Gujarat purchase invoice (gvat)

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 December 2012 hello, anyone help me out

my query is when we book entry in tally of purchase bill of gujarat including vat, but in a bill two types vat indicated VAT 4% & Ad.Tax 1%,
so in maharashtra which head i have to make entry 4% or 4+1= 5% or show separate 4% & 1%.

Querist : Anonymous

Querist : Anonymous (Querist)

04 January 2013 can anyone help me

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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27 July 2024 When dealing with purchase invoices that include different types of VAT and additional tax (like Ad. Tax) from Gujarat, and you are booking these entries in Tally or any other accounting software in Maharashtra, it's important to correctly categorize and record the taxes for proper accounting and compliance. Here’s how you should handle this:

### **1. **Understanding the Taxes:**

- **VAT 4%**: This is the standard VAT rate applied on the purchase.
- **Ad. Tax 1%**: This is an additional tax on VAT, which may be specific to certain regions or industries. In Gujarat, this is often known as Additional Tax (Ad. Tax) and is an extra charge on the VAT.

### **2. **Recording the Taxes in Tally:**

In Tally, you should record each type of tax separately to ensure accurate accounting and reporting. Here’s a step-by-step guide on how to make the entry:

**A. **Create Tax Ledgers:**
- **VAT 4% Ledger:** Create a ledger for VAT at 4%.
- **Ad. Tax 1% Ledger:** Create a separate ledger for Ad. Tax at 1%.

**B. **Record the Purchase Entry:**

1. **Purchase Entry:**
- **Go to**: Gateway of Tally > Accounting Vouchers > Purchase.
- **Select**: Purchase Invoice.
- **Enter**: Supplier details, purchase amount, and other details.
- **In the tax details section**, enter the VAT and Ad. Tax as follows:

2. **Tax Details:**
- **VAT 4%:** Enter the VAT amount separately under the VAT 4% ledger.
- **Ad. Tax 1%:** Enter the Additional Tax amount separately under the Ad. Tax ledger.

**Example Entry:**

Assume the purchase amount is ₹10,000 and VAT is 4% and Ad. Tax is 1%.

- **Purchase Amount**: ₹10,000
- **VAT (4%)**: ₹400
- **Ad. Tax (1%)**: ₹100

**In Tally:**

- **Purchase Account**: ₹10,000 (Debit)
- **VAT 4% Account**: ₹400 (Debit)
- **Ad. Tax 1% Account**: ₹100 (Debit)
- **Bank/Cash Account**: ₹10,500 (Credit)

**Detailed Steps:**

1. **Go to Purchase Voucher**: Create a purchase voucher with the purchase amount of ₹10,000.
2. **Add VAT 4%**: Add ₹400 under the VAT 4% ledger.
3. **Add Ad. Tax 1%**: Add ₹100 under the Ad. Tax ledger.
4. **Total Amount**: The total amount payable will be ₹10,500.

### **3. **Reporting:**

When generating reports or filing returns:

- **VAT Reporting**: Ensure that VAT is reported as per the applicable rates and amounts in Gujarat.
- **Ad. Tax Reporting**: Report the Additional Tax separately, as it may need to be shown in specific reports or filings.

### **4. **Compliance with Maharashtra Rules:**

Since you are recording transactions in Maharashtra, you should:

- **Follow Maharashtra VAT Rules:** Ensure that you comply with Maharashtra VAT rules for any inter-state purchase, particularly if claiming any input tax credit (ITC) or adjusting for taxes paid in Gujarat.
- **Check for ITC Eligibility:** Confirm whether the VAT and Ad. Tax paid are eligible for ITC under Maharashtra VAT rules.

### **Summary**

1. **Record Separate Taxes:** Enter VAT and Ad. Tax separately in Tally.
2. **Create Ledgers:** Set up distinct ledgers for VAT 4% and Ad. Tax 1%.
3. **Ensure Accurate Reporting:** Report these taxes according to the applicable tax laws in Gujarat and Maharashtra.

By following these steps, you will maintain accurate records and ensure compliance with the tax regulations.

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