How to record reverse credit for Orissa enabled vat Company

you might be aware of my article vat and excise entry in tally and how tocreate an item ledger with vat and excise

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Though tally.erp 9 does not adjust your input and output and you have to record the same through a journal entry and before doing so, you must create a vat adjustment voucher class.

Here, I will discuss about vat adjustment and reverse credit for Orissa Enabled vat company

Go to Gateway of Tally > Accounting Vouchers > F7: Journals > Select the voucher class created for VAT Adjustment from the Voucher Class List

(1) Reversal Input Tax Credit on Transfer

Select Reversal Input Tax Credit on Transfer in the Used for field

Debit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(2) Reversal Input Tax Credit on Interstate Sales

Select Reversal Input Tax Credit on Interstate Sales in the Used for field

Debit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(3) Reverse Credit on Goods Sold Other than Interstate Sales

Select Reverse Credit on Goods Sold Other than Interstate Sales in the Used for field

Debit: Indirect Expenses ledger (grouped under Indirect Expenses)

Credit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(4) Reverse Credit on Goods Damaged/Lost

Select Reverse Credit on Goods Damaged/Lost in the Used for field

Debit: Indirect Expenses ledger (grouped under Indirect Expenses)

Credit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(5) Reversal of ITC on Apportionment for Manufacturing of Exempt Goods

Select Reversal of ITC on Apportionment for Manufacturing of Exempt Goods in the Used for field

Debit: Indirect Expenses ledger (grouped under Indirect Expenses)

Credit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(6) Reverse Credit – on Exempt Goods

Select Reverse Credit – on Exempt Goods in the Used for field

Debit: Indirect Expenses ledger (grouped under Indirect Expenses)

Credit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(7) Reverse Input Tax Credit on Mining and Electricity

Select Reverse Input Tax Credit on Mining and Electricity in the Used for field

Debit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(8) Reverse Credit on Goods Unsold at the Time of Business Closure

Select Reverse Credit on Goods Unsold at the Time of Business Closure in the Used for field

Debit: Indirect Expenses ledger (grouped under Indirect Expenses)

Credit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(9) Reverse Credit – On Switch Over Option

Select Reverse Credit – On Switch Over Option in the Used for field

Debit: Indirect Expenses (grouped under Indirect Expenses)

Credit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(10) Reverse Credit On Goods Unsold as Per Section 16

Select Reverse Credit On Goods Unsold as Per Section 16 in the Used for field

Debit: Indirect Expenses ledger (grouped under Indirect Expenses)

Credit: Purchase ledger (grouped under Purchase Accounts with VAT/ Tax ClassPurchases @ 1%, Purchases @ 4% and Purchases @ 12.5%)

Credit: Input VAT ledger (grouped under Duties & Taxes with Type of Duty/Tax as VAT and VAT/Tax Class – Input VAT @ 1%, Input VAT @ 4% and Input VAT @ 12.5%)

(11) Reverse Credit on Others

Select Reverse Credit on Others in the Used for field

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One thought on “How to record reverse credit for Orissa enabled vat Company

  1. please answer the following question

    in a.p state vat amount was increased upto @ 5% from sep’2011 how to follow VatTax/Class in system created 1%,4%,12.5% and exempted how to add 5% in VatTax/Class during sales or purchase entry