How to Enable GST in Tally [Detailed Guide]

The Goods and Services Tax (GST) was implemented in India in 2017. Except for a few goods and services, the GST has been implemented across the country, to streamline and make the taxation process easier and convenient for businesses.

The definition of GST varies among stakeholders. For instance, businesses that are registered as regular dealers and have a turnover of more than Rs. 1.5 crores, need to file their GSTR-1 (GST Return) every month. On the other hand, businesses with an aggregated turnover of less than Rs. 1.5 crores, need to file their GSTR-1 once every quarter. Lastly, composite dealers are required to file a GSTR-4 every quarter. Furthermore, businesses may be expected to comply with the e-Way Bill, which is levied on the interstate and intrastate movement of goods worth Rs. 50,000.

Sounds complicated? With the right accounting software, businesses no longer need to worry about the hassles involved in calculating the GST they need to pay. Since Tally is one of the most popular and reliable accounting software used by businesses across India, here, we will discuss how to enable GST in Tally.

A Step-by-Step Guide to Enabling GST in Tally

As a business owner, you can be assured of a hassle-free experience with Tally, in terms of the calculation of GST. If you are using Tally ERP 9, you can easily generate and record invoices and transactions as per the GST format. Tally ERP 9 also makes sure that a business’ GST returns match with its books of accounts and that they display the same data that was used for the filing of returns on the GST portal.

Proprietors can easily file and share their GST returns with their tax consultants using the GST format. They can also file the GSTR-1, GSTR-3B, and GSTR-4 either by using the Excel Offline Utility Tool or with the JSON format as per the GST portal. Moreover, Tally ensures that your GST filings are as per your financial statements, and can easily share the changes made in your return statements by marking them.

Now let’s look at how to integrate GST in Tally:

• Step 1: From the Gateway of Tally (main area), go to ‘Features’ by pressing the F11 key. The ‘Company Features’ menu will then appear on your screen.
• Step 2: Once the ‘Company Features’ menu appears, click on the ‘Statutory and Taxation’ option. Upon clicking the option, you will then see another screen, which is known as the ‘Company Operations Alteration’.
• Step 3: After the ‘Company Operations Alteration’ screen appears, there will be two options – Enable Goods and Services Tax (GST) and Set/Alter GST details.
• Step 4: Click on the ‘Enable Goods and Services Tax (GST)’ option. This can be done by clicking on ‘Y’, followed by pressing the Enter key. You have now enabled the GST option in Tally.

In case you want to alter or make any changes to the GST details in Tally, you can follow these steps:

• Step 1: Ensure that you have all the required details, including a valid GST Identification Number (GSTIN), GST rates, and an HSN (Harmonised System Nomenclature) code. The HSN code varies as per the products or services your business deals in.
• Step 2: After you have enabled GST on Tally, a ‘Company Operations Alteration’ screen will appear. Press ‘Y’ against the Set/Alter GST details option, followed by the Enter key.
• Step 3: Once the Enter key has been pressed, the ‘Company GST Details’ screen will appear. Start by selecting the state from the ‘State’ option, where your business is situated.
• Step 4: Upon selecting the state your business is located in, the second option is ‘Registration’. Click on the ‘Regular’ choice for registration.
• Step 5: Under the ‘Registration’ option, enter the GSTIN or UIN number. This should be followed by entering the applicable date, which would be anytime after 1 July 2017.
• Step 6: Once you have entered the registration details, click on the ‘Set/Alter’ option. Here, you will be entering the GST rates levied on the goods and services that your business sells. Press the ‘Y’ and Enter keys to do so.
• Step 7: Upon entering the details regarding the GST rates, you will also be asked to provide information such as product description, HSN number, and tax details. Under ‘Tax Details’, there will be three options, namely, Exempt, Nil Rated, and Taxable. Choose the ‘Taxable’ option, followed by ‘Integrated Tax’ under ‘Tax Type’.
• Step 8: You can choose to enable the Central and State Tax option, as well as the cess percentage, if applicable to the products and services you are selling.

Important Things to Keep in Mind

While the process of enabling GST in Tally is the same across all businesses, during registration, additional fields may appear for certain states and union territories, depending upon their statutory requirements. Let’s have a look at some of them:

• Kerala – The Kerala Flood Cess might be applicable in some circumstances, starting from Release 6.5.3 and later versions.
• Ladakh – If your business is located in Ladakh, you need to register it under the GST number provided for the Union Territory of Ladakh in the GSTIN/UIN field.
• Jammu and Kashmir – Although not necessarily needed, If you are a business dealer located in Jammu and Kashmir and are required to get a new GST registration, you need to mention the new GST number under the GSTIN/UIN field.
• Dadra and Nagar Haveli and Daman and Diu – The name of the new union territory of Dadra and Nagar Haveli and Daman and Diu has been incorporated under Release 6.6.3, and your business needs to be manually updated with the new GSTIN/UIN.

Conclusion

We have now learned how to enable GST in Tally. While the process may appear complicated, it saves a lot of hassles and paperwork for businesses, which do not have to spend several hours trying to understand how to file their tax returns under the GST rule. With Tally, businesses can automatically calculate their Central and State GST as and when transactions are recorded. So, businesses must enable GST in their Tally software as soon as possible, to ensure smoother and convenient operations.

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FAQs

Q. What is meant by Form GSTR-3B? How should I file it?

Ans. Form GSTR-3B is an interim return form that GST business dealers need to use for regular registration to file returns for every financial year. Businesses can file the form by either using the Excel Offline Utility Tool option or the JSON format as provided on the GST portal.

Q. If a business operates in multiple states, can it file returns with a single registration?

Ans. No. If a business provides products and services across multiple states, GST will be levied on supply at the location where the goods and services are being provided. There is no single, centralised registration system for the same.

Q. Are VAT and UAM numbers sufficient for GST registration?

Ans. While VAT and UAM numbers can be provided for GST registration, PAN details are a must while registering a business under the GST regime.

Q. Can businesses avail excise duty for goods purchased a year ago?

Ans. No. Businesses can no longer avail of excise duty for products supplied after 1 July 2017, which is when the GST rule came into effect. To claim excise duty paid against a particular invoice, the date on the invoice or any other prescribed duty/tax paying documents must be within 12 months from the date the business transitioned to GST.