Adjustment of Normal Advances (received) Towards Service Bill [Service Tax] in Tally.ERP 9

In some cases, businesses receive advance from the customer and will account such advances without calculating the Service Tax. Later (after providing service) while raising the service bill, advance received will be adjusted towards the bill and balance will be displayed as pending for payment.

Tally.ERP 9 supports to adjust normal advances received (tax not calculated while accounting advances) form the customers towards the sales bill. The adjusted amount will be displayed in all the Service Tax reports as amount realised towards the service rendered.

Adjustment of Normal Advance received/paid towards service bill (Sales/Purchase) is supported in Tally.ERP 9 from Release 2.1.

Example: On 22-7-2012 ABC Company received Rs. 50,000 as advance from Innovative Works.

On 24-7-2012 ABC Company rendered Event Management Service for Rs. 1,25,000 to Innovative Works and while raising the bill adjusted advance of Rs.50,000.

Step 1: Record a Receipt voucher (to account advance from customer)

Go to Gateway of Tally > Accounting Vouchers > F6: Receipt

  1. Press F2 and change the date to 22-07-2012

  2. In Credit field select Innovative Works and press Enter to view Service Tax Details screen

  3. In Service Tax Details screen

  4. In Type of Ref select End of List and press Enter to exit Service Tax Details screen

  1. In Credit Amount field enter Rs. 50,000 and press Enter to view Bill-wise Details screen

  2. In Bill-wise Details screen

  3. In Type of Ref field select Advance from Method of Adjustment

Note: The Type of Ref selected should be Advance.

  1. In Name field enter the Bill Name

  2. Amount will be displayed automatically:


  • Press Enter to accept the Bill details

  1. In Debit field select Cash or Bank Ledger depending on the nature of payment received. Here ABC Company received payment via cheque and hence Bank Ledger - Canara Bank is selected

  2. Amount will be displayed automatically

  3. Enter Narration, if any


  1. Press Enter to save

Step 2: Record a Sales Voucher (to account the sale of services and adjust advance received towards the service bill)

Go to Gateway of Tally > Accounting Vouchers > F8: Sales

  1. Press F2 and change the date to 24-07-2012

  2. In Party A/C Name field select Innovative Works from the List of Ledger Accounts

  3. Under Particulars select Sales- Event Mgt Services ledger and press Enter to view Service Tax Details screen

  4. In Service Tax Details screen

  5. In Type of Ref field select New Ref

  6. In Name field  Sale/7-1 will be displayed as the Reference Number. Accept the default number

  7. Based on the Type of Classification selected in the Service Receiver, Type of Service will be defaulted (displayed). By default Taxable is displayed and Tally.ERP 9 skips the field

  8. Based on the service Category selected in the Sales Ledger, category will be defaulted (displayed). By default Taxable Service is displayed and Tally.ERP 9 skips the field

  9. In Service Amount field enter the value of service provided Rs. 1,25,000

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


  1. In Amount field of Voucher Creation screen, Service Amount of Rs. 1,25,000 will be displayed

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

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

  4. Select Secondary Education Cess Ledger e.g. Secondary Education Cess @ 1%. secondary Education Cess amount will be calculated and displayed automatically

  5. In Bill-wise Details screen

  6. In Type of Ref select Agst Ref

  7. In Name field select IW/00521

  8. In Amount field enter Rs. 50,000 (advance received on 22-7-2012)

  9. In Type of Ref select New Ref

  10. In Name field select ABC/758

  11. In Amount field the balance amount of Rs. 90,450 will be displayed automatically


The completed Sales Voucher appears as shown:


  1. Press Enter to save

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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