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Krishi Kalyan Cess In Tally ERP 9

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As you all know, from 1st June 2016 onward a new cess is introduced on all taxable services by India Goverment. The rate of KKC -Krishi Kalyan cess is 0.5%  on assessable vale of taxable services.From Tally ERP 9 Release 5.3.8 you will find new option called Krishi Kalyan Cess under Duties and taxes. Lets have a detailed discussion on KKC in Tally ERP 9.

Recommend Read: How to configure Service tax with Krishi Kalyan Cess & Swachh bharat cess in Tally.ERP 9 Release 4.93 and lower versions.

After implementation of KKC the rate of service tax become 15% on taxable service provided.Now service tax collected as follows.

  • Service tax – 14 %     – Calculated on total taxable services
  • Swachh Barath Cess  – 0.5 % – Calculated on total taxable services
  • Krishi Kalyan Cess     – 0.5% – Ccalculated on total taxable services.
  • Total Service tax collected is now –  15 %.

Accounting Codes for Krishi Kalyan Cess

New accounting codes has been alloted for the payment of KKC Vide circular No Circular No. 194/04/2016-ST F. No. 354/31/2016-TRU. The Accounting codes is as follows.

Sr NoKrishi Kalyan Cess (Minor Head) Tax CollectionOther Reciepts (Interest) Deduct RefundsPenalties
10044-00-507004415090044151000441511 00441512

Important Points to note

  • Cess will be accounted separately and paid to government using account head provided above.
  • CENVAT Credit is available for the payment of Krishi Kalyan cess.
  • CENVAT credit on service tax cannot be utilized for the payment of KKC.

How to implement Krishi Kalyan Cess in Tally ERP 9

To implement KKC in Tally, you have to update your Tally ERP9 to the latest version of Release 5.3.8 .After updating the software.

Define Krishi Kalyan Cess in Tally.ERP9

You can define Krishi Kalyan Cess at company level, Ledger level,Group Level  or even in voucher type level. Here I am Setting KKC rate in Company Level. To do this go to

Gateway of Tally> F11 Features>Statutory & Taxation

In the statutory and taxation screen enable the option Set/alter service tax details to Yes.

set/alter service tax details

Press Enter,You will be in new screen called service tax details screen, In that screen you will find same option again, set/alter service tax details

Service taxdetails

Enable this option by typing Yes and press enter key.Again A service category creation screen will appear,In the screen Enter the tax details as follows.

  • Service tax -14%
  • Swachh Bharat cess : 0.5 %
  • Krishi Kalyan Cess( KKC) : 0.5 %

Service category creation scree

Applicability date 01-06-2016. Press Enter to save all the screens opened.

Creating Krishi Kalyan cess Ledger in Tally ERP9

To create KKC Ledger

Gateway of Tally> Accounts info> Ledger > create

Name : Enter name of the ledger

Under: Duties & taxes

Type of Duty/ tax :  Select , Krishi Kalyan Cess.

Krishi Kalyan Cess ledger

Rounding Method: Select desired method and save the screen.

Krishi kalyan cess account

Service Invoice or voucher entry with Krishi Kalyan Cess

Lets create a scenario for the service tax voucher with KKC.

ABC Ltd Provided Architect Service to XYZ Ltd  for 100000 on 01-06-2016. Service tax to be collected @ 14 % is 14000 + Swachh bharat cess to be collected @ 0.5% on total taxable service provided= 500 KKC to be collected @ 0.5 % on taxable service = 500

Lets enter this service invoice  or service voucher with KKC transaction in Tally.ERP 9.

Go to Gateway of Tally> Accounting Vocuher> F8 Sales

  • Choose Alt + I for selecting Accounting Invoice if not already selected.
  • Enter The reference Number , Party A/c Name : XYZLtd,
  • Particulars : Architect Service and its amount in our case 100000
  • Service tax in the next line, tax automatically calculated.
  • Swacch bharat cess in the next line tax calculated automatically @ 0.5%
  • Krishi Kalyan Cess @ 0.5% in the fourth line press enter and save the screen.

Service tax entry with krishi kalyan cess

Now Press Enter to accept the screen.

Recommend Read : How to configure Service tax with Krishi Kalyan Cess complete setup guide

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