How to Create a Stock Item in TallyPrime: 6 Easy Steps + Example

Here’s a detailed explanation on how to create a stock item in TallyPrime, incorporating GST (Goods and Services Tax):

1. Accessing Stock Item Creation:

There are two primary ways to access Stock Item creation:

1. Gateway of Tally Method:

• Open the TallyPrime Gateway of Tally (usually Alt+F12).
• Navigate to “Create” and select “Stock Item” (or press Alt+G followed by “Create Master” and then “Stock Item”).

2. Inventory Info Method:

• Go to Gateway (if not already open).
• Navigate to “Inventory Info” and select “Stock Items.”
• Under “Single Stock Item,” choose “Create.”

2. Stock Item Details:

1. Name:

Enter a descriptive name for your stock item (e.g., “T-Shirt,” “Mobile Phone,” “Laptop”).

2. Alias (Optional):

Add alternative names or abbreviations for the item (e.g., “T-Shirt (M)” for a medium size).

3. Under:

Select a relevant stock group (category) for the item if you’ve already created groups (e.g., “Clothing” for T-Shirts). You can create a new group on the fly by pressing Alt+C.

3. Unit of Measurement:

Choose the appropriate unit of measurement for your stock item (e.g., “Pieces” for T-Shirts, “Units” for Laptops).

4. GST Settings:

1. VAT Applicable (for VAT enabled companies):

Set this to “Applicable” if your business deals with VAT (Value Added Tax) instead of GST.

2. Set/Alter GST Details:

Choose “Yes” to define GST details for the stock item.

5. Defining GST Details:

1. Calculation Type:

Select “On Item Rate” if the GST rate is already included in the purchase/sale price of the item.

Choose “On Margin” if you need to calculate GST separately based on the cost price and selling price.

2. Tax Rate:

Select the applicable GST rate from the list (e.g., 5%, 18%).

3. Additional Expense/Income Ledger (Optional):

Utilize this for specific expense or income accounts related to the GST on this item (applicable in some scenarios).

6. Saving the Stock Item:

Once you’ve entered all the details, press Ctrl+A to save the newly created stock item with its associated GST configuration.

7. Example: Creating a T-Shirt with 18% GST

You want to create a stock item for “T-Shirt (M)” with a purchase price of Rs. 100 (excluding GST).

1. Steps:

Follow the access methods mentioned above to create a new Stock Item.

1. Stock Item Details:

• Name: T-Shirt (M)
• Under (Optional): Select a relevant stock group (e.g., “Clothing”).

2. Unit of Measurement:

Pieces

3. GST Settings:

• Set/Alter GST Details: Yes

4. Defining GST Details:

• Calculation Type: On Item Rate (as GST is included in the price)
• Tax Rate: 18%

8. Benefits of Defining GST in Stock Items in TallyPrime:

1. Accurate GST Calculations:

Ensures automatic calculation of GST during purchase and sales transactions involving the item.

2. Simplified Reporting:

Streamlines generation of GST reports by pre-defining relevant details for each stock item.

3. Improved Compliance:

Helps maintain accurate GST records for filing returns and audits.

9. Additional Tips while Creating Stock Items in TallyPrime:

• Maintain a consistent approach to defining GST within your stock items (On Item Rate or On Margin) for simplified management.
• Regularly review and update your stock item GST details to reflect any changes in tax rates or regulations.
• Consider utilizing features like HSN (Harmonized System Nomenclature) codes within stock item configurations for enhanced GST reporting capabilities (applicable in some countries).

By following these steps and incorporating the mentioned tips, you can effectively create stock items in TallyPrime with accurate GST configurations, ensuring efficient inventory management and streamlined GST compliance for your business.