HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

Managing HSN Codes/SAC and Tax Rates

You can specify HSN code/SAC details and tax rates at different levels for the goods or service provided by your business. This is a flexibility provided for ease of use to accommodate your business needs. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

It is recommended that HSN code/SAC and tax rate should be specified at the same level. In case you have specified these at different levels, you can remove it.can remove it . If HSN code/SAC and tax rate are specified at stock item level and only HSN code/SAC is specified at accounting ledger/group level, tax will not be calculated while recording the invoice. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

To know more about managing HSN/SAC, watch the following video:

Order in which HSN code and tax rate are applied for goods

Specifying HSN code and tax rate

Based on your business requirements, you can provide HSN codes and tax rates at different levels. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

Business Requirement	Definition At
Most of the goods have the same HSN code and tax rate	● At company level
A group of items have the same HSN code and tax rate	● At company level for all items. ● At stock group level only for the set with different HSN and tax rate
A few items have different HSN codes and tax rates	● At company level for all items ● At stock item level for the items with different HSN code and tax rate.
Want to apply the same HSN code and tax rate for different transaction types	● At sales/purchase ledger group level for all items
Want to segregate sales or purchase of items with the same HSN code and tax rate	● At sales/purchase ledger level
Change the tax rate (not HSN code) during transaction	● At transaction level

Note: For ease of maintenance and appropriate use of tax rates, specify the rates at the level where you mark the goods as taxable. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

A similar order is applicable in the case of HSN codes.

In case you need to specify a separate tax rate for an item in a specific transaction, you can do so, and the rate specified during the transaction will get the highest priority. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

Order in which SAC and tax rate are applied for services

Specifying SAC and tax rate

Based on your business requirements, you can provide SAC and tax rate at different levels. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

Business Requirement	Tax Rate Definition At
Most of the services have the same SAC and tax rate	● At company level
A group of services have the same SAC and tax rate	● At company level for all services ● At service ledger level for those services alone
Want to apply the same SAC and tax rate for different transaction types	● At sales/purchase ledger group level
Want to segregate sales or purchase of services with the same SAC and tax rate	● At sales/purchase ledger level
Change the tax rate (not SAC) during transaction	● At transaction level

After defining a tax rate at the company level, if a few services attract a different rate, specify the rate in the service ledger. For the services, the rates specified at the service ledger level are applicable. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

You can specify tax rates at the sales or purchase ledger level, or at the ledger group level. This helps in situations where a special tracking as per the nature of tax is required. Then the rate defined at the ledger level will override the tax rates set at the company level or at the service ledger level.

Note: For ease of maintenance and appropriate use of tax rates, specify the rates at the level where you mark the service as taxable.

A similar order is applicable in the case of SAC.

In case you need to specify a separate tax rate for a service in a specific transaction, you can do so, and the rate given during the transaction will get the highest priority.

Note: For ease of maintenance and appropriate use of tax rates, specify the rates at the level where you mark the goods as taxable.

A similar order is applicable in the case of HSN codes.

In case you need to specify a separate tax rate for an item in a specific transaction, you can do so, and the rate specified during the transaction will get the highest priority.

Order in which SAC and tax rate are applied for services

Specifying SAC and tax rate

Based on your business requirements, you can provide SAC and tax rate at different levels.

Business Requirement	Tax Rate Definition At
Most of the services have the same SAC and tax rate	● At company level
A group of services have the same SAC and tax rate	● At company level for all services ● At service ledger level for those services alone
Want to apply the same SAC and tax rate for different transaction types	● At sales/purchase ledger group level
Want to segregate sales or purchase of services with the same SAC and tax rate	● At sales/purchase ledger level
Change the tax rate (not SAC) during transaction	● At transaction level

Note: For ease of maintenance and appropriate use of tax rates, specify the rates at the level where you mark the service as taxable.

A similar order is applicable in the case of SAC. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

In case you need to specify a separate tax rate for a service in a specific transaction, you can do so, and the rate given during the transaction will get the highest priority. HSN CODE AND TAX RATE IN SALES PURCHASE TRANSACTION IN TALLY ERP 9

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