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VAT Computation report displays various types of Input VAT Tax and Output VAT tax ledgers employed and transacted during voucher entry.
Tally provides a clear-cut presentation on how VAT is computed for a given period. It also provides a bird's eye view of all transaction related to VAT.
To view the VAT Computation report
Go to Gateway of Tally > Display > Statutory Reports > VAT Reports > VAT Computation.
Let us consider the following that we made, for VAT Computation:
1. Purchased from Creditor-1, 100 quantities of item1 at the rate of Rs.50 each.
The Input VAT@4% for this amount is Rs.200.
2. Purchased from Creditor, 100 quantities of item2 at the rate of Rs.50 each. However we applied a discount of Rs.200 here. Also, Excise tax of Rs.800 and Educational Cess of Rs.16 were levied on this.
Therefore we applied the InputVAT@4% on the Assessable value of Rs.5616, which is Rs.224.64.
Therefore total Input VAT = Rs.200 + Rs.224.64 = Rs.424.64
3. Sale of 50 quantities of item1@Rs.300 to Debtor-1 .
OutputVAT@4% = Rs.600.
4. Sale of 100 quantities of item @ Rs.100 each.
Output VAT@1%= 100
Therefore total Output VAT = Rs.600 + Rs.100 = Rs. 700
Therefore VAT Payable-> Output VAT - Input VAT = Rs.275.36
This is calculated automatically by Tally and the VAT Computation screen will be displayed as shown below.
The Reports for the two Purchases and one Sales transaction is shown below respectively:
For VAT exempted or zero rated transactions
If you have transactions that are exempted from VAT
For example, in the case of Inter-State Sales, the Tax Amount column will show as NIL in the Computation screen.