If you’re a business that’s working with other businesses from countries around the world, then you will likely run into GST (Goods and Services Tax). This tax is now used in many countries including India, Canada, and Australia. The best way to deal with complicated taxes and invoices is to use software such as Tally. However, some features may not be easy to understand at first. For example, you may want Tally to automatically calculate GST in an invoice. Here’s how to do it so you don’t need to calculate it manually.
What is GST?
For those not familiar with GST yet, it is a tax levied on the sale of goods and services. This is a similar tax to VAT (Value Added Tax) used in the UK and other European countries. Although many countries now use GST, they are applied in different ways depending on the country. For example, India has three types of GST depending on where the goods or service is sold. It’s important if you’re dealing with GST to understand the local laws surrounding its use so that you are not caught out.
Creating a Tally Account
If you’re new to Tally, then the first thing you need to do is create an account and set up your company. Thankfully, this is a fairly straightforward process so it shouldn’t take you too long.
- Firstly, you need to go to the Gateway when you get to the main screen. You then need to press Alt + F3 which will take you to the Create Company screen.
- Enter the information about your company. To ensure you are getting the right information on your invoices and other documents, you should complete your company name, mailing address, and the currency you use. There are additional fields for more details if you wish to complete them.
- You now have the choice to select Accounts Only or Accounts with Inventory. This depends on what you need to see for your company.
- The first day of the current financial year is displayed for default. However, you can manually change it if needed.
- You can now enter your Tally Vault password now if you have one set up.
- Press Y or the Enter key to accept the information you entered and save it.
Enabling the GST Features
Once you have set up your business on Tally, you can move on and enable the GDT features.
- Firstly, you need to go to the gateway of Tally by pressing F11 to get onto features, then F3 to get into Statutory and Taxation.
- You will then be presented with two options:
- Enable goods and service tax (GST): Yes
- Set/Alter GST Details: Yes
- If you choose the Set/Alter option, then you will be able to add the details of the company such as the registered area of the company and the registration number.
- Press the Y or Enter key to accept the information and save it.
To enable you to pass accounting entries, you need to create ledgers. This can be done on the Ledgers page in Accounts Info. Once this is done, you’re all set to start accepting orders and dealing with GST countries. It’s important to keep an eye on the GST rules and laws, as this could change and your accounts may need to be updated.