
Chandigarh |
Not Applicable |
Debit: Expense ledger. Credit: VAT ledger. |
|
Apportionment of Input Tax for Tax Free Goods |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Apportionment of ITC for Branch Transfer |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Apportionment of Notional ITC for Manufacturing Tax Free Goods |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Cash Discount on Purchase |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Other Purchase Adjustment |
Debit: VAT ledger. Credit: Purchase ledger. |
|
|
Stock Transfer |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Trade Discount |
Debit: Party ledger. Credit: Purchase ledger. Credit: VAT ledger. |
|
|
Chhattisgarh |
Stock Transfer |
Debit: Purchase/expense ledger. Credit: VAT ledger. |
|
Dadra and Nagar Haveli |
Tax Credit Disallowed for Goods Lost Or Destroyed |
Debit: Expense ledger. Credit: Purchase ledger. Credit: VAT ledger. |
|
Tax Credit Disallowed in Respect of Stock Transfer Out of Dadra & Nagar Haveli |
Debit: Purchase ledger. Credit: VAT ledger. |
|
|
Delhi |
Goods Sold Below Purchase Price |
Debit: Purchase ledger. Credit: VAT ledger. |
|
Closing Stock |
Debit: Expense ledger. Credit: Purchase ledger. Credit: VAT ledger. |
|
|
Interstate Sales |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Tax Credit Adjustment on Sale Or Stock Transfer of Capital Goods |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Tax Credit Disallowed for Goods Lost Or Destroyed |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Tax Credit Disallowed in Respect of Stock Transfer Out of Delhi |
Debit: Expense ledger. Credit: VAT ledger. |
|
|
Goa |
Contingencies Covered U/S 9 Sub Sec 2, 3, 5 & 6 |
Debit: Purchase ledger. Credit: VAT ledger. |
|
Manufacturing of Exempt Goods |
Debit: Purchase ledger. Credit: VAT ledger. |
|
|
Others |
Debit: Purchase ledger. Credit: VAT ledger. |
|
|
Stock Transfer |
Debit: Purchase ledger. Credit: VAT ledger. |
|
|
Gujarat |
Capital Goods |
Debit: Ledger grouped under Current Assets. Credit: VAT ledger. Credit: Additional tax ledger. |
|
Fuels Used in Manufacture of Goods |
Debit: Purchase ledger. Credit: VAT ledger. Credit: Additional tax ledger. |
|
|
Manufactured Goods |
Debit: Purchase ledger. Credit: VAT ledger. Credit: Additional tax ledger. |
|
|
Manufacturing of Exempt Goods |
Debit: Purchase ledger. Credit: VAT ledger. Credit: Additional tax ledger. |
|
|
Others |
Debit: Purchase ledger. Credit: VAT ledger. Credit: Additional tax ledger. |
|
|
Stock Transfer |
Debit: Purchase ledger. Credit: VAT ledger. Credit: Additional tax ledger. |
|
|
Purchases Not Qualifying for Tax Credit |
Debit: Purchase ledger. Credit: VAT ledger. Credit: Additional tax ledger. |
|
|
Tax Adjustments Towards Transfer of Right to Use |
Debit: Expense/purchase ledger. Credit: Purchase ledger. Credit: VAT ledger. Credit: Additional tax ledger. |
|
|
Haryana |
Capital goods forming part of gross block on day of registration cancellation |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
Capital goods used in generation & distribution of electricity |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Capital goods used in manufacture of exempted goods |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Capital goods used in mining |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Capital goods used in telecommunication network |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Haryana |
Fuels Used in Manufacture of Goods |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
Goods are used for manufacturing and sold in interstate trade or commerce |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Goods purchased – Exported out of state |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Goods Sold Below Purchase Price |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Interstate Sales |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Liquor when sold in the state by Bar Licensees |
Debit: Expense/purchase ledger. Credit: VAT ledger. Credit: Surcharge ledger. |
|
|
Haryana |