Purchase of Services and Partial Payment to Service Provider [Service Tax] in Tally.ERP 9

In practice, payments towards a bill of services purchased or sold can be made in full or partial depending on terms & conditions.

Example: On 8-7-2012 ABC Company purchased Advertising Services from Krypton Agency for Rs 55, 000 on which Service Taxis charged @ 12.36%(vide no. 568) and on the same day made partial payment of Rs.30,000 towards the bill.

To record the above transaction

1. Record the purchase of services  in Purchase Voucher

2. Record the Payment Voucher to account Partial payment

1. Record the purchase of services  in Purchase Voucher

Go to Gateway of Tally > Accounting Vouchers > F9: Purchase

  • In Accounting Voucher Creation screen, press Alt+I or click on I :Account Invoice if the Voucher is in Item Invoice mode

  • Press F2 and change the date to 08-07-2012

  • In Party’s A/c Name field select the service provider e.g. Krypton Agency

  • Under Particulars select the Service (Purchases) Ledger e.g. Purchase- Advertising Services and press Enter to view Service Tax Details screen

  • In Service Tax Details screen

  • Type of Ref.: Select New Ref from the Method of Adjustment. New Ref is selected for new financial transactions. Where as, Agst Ref is selected to set off the advance payments made.

  • Name: This field displays the Reference Number - Purc/3-1 for the Service Tax calculation.

Note: If the invoice no. is mentioned in the Supplier Invoice No. field, then Tally.ERP 9 captures invoice number instead of voucher number in Reference Number displayed in Name field.

  • Type of Service: Based on the Type of Classification selected in the Service Provider, Type of Service will be defaulted (displayed). By default Input Credit is displayed and Tally.ERP 9 skips the field.

Note: The default Type of Service can be overridden. Press Backspace key to move to Type of Service field and select the applicable Type of Service. The type of service selected during Voucher entry will determine the Type of Service.

  • Category/Service: Based on the Service Category selected in the Purchase Ledger, Category will be defaulted (displayed). By default Taxable Service is displayed and Tally.ERP 9 skips the field.

  • Service Amount: In this field enter the Service Amount, where in you can ascertain Service Amount in the invoice issued by the service provider. On providing the service amount Service Tax gets calculated. Enter Rs. 50,000

  • Amount (Incl. of Tax): In this field the cumulative (collective) amount of Service amount and Tax will be displayed

Note: In cases where the invoice received from the service provider is inclusive of tax, you can enter the invoice amount in theAmount (Incl. of Tax) field. Tally.ERP 9 back calculates the amount to arrive at the Service amount and Tax portion. The service amount will be displayed in Service Amount field and Tax details against the Tax Head.


  1. In Amount field the Service Amount of Rs. 55,000 will be defaulted automatically

  2. Under Particulars select Service  Tax Ledger e.g. Service Tax @ 12%. Service Tax amount will be calculated and displayed automatically.

  3. Under Particulars select Education Cess Ledger e.g. Education Cess @ 2%. Education Cess amount will be calculated and displayed automatically.

  4. Under Particulars select Secondary Education Cess Ledger e.g. Secondary Education Cess @ 1%. Secondary Education Cess amount will be calculated and displayed automatically.

  5. Enter the Bill-wise Details as shown below:


The completed service Purchase Voucher is displayed as shown:


  1. Press Enter to Accept the Voucher.

2. Record the Payment Voucher (to account Partial Payment)

Go to Gateway of Tally > Accounting Vouchers > F5: Payment

  1. Press F2 and change the date to 08-07-2012

  2. In Debit field select Krypton Agency and press Enter to view Service Tax Details screen

  3. In Service Tax Details screen

  4. In Type of Ref field select Agst Ref to adjust the Service Taxof the bill dated 8-7-2012

  5. In Name field select the tax bill - Purc/3-1 dated 8-7-2012 from the List of Pending Tax Bills against which the payment is made.

  6. On selection of bill, details in Type of Service, Category, Amount (incl. of tax), Service Amount fields and tax bifurcation will be displayed automatically.

  7. As ABC Company is making Partial payment of Rs. 30,000 (inclusive of service Tax) in Amount field specify 30,000. Based on the amount specified Service Tax and Cess amount will be re-calculated and displayed


  1. In Bill-wise Details screen

  2. In Type of Ref field select Agst Ref from Method of Adj. list to adjust the payment towards the bill dated 8-7-2012

  3. In Name field select the bill - 568 dated 8-7-2012

  4. Amount will be displayed automatically


  1. In Credit field select the Bank Ledger - Canara Bank. Amount will be displayed automatically

  2. Enter Narration, if required.

Completed Payment Voucher is displayed as shown:


  1. Press Enter to save.

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Reversal of Input Credit Utilised [Service Tax] in Tally.ERP 9  
Tally.ERP 9 Reference Manual LIBRARY
Installation of Tally.ERP9
Site Licensing of Tally.ERP9
Shortcut Keys in Tally.ERP9
Maintaining Company Data
Creating Masters
5a. Accounts Information [Creating Masters]
5b. Inventory Information [Creating Masters]
Voucher Entry
Reports in Tally.ERP9
Excise for Dealer
Excise for Manufacturer
Reports [ Excise for Manufacturer]
Excise for Importer
Service Tax in Tally.ERP9
Tax Collected at Source (TCS) in Tally.ERP9
Tax Deducted at Source (TDS) in Tally.ERP9
Value Added Tax (VAT) in Tally.ERP9
Central Sales Tax (CST) in Tally.ERP9
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