Logo Screen Of Tally

HISTORY OF TALLY
• Tally solutions pvt. ltd. formerly called as “Peutronics
pvt. Ltd.” based in Bangalore and it was started as a
software development organization. Tally was
introduced in the year 1986 by SYAM SHUNDER
GOENKA (founder of tally ) and it was taking care by
BHARAT GOENKA (co-founder and managing
director).
• Peutronics pvt. Ltd. was termed as a tally solutions
pvt. Ltd. in the year 1988.
MEANING OF TALLY.ERP9
• Tally.erp9 is a multilingual business
accounting ,inventory, payroll and
taxation management software.
Advantages of Tally.ERP9
• Time Saving software.
• One time creation of Masters.
• Automated Financial Reports.
• It’s a fastest and multi-lingual software.
• It is easy to buy, quick to install, easy to lean and use.
VERSIONS OF TALLY.ERP.9
• Tally 4.5: This version MS-DOS support financial
accounting system. It takes care of accounting
activities only such as Ledgers Classification Vouchers
Entry. It provides simple financial reports and bill wise
analysis of debtors and creditors in the business.
• Tally 5.0: This version is an upgraded version to tally
4.5 and it works in windows operating system
Inventory modules is introduced in this version, which
involves detailed inventory, structure invoicing and
integrating accounting and Inventory records.
• Tally 5.4: This version is an improved module over the
version 5.0 where it is capable of converting earlier
data formats in to the current data format. This is
possible though “Import of Data” Facility.
• Tally 6.3: This version is extended enterprise systems
whereby it interacts with other system through ODBC
(Open Data Base Connectivity) you and e-mail upload
your financial records form tally.
• Tally 7.2: This version is an integrated enterprise
system provides different kind of taxes like VAT, TDS &
TCS and Service Tax modules is introduced in this
version.
• Tally 8.1: This version is multi language support
software. It supports 10 Languages includes is
introduced in this version.
• Tally 9.0: This version is an improved model over the
version 8.1. It supports 13 Languages (Includes Foreign
Languages). Payroll, POS (Point of Sales) modules is
introduced in this version.
• Tally.ERP9: This is the latest version which provides
different features like remote access, much powerful
data security, tally.net and many more. ERP stands for
enterprise resource planning/program.
• The latest release in .erp9 is tally.erp9 series A release
6.5.1
Download Tally.ERP9 from web
• Open Any Browsing Software, ex:-Internet explorer
>>> type the address as www.tallysolutions.com>> go
to download >> select Tally.ERP9 >> Scroll Down>>
you will see 2 buttons “Install now” and “Download
For Later”>>click Any one option to download>> It
downloads setup.exe application File
>>>Install the setup.exe in your computer>> click
finally “Done” Button to complete Installation.
How to Update Tally.ERP9
• Right click on the Tally.ERP9 icon on your desktop >>properties
>>open file location >>setup.exe >> double click on setup.exe and
click on “upgrade” >> finally click on done.
How to uninstall Tally.ERP9
• Right click on the Tally.ERP9 icon on your desktop >>properties
>>open file location >>setup.exe >> double click on setup.exe and
click on “uninstall” >> finally click on done.
How to open Tally.ERP9
• Start>> All programs>>select Tally.ERP9
folder>>Tally.ERP9 icon >> in start up screen
select “Alt+W-work in education mode”.
Or
• Double click on the Tally.ERP9 icon in
desktop >> in start up screen select “Alt+W-work
in education mode”.
Screen components of
Tally.ERP9
 Title Bar

Horizontal
button bar Close
Calculator

Screen Name
Main Area

Buttons Tool
Bar

Open
Task Bar Calculator
Calculator
Info Panel
Panel
Mouse/Keyboard Conventions
ACTION PARTICULARS
Fn Press the Function Key

Fn Press ALT+ Function Key

Fn Press Ctrl+Function Key

Company creation
•Procedure:- Gateway of Tally>company
info.>create company > provide the details
like name of company, mailing and contact
details, financial year etc… Ctrl+A to accept.
Alter the company
• Gate way of tally >> Alt+f3 (company info.) >> alter >> select company
>> change the required details >>Ctrl+A (accept).
Delete company
• Gate way of tally >> Alt+f3 (company info.) >> alter >> select company
>> press (Alt+D) to delete >> press ‘Y’ to accept.
Shortcut keys used in Gate Way of tally
• F1-select company
• F2-change date
• F3-switch company between selected company
• F4-connect company
• Alt+F1-Shut company
• Alt+F2-change period
• Alt+F3-Company Info
• Alt+F4-Disconnect company
• F12-Configuration
• F11-Featurs
How to activate accounts only company in
Tally.ERP9 Rel 5.0
• Gate way of tally >>F11 company features >>> F1 accounting Feature
>> enable “ Maintain Accounts Only”=yes>> Ctrl+A (Accept)
Company features
• After creating a company with the
required information, you can now
enable/modify accounting, inventory and
statutory & taxation features and
configuration
• Company features:-GOT>f11
• Configurations:-GOT>f 12
1. Accounting features
Accounting features consists of configurations, which generally affects
accounting transactions and reports.
• General.
• Outstanding management.
• Cost/profit centers management.
• Invoicing.
• Budgets/ scenario management.
• Banking features.
• Other features.
2. Inventory features
Inventory features consists of configurations, which generally affects
inventory transactions and reports.
• General.
• Storage and classification.
• Order processing.
• Invoicing.
• Purchase management.
• Sales management.
• Other features.
3) Statutory and taxation features

• Statutory and taxation features consists of

configurations, which generally affects the statutory
and taxation transactions and reports.
• It includes Excise, VAT, Service tax, TDS, TCS etc..
F12 configuration
List Of Accounts Info
• Groups
• Ledger
• Currency
• Voucher Types
 currency
• Currency is a symbol, which is used to
specify the worthiness of a product. by
default tally creates one currency i.e.; Rs
which can be altered but can not be
deleted.
• How to enable currencies
GOT>>f11 (company features) >>f1 accounting features >>
general features >> allow multi currency =yes >> ctrl+a
(accept).
How to create currencies
• Gateway> account info.>currencies>create.
How to display currencies
• Gateway> account info.>currencies>display>select the
currency.
How to alter currencies
Gateway> account info.>currencies>alter>select currency.
How to delete currencies
• Gateway> account info.>currencies>alter>select currency to
delete>Alt+D (Delete).
 Country symbol Formal ASCII
name Value
United Kingdom £ Pound ALT+156

Japan ¥ Yen ALT+157

Europe € Euro ALT+0128
United states $ US Dollars Shift+4/ALT
+36
India Rs. Indian Ctrl+4
rupees
(INR)
groups
• They are also refered as schedules by default tally creates all types of
groups in built there are 28 groups out of which 15 are primary and
13 are sub groups.
• Procedure
• Gateway> account info.>groups
Creation of groups
• GOT >> Accounts info >> single group >> create
• 1. Name:- share capital
• Under:- capital account
• Crtl+A Accept.
• 2. Name:- Outstanding Expenses
• Under:- Current liability
• Ctrl+A Accept.
How to view Statistics
• GOT>>Display>> Statement of Accounts >> Statistics
Assignment for groups
• 1. write all 28 groups and explain in 2 lines.
• 2. write the format of balance sheet and trading and profit and loss
a/c.
ledgers
• They are also referred as head of accounts by default tally creates 2
ledger. One cash account and profit and loss account.
• The default ledger can be altered but cannot be deleted. Ledgers are
used to record day transaction.
• Procedure
• Gateway>account info.> ledgers>create>
List of ledgers
Sl.no Name of ledger Under group Opening balance
.
1 Purchase a/c Purchase Account 40000
2 Sales a/c Sales Accounts 100000
3 Furniture A/c Fixed Assets 500000
4 Canara bank a/c Bank Account 200000
5 Mr ravis capital a/c Capital Account 650490
6 Drawings A/c Capital Account 50000
7 Salary Indirect expenses 56000
8 Stationary a/c Indirect expenses 5000
9 Depreciation A/c Indirect expenses 500
10 Appreciation A/c Indirect incomes 360
11 Interest received Indirect Incomes 650
12 cash Cash-in-hand 500000
13 reserves Reserves & surplus 500000
vouchers

•It is a proof that particular transaction has

taken place for the value stated their in on a
particular date. It is used to pass day to day
transaction.
Voucher type
• In tally default 22 voucher type is present and if you enabled the
payroll 2 voucher will enabled and total 24 voucher types present in
tally.
Accounting voucher
Accounting voucher used to
recorded all accounting transaction
in tally.erp9.
•Contra voucher (F4)
•Payment voucher (F5)
•Receipt voucher (F6)
•journal voucher (F7)
Contra voucher (F4)
• It is called as banking voucher. It is used to record all
the transaction related to bank. In this particular
credit comes first and next debit.
• Syntax:
• cr: cash/bank
• dr: cash/bank
The main transaction recorded in this voucher type are:-
• Deposit of cash to bank
• Withdraw of cash from bank
• Transfer of cash from one bank to another.
Procedure-
• Gateway>transactions>accounting voucher>contra voucher.
Steps
• Step1:F2 date
• Step2:pass entries
• Step3:give narration
• Step4:save it.
• accept:yes
• Contra entry can pass in single and double entry modes.
Contra transactions
• On 1st April 2019, deposited cash rs.20000 to Canara bank a/c.
• On 1st April 2019, deposited cash rs. 20000 to ICICI bank and rs.30000
to Indian bank.
• On 2nd April 2019, withdraw cash rs. 5000 from Canara bank by
Cheque
• On 1st may 2019,withdraw cash rs 10000 from Indian bank and
rs.5000 from ICICI bank by Cheque
• On 2nd may 2019, transferred cash rs.10000 from Canara bank to
HDFC bank.
How to convert single entry mode to double
entry mode
• In voucher screen press F12 (Configuration) >>> disable “use single
entry mode payment/ receipt/ contra”=no >> ctrl+A accept
How to move cursor to date field during entry
• Press f12 Configuration from the voucher screen >>
Disable “Skip date field during faster entry”=No>>
Ctrl+A accept.
How to set cheque book
• GOT>> accounts info>> ledger>> alter >> select bank ledger
• Ex:- name:CANARA bank a/c
• Under : bank a/c
• Set/alter cheque books=yes

• Ctrl+A accept.
How to configure cheque printing
• GOT>> accounts info>> ledger>> alter >> select bank ledger
• Ex:- name:CANARA bank a/c
• Under : bank a/c
• Set/alter cheque printing configuration=yes
• Ctrl+C (Copy from) >>> select sample format >>>
• Ctrl+A accept >>> escape from preview >>ctrl+A accept
Contra voucher
1. Deposit of cash of rs.2000 to icici bank on 2nd oct
2019.
2. 1st july 2019,With draw of cash Rs.2000 from hdfc
bank.
3. 2nd july 2019bTransfer of cash Rs.2000 from icici
bank to hdfc bank.
4. On 1st sep 2019 Deposit of cash Rs.10000 equally to
icici bank and syndicate bank.
5. On 2nd sep 2019 Withdraw of cash Rs.10000 each
from canara bank and hdfc bank.
Day book
• It is also called as primary book .It is legally valid
document.
• Day Book is used to record day to day transactions in
a systematic manner.
• Day Book cannot be used to analyze the data of the
company.
• Day Book cannot be used to generate any kind of
reports.
• It is used to view the list of entries.
• Procedure
• Gate way >display>day book
• F2:date
• Alt+F2:period
• Alt+d: to delete entries
• Alt+F1:detailed reports
• Alt +R:to remove line(to hide entries)
• Alt+u:to restore line.
• Alt+x:to cancel the entries.
Payment voucher
• All payables either by cash or bank should be recorded in this
voucher .In this particular debit comes first and next the
credit.
• Syntax : dr :expenses/purchase of fixed assets/purchase of
shares/duties and taxes / sy.crs.
cr:cash/bank.
Payment voucher
• The main transaction recorded in this voucher are:
• Payment of expenses: rent paid, salary paid etc…..
• Purchase of fixed assets: furniture, land and building.
• Purchase of shares: shares in Wipro ,shares in
reliance.
• Payment of taxes in the form of cash.
• Procedure:-
GOT>>accounting voucher >> F5 (payment voucher).
Steps
• Step1:F2 date
• Step2:pass entries
• Step3:give narration
• Step4:save it.
accept: yes
payment
• On 1st April 2019, paid rent worth rs. 30000 by cash
• On 2nd april 2019, paid stationary purchased by cash rs 5000
• On 1st may 2019, paid advertisement expenses rs 23000 by the
cheque of canara bank
• On 1st June 2019, paid electricity charges, water charges, telephone
charges worth rs. 2300, rs 1200 and rs.1000 respectively by cash
• Paid advance on 1st sep 2019 to mr guru(supplier) worth rs 20000 by
cash
Payment voucher
• On 1 sep 2019 Paid rent worth rs.20000
st

and commission Rs.2000 by cash

• On 1st sep 2019 Purchased furniture
worth rs.20000 paying half by cash and
half by karnataka bank.
• On 2nd sep 2019 Purchase of shares in
Wipro Rs.5000 by cash and computer
Rs.20000 by indian bank
• On 1st oct 2019 Paid advance Rs.2000 to
mn traders (supplier) by cash.
Receipt voucher
• All receivable in the form of cash or bank will be recorded in this
voucher .in this particular credit comes first and debit comes next.
• Syntax: cr: incomes/sales of fixed assets/ sales of shares/capital/sy .dr
dr: cash/bank.
Receipt voucher
• The main transaction recorded in this voucher are:
• Income received :rent received, commission received,
interest received.
• Sales of fixed assets :furniture ,land and building.
• Sales of shares: share in Wipro.

• PROCEDURE
• Gate way>transactions>a/c voucher>receipt
voucher(F6)
Steps
• Step1:F2 date
• Step2:pass entries
• Step3:give narration
• Step4:save it.
accept: yes
Receipt voucher
• On 1st April 2019 mr Ravi commenced business worth rs 500000 cash
to his business
• On 2nd april 2019 received interest worth rs 200 by canara bank
• On 1st may 2019, received advance from mr raju-customer worth
rs.15000.
Receipt voucher
• On 1st april 2019 Received rent and commission rs. 10000 equally
• On 2nd july 2019 Sold furniture for Rs.8000 received 2000 by cash and
remaining by cheques.
• On 1st april 2019 Rupees 10000 introduced by Mr.prakash to the
business.
• Received interest rupees 2000 on 2nd of every month..(create
duplicate transactions for 5 months)
 Bill Wise Details
• The bill-wise details in Tally.ERP9 enables tracking of
transactions and efficient management of payables
and receivables. once transactions are recorded in
Tally.ERP9, reports can be generated instantaneously.
This feature, helps in tracking outstanding bills and in
sending remainders on time to customers, thus
managing outstanding efficiently.
• In Tally.ERP9, 4 types of reference details can be
entered for transactions. These reference details,
called ‘methods of adjustments’. They are:- New Ref,
Agst Ref, Advance and On account.
Activate bill-wise in Tally.ERP9
• GOT>> F11 company feature >> F1 accounting feature
>> “maintain bill wise details “=yes >>> ctrl+A accept.
• HOW TO ENABLE BILL WISE IN PARTY LEDGER
• Note:-Bill-wise applicable for sundry debtors and
sundry creditors.
• GOT>> Accounts info >> ledger >> single ledger >>
create.
• Name:-mr x
• Under :- sundry debtors
• Maintain balance bill by bill=yes
• Default credit period=30days
• Ctrl+A accept.
Type of Bill References (method of
adjustment)
• New Ref
• Agst Ref
• Advance
• On account
Bill-wise report
• GOT >>> Display >> Statement of Accounts >> Outstanding >> Bills
Payables/Bills Receivables.
Journal voucher(F7)
• It is also called as an adjustment voucher. It is used to
record all types of a/c transactions which does not
involve cash ,bank, purchases and sales ledger. in this
particular debit comes first and credit comes next.
Syntax : d r: any ledger.
c r: any ledger.
The main transaction recorded in this voucher are:
• Deprecation of fixed assets
• Appreciation of fixed assets
• Bill of exchange
• Transfer of cash from 1 account to another.
• Outstanding bills receivable or payable without cash,
without bank.
• Procedure:
• Gateway>transaction>account voucher>journal
voucher (F7)
Steps
• Step1:F2 date
• Step2:pass entries
• Step3:give narration
• Step4:save it.
accept: yes
Journal voucher

• On 31-12-2019 Depreciate furniture by 2 % whose

book value is 20000.
• On 31-12-2019 Appreciate land and building by 3%
whose book value is 50000
Journal voucher report
• GOT>> Display >> Accounts Book >> Journal Registor
Purchase voucher (F9)
• All inward supply of goods and services and calculation of GST should be
recorded in this voucher. Only 3 types of purchase should be recorded in
this voucher namely
• Cash purchase
• Bank purchase
• Credit purchase
• Procedure:Gateway> transaction> accounting voucher> purchase
voucher(F9)
• Syntax:-Cr:-cash/bank/sundry creditors
• Dr:-purchase a/c
Purchase Transactions
1. On 1st April 2019, Purchased goods worth Rs. 25,000 by cash.
2. On 2nd May 2019, Purchased machinery worth rs. 15000 by the
cheque of Indian bank.
3. On 1st july 2019,Purchased goods from Ashirvadh Traders,
Karnataka worth rs. 43,000 for 30 days credit period and paid the
pending on 31st july 2019 as full settlement by cash.
How to enable fixed assets and expenses in
purchase voucher.
• From the purchase voucher screen >> F12 configuration (twice) >>
enable “Allow expenses/fixed assets in purchase voucher”=yes >>
Ctrl+A accept (Twice).
How to view pending bills payable report
• GOT >> display >> statement of accounts >> outstanding
>> Payables.
Sales voucher (F8)
• All outward supply of goods and services and calculation of GST
should be recorded in this voucher. Only 3 types of sales should be
recorded in this voucher namely
• Cash sale
• Bank sale
• Credit sale
• Procedure:Gateway> transaction> accounting voucher> sales
voucher(F8)
• Syntax:-Dr:-cash/bank/Sundry debtors
Cr:- sales a/c
Sales transactions
• 1. on 1st april 2018 sold goods worth rs. 12000 by cash.
• 2. on 2nd may 2018, sold furniture worth rs. 23000 by the cheque of
canara bank a/c
• 3. on 1st August 2018 sold goods worth rs 30000 to mr Rahim,
Karnataka for 30 days credit period. And received half by the cheque
of canara bank and half by cash on 31st august 2018
 Journalize transactions in the books of TIM
enterprises for the year 2019.
Date Transactions
1/4/2018 Business started with Cash Rs. 5,00,000
1/5/2018 Goods Purchased from Mohan Rs. 40,000
1/6/2018 Stationery Purchased for cash Rs. 2,000
2/4/2018 Opening a bank account with UTI bank by depositing cash of Rs.
50,000.

2/6/2018 Goods sold to Riya for Rs.25,000

2/7/2018 Received a cheque of Rs.25,000 from Riya
1/8/2018 Sold goods to shrinidhi Rs.12,000.
How to activate inventory in Tally.ERP9
• Gate way of tally> F11 company feature >> F1 accounting feature >>
disable“ maintain accounts only” =no >>Ctrl+A accept.
 Inventory info
• Stock groups
• Stock category
• Stock item
• Unit of measure
• Godown
• Voucher type
Godowns
• It is the place where we store the inventory. by default
tally creates 1 godown called main locations.

• PROCEDURE
• Gate way>inventory info> godowns >create.
How to activate godown in tally
• GOT>>> F11 company features >>> F2 inventory
feature >>>> enable “maintain multiple
godown”=yes>>>> ctrl +A to accept.
• Ex:- Name : bangalore location
under: primary
Units of measure
• Units is a symbol which is used to measure the
quantity of stock items.
• There are two types of units
• Simple unit
• Ex: Kgs, Ltrs, Gms, Nos, Dz, Bx, Bg.
• Compound unit: it is used to equate two simple
compounds ex: 1Dz = 12 nos
1bx = 10 nos
1Kg = 1000 Gms
• PROCEDURE
• Gate way>inventory info>units of measure>create.
Stock category
• It enables easy location and identification of
stock item in the statement.
• procedure:
• Gateway> inventory info> stock categories>
create
How to activate stock category in tally
• GOT>>> F11 company features >>> F2 inventory feature >>>> enable
“maintain stock category “=yes>>> ctrl+A (accept).
Stock group
• Stock items can be grouped together under stock groups. It
enables easy location and identification of stock items in the
statement hence items of particular brand can be extracted
easily.
• Procedure:
• Gateway> inventory info> stock group> create.
 Stock item
•The finished product ready for sale, which is
not yet been sold is called as stock.
•Procedure:-
GOT >inventory info >stock item > create.
List of stock items
Stock category Stock group Stock items Unit of measure
Liquid fuel Petrol, diesel, Ltrs
kerosene etc….
fuels
Solid fuel Char coal, camphor kgs
etc…
Note book Classmate, Nos
chandras ect…
Stationary
Pens Cello, parker, Nos
Reynolds
electronics Computer Dell , HP, Lenovo nos
etc..
Purchase transaction in item mode
• 1. On 1st July 2019, purchase 10 nos of HP computer @ 23,000/no and
20 nos of lazer printer @ 12,000/nos from mr ravi supplier with 30
days credit period. On 31st July 2019 settled the full bill by cash.
• On 1st July 2019 purchased 50 numbers of Samsung Mobile @
12,450/no from MR. karthik (supplier),karnataka, for 30 days credit
period. On 2nd july 2019 rejected 5 nos of Samsung Mobile and
remaining settled the bill on 1st august 2019.
• It Includes: - 2% discount, 5% package charges.
• Steps:1:- activation of discount column in invoice
GOT >> F11 company features >> f2 inventory features >>enable “ allow separate
discount column in invoice”=yes >> ctrl +A
Step:2:- creation of ledgers
1. Name:-mr karthik
Under: sundry creditors
Maintain balance bill-by-bill=yes
Default credit period=30 days
• 2. name:- package charges
under:- direct expenses
Step3:-Activate debit note:-
Debit note is a purchase return. When the goods rejected from the
customer, in customer books of accounts record debit note.
Procedure:-GOT >> F11 company features >> F2 inventory feature >> “use
debit/credit note”=yes >> record credit note in invoice mode=yes >> record
debit note in invoice mode=yes >> ctrl+A accept.
Step4:- creation of debit note (Ctrl+F9)
GOT>> Inventory voucher >> Debit note (Ctrl+F9)
Sales voucher
• On 1st may 2019 sold 50 nos of LG washing machine @ 15,000/nos to
ravi enterprises, Karnataka. With 2% package charges and 5%
discount. On 2nd may 2018 rejected 5 nos of washing machine due to
bad condition. And on 31st may 2019 received the remaining amount
by cash.
Stock journal voucher(alt+F7)
• It is called has the manufacturing voucher. It is used to transfer the
stock item, from 1 godown to another godown.
• PROCEDURE
• Gate way>transaction>inventory voucher>stock journal voucher.
• On 1st dec 2019 transferred the materials 100 no’s of silk sarees @ rs.
1200/no’s from Bangalore location to Chennai location.
Stock journal report
• Gate way of tally>>> Display>> Inventory books>>>stock trasfer.
Physical stock voucher
• It is used to over write the book quantity
with the godown quantity.
• Procedure:- Gate way>transaction>inventory
voucher>physical stock voucher(alt+F10)
• On 1st dec 2019 verified the godown and recorded the
transaction
• Name Book Qty Godown Qty rate
• Petrol 1000 998 67
• On 31st may 2019 verified the godown and removed the expired
product from the stock.
Name of item Book qty Godown qty rate
D-cold 2000 1720 5/no
crocin 1500 1450 1/no

Batch no.:- B\12 mfg date:- 1-4-2016 expiry date:-1-4-2019

Physical stock report
• Gate way of tally>> display>>> inventory books>>> physical stock
register
Agenda
• Activate GST for A company
• Maintain GST registration details for the company
• Transfer input credit.
• Record GST registration details of parties
• Record the following transactions:
• Intrastate supplies-Inward
• Intrastate supplies-outward
• Interstate supplies-Inward
• Interstate supplies-outward
• Print GST invoice
• Record Goods return
• Defining tax rates at different level
• Generate GSTR-1 and GSTR-2 reports
• Input credit set off
• Record GST tax payment
• Exporting GSTR1 return
Agenda
• Configure Tax Deducted at Source in Tally.ERP9
• Record simple TDS transactions.
TDS
• TDS means Tax Deducted at Source. The concept of TDS was
introduced in the Income Tax Act, 1961, with the objective of
deducting the tax on an income, at the source of income. It is one of
the methods of collecting Income Tax, which ensures regular flow of
revenue to the Government.
What is TAN?
• TAN is the Tax Deduction & Collection Account Number issued by the
income tax department to all persons deducting tax at source. TAX as
to be quoted in all relevant challans, tax deduction certificates, TDS
returns and other notified documents. To obtain TAN, the person or
organization is required to apply in Form 49B to the TAN Facilitation
centers of NSDL.
Who has to deduct the TDS?
• Any person making the payments to third parties as specified in the
Income tax act of TDS section are required to deduct Tax at source.
Who is a deductee?
• A deductee is a third party that provides services and bills to the
buyer(deductor) and the buyer will then deduct the tax at source at a
prescribed rate, before paying the bill amount.
• Deductees may belong to any of the following categories:
1. Individual
2. Hindu Undivided Family (HUF)
3. Body of Individual (BOI)
4. Association of persons(AOP)
5. Co-operative society
6. Local authority
7. Partnership firm
8. Domestic company (Indian company)
9. Foreign company
10. Artificial judicial person
TDS(tax deducted at source)
• It is an indirect method of collecting income tax when income arises.
• The buyer( deductor ) deducts the tax from the payment made to the
seller (deductive)and remits the tax to the income tax department
with in the stipulated time.
• The nature of payment on which TDS is applicable
• Salary, rent,commission,lotery tickets.etc…
 Nature of Payment
Section Section and Nature of Payment TDS Rate for Individual/ HUF TDS Rate for
(Indian Resident) Non Residents
in India
Section 192 Salaries Average rates as applicable Average rates
as applicable
194I Rent on plant and machinery 2% NA
194I •Rent on land, building, houses, offices, flats, residential •10% in case of payment by NA
apartments, furniture and fittings Plant and machinery companies in excess of Rs.
•Land or building or furniture or fittings 200,000 per annum
•5% - From 1st June 2017, in
case of payment by individuals,
HUF and businessmen in excess
of Rs. 50,000 per month

193 Interest on Securities 10% NA

194 Dividends 10% NA
194A Interest other than "Interest on securities" 10% NA
194B Interest by way of winning from lotteries, crossword puzzles, 30% 30%
games etc.
194BB Income by way of winning from horse race 30% 30%
194C Payment to contractor/ subcontractor 1% NA

194D Insurance Commission 5% NA

194DA Payment in respect of life insurance policy 1% NA

194E Payment to non- resident sports association NA 20%

194EE Payment in respect of deposits under National Savings Scheme 10% 10%

194F Payment on account of repurchase of unit by Mutual Fund or Unit Trust of India 20% 20%

194G Commission etc. on sale of lottery 5% 5%

194H Commission or brokerage 5% NA

194I A Payment on transfer of certain immovable property other than agricultural land 1% NA

194J Sum paid by way of fees for Professional Services 10% NA

194LA Payment of compensation on acquisition of certain immovable property 10% NA

194LB Payment of interest on infrastructure debt fund NA 5%

How to activate TDS
• GOT>> F11 company feature >>F3 statutory and
taxation feature>>enable Tax Deducted at source=yes
>> Set/Alter TDS Details=yes >>
TAN no. :ASDF12345A
deductor type: company
deductor branch/division: enter branch name
set/alter details of person responsible =yes (provide the
deductor details)
rate of TDS if PAN not applicable=20%
Ignore IT exemption limit=no
Activate TDS for Stock items=no
Ctrl+A to Accept.
transaction
• On 1st dec 2019, booked an commission expenses for rs.20000 and
paid to mr xyz with 5% TDS rate.
• Step1:- creation of statutory master:- GOT >>accounts info >>
statutory info >> TDS nature of payment >> create>>
• Step2:- creation of Ledgers:- GOT>> Accounts info >>
single ledger >> create.
1. Name:-mr XYZ
Under:- sundry creditors
Is TDS deductible=yes
deductee type:- company resident
2. Name: commission a/c
Under :indirect expenses
Is TDS applicable=applicable
Nature of payment: commission
3. Name: TDS on Commission
Under:-duties and taxes
Type of duty/tax:- TDS
Nature of goods: commission
• Step3:- TDS transactions
• 1. Journal voucher
• 2. Payment to Mr.XYZ
• 3.Stat TDS payment to government
• :- GOT>> Accounting voucher >> F5 payment voucher >>
Alt+S stat Payment >>
• Tax type:- TDS
• From:1/12/2019 to: 31/12/2019
• Deducted till date:31/12/2019
• Section : 194h
• Nature of payment :Commission
• Deductee type :company
• Residensual status: resident
• Cash/bank:-canara bank
How to print TDS Challan Form –ITNS281
GOT >> Display >> Statutory report >> TDS report >>Form 26Q >> select
payment >> click included transactions >> open payment voucher >>
alt+p (Print)>>enable “print TDS challan”=yes.
TDS report
• GOT >> display >>Statutory report >> TDS report >> Form 26Q
Web sites to refer
• https://www.myloancare.in/tax/tax-deducted-at-source-tds/