Tally.ERP 9 Series A Release 3.

Income Tax

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Agenda
Enabling Income Tax
Configuring Employee Masters
Creating/Altering IT Pay Head

Income Tax Master Configuration

Income Tax Reports

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Enabling Income Tax

Provide
Income Tax
Details

Gateway of Tally > F11: Features > Statutory &

Taxation
Enable Payroll
Statutory &
Specify Details

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Income Tax Computation

Tally.ERP 9 Identifies,
All earning components are considered as fully taxable
GatewayThe
Tally
Display
> Payroll
> Statutory
of
PF and
PT>
are
considered
for Deduction
approximate
Income
TaxReports
Computation
can beReports

> Income viewed

Tax > Computation
immediately after enabling the Payroll
Statutory Feature, without any further configurations.

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Configuring Employee Masters

Gateway of Tally > Payroll Info. > Employees >

Alter

Income Tax slab will be

applied based on Gender &
Date of Birth (Senior
Citizen)

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Income Tax rate gets

selected based on PAN
availability & non
availability

Create TDS Pay Heads

Create/Alter Salary Details for all Employees for effect TDS Deduction.

Gateway
of Tally > Payroll Info. > Pay Heads >
Note: If TDS Pay Head already exists, you have to alter the same as shown.
Create/Alter

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Income Tax Master Configuration

Pay Head Configuration

Declarations
Override Exemption Value
Override Tax Value
Tax Configuration
Previous Employer Details

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Pay Head Configuration

PayPayroll
Head Configuration
Gateway of Tally >
Info > Income Tax Details
By default all pay heads are is Completed
> Pay
Head
grouped
underConfiguration
Other
Earnings/ Allowances(Fully
Taxable)

TDS gets computed

When
method
ofcalculation
calculation
based
onof
Projected
When
method
isis
Select
the Pay
head
and or On
selected
astoOn
Actuals
then
Actuals
whichever
is
On
Projection
then
Deduct
press
enter
group
the
Deduct
TDS
across
period
selected
TDS
by default
will be set Yescan
Income
Tax Components
be manually
set to Yes or No
respectively

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Declarations
Exemptions U/s 10
o
o
o
o
o

Rent and Place of Accommodation

Children Education Allowance
Children Hostel Expenditure Allowance
Conveyance Allowance
Leave Travel Allowance

Deductions Under Chapter VIA

o Investments (U/s 80C and 80CCF)
o Others (U/s 80D, 80DD, 80E etc.)

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Declaration of Exemptions U/s 10

Press Enter here, to
declare Rent details
and Place of
Accommodation re

Gateway of Tally > Payroll Info. > Income Tax

Details > Specify
Declarations
the Rent details, details of Actual rent
Paid and Accommodation
Note: Actual rent Paid can be entered later also

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10

Press Alt+I for Multi Employee Single Component

declaration
Press Alt+N for Single Employee Multi Component
declaration

Deductions under Chapter VI-A

Gateway
of Tally > Payroll Info. > Income Tax
Similarly, specify details for Other deductions
Details > Declarations

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11

Override Income Tax

If the employer wants to

override
Go to the
Gateway
earningsof Tally > Payroll Info. > Income Tax
Detailsor Exemption value
(Income)
or even Tax value of the
employee it can be done from
the Override options

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12

Tax Configuration

Gross Salary
Allowance to the extent exempt U/s 10
Deduction U/s 16
Other Income reported by Employee
Deductions under Chapter VI-A
Relief
Tax Deduction Details

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13

Press Enter to specify

Allowance to the extent exempted
U/s
10
the Declaration

Gateway of Tally > Payroll Info. > Income Tax

required details and save
Details Specify
> Taxthe
Configuration
Press Enter on the
required Component
Press Enter here to
Configure the Pay
Heads

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14

Previous Employer Details

Gateway of Tally > Payroll Info. > Income Tax

Details
Previous Employer
Income/Exemption and Tax
Deduction Details can be provided
from the above masters

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15

Processing Payroll

Gateway of Tally > Payroll Vouchers

Income Tax
amount Deducted

Press Alt+A for

Payroll Auto Fill

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16

Income Tax Payment

Gateway of Tally > Accounting

Vouchers
> F5
Specify the details
for
Challan printing
PressPress
Alt+A
for Payroll
Press Enter to accept.
Page
Auto Fill
Up and followed by Alt+P

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17

Payroll Income Tax Reports

Computation
Salary Projection
Returns
o Form 16
o Form 12BA
o ITR 1

Challan Reconciliation
Exception Reports
o PAN Not Available
o Other Records
o TDS Variance
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Payroll Reports

Gateway of Tally > Display > Payroll Reports >

Statutory Reports > Income Tax

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19

Income Tax

Thank You

For more information visit

www.tallysolutions.com

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