How to Set Credit Limits for Parties in TallyPrime: 2 Easy Methods

Here’s how to set credit limits for parties (customers or suppliers) in TallyPrime:

There are two main methods to achieve this:

Method 1: Setting Credit Limits for Individual Ledgers

This approach is suitable when you want to define credit limits for specific customer or supplier accounts.

1. Access Ledger Creation/Alteration:

1. Create Ledger:

If the party ledger (customer/supplier account) doesn’t exist, navigate to the “Create Ledger” screen. You can access this through the Gateway of Tally or by using Alt + G (Go To) followed by “Create” > “Ledger”.

2. Alter Ledger:

If the party ledger already exists, locate it within the Chart of Accounts. You can use the search functionality or browse the account hierarchy. Double-click on the ledger name to open it for alteration.

2. Enable Credit Limit:

In the “Create Ledger” or “Ledger Alteration” screen, locate the “Credit Limits” section. There might be a checkbox labeled “Enable Credit Limit” or a similar option. Check this box to activate credit limit functionality for the specific party ledger.

3. Set Credit Limit and Period (Optional):

1. Credit Limit:

Enter the maximum credit amount the party can avail before needing to settle their dues.

2. Credit Period (Optional):

If you want to define a specific credit period (number of days) within which the payment should be received after the sale, enter the value in the designated field. Leaving this blank implies immediate payment is expected.

4. Save and Accept:

Once you’ve entered the credit limit and credit period (if applicable), press Ctrl + A or click the “Accept” button to save the changes and establish the credit limit for the chosen party ledger.

Method 2: Setting Credit Limits for Multiple Ledgers (Groups)

This method is efficient if you want to assign credit limits to a group of customer or supplier accounts that share similar credit terms.

1. Access Multi-Ledger Limit Alteration:

Navigate to the “Multi Ledger Limit Alteration” screen. You can reach this screen through the Gateway of Tally or by using Alt + H (Multi-Masters) followed by “Multi Create” > “Credit Limits”.

2. Select Ledger Group:

In the “List of Groups” section, choose the group that contains the party ledgers (customers/suppliers) for which you want to set credit limits. This group could be named “Sundry Debtors” for customers or “Sundry Creditors” for suppliers.

3. Set Credit Limit and Period (Optional):

• Similar to Method 1, define the “Credit Limit” and “Credit Period” (optional) in the designated fields. These values will be applied to all ledgers within the selected group.

4. Save and Accept:

After entering the desired credit limit and credit period (if applicable), press Ctrl + A or click “Accept” to save the credit limit settings for all ledgers under the chosen group.

Additional Considerations:

1. Override Credit Limit:

TallyPrime allows you to enable an option for “Override Credit Limit using post-dated transactions”. This setting should be used cautiously, as it permits exceeding the credit limit for specific transactions if post-dated cheques or similar instruments are involved.

2. Credit Days Alert:

You can configure TallyPrime to display an alert during voucher entry if the customer’s credit days are about to expire. This functionality helps with proactive credit management.

3. Credit Management Reports:

TallyPrime offers reports that can be used to monitor credit limits, analyze outstanding dues, and identify potential credit risks.

By following these methods and considering the additional points, you can effectively set and manage credit limits for your customers and suppliers within TallyPrime, promoting responsible credit practices and safeguarding your business finances.