Setting Up Tally a step-by-step guide for beginners

Tally ERP 9, now known as TallyPrime, is one of the most widely used accounting software in India and across the world. It is designed to simplify accounting and financial management for businesses of all sizes. Whether you’re a small business owner or running a large organization, setting up Tally properly is crucial to ensuring smooth operations. In this guide, we’ll walk you through the steps to set up Tally, from installation to configuring basic settings.

1. Install Tally

Before you can start using Tally, you need to install the program on your computer. Here’s how:

1. Download the following installer
   • Visit the official website of Tally Solutions (https://tallysolutions.com/) and download the latest version of TallyPrime. You can download the trial version or purchase the licensed version.
2. Run the installer
   • Once the installation file is downloaded, double-click on it to start the installation process. Follow the on-screen instructions to complete the installation.
3. Select the installation folder
   • During installation, you will be asked to select the folder where Tally will be installed. The default location is usually C:\Tally, but you can change it if necessary.
4. Finish the installation
   • Once installation is complete, TallyPrime is ready to use. Open the application to continue the configuration.

2. Create a company in Tally

Now that Tally is installed, you need to create an entity in the software. An entity in Tally represents your business and its financial details. Follow these steps to create a company:

1. Open Tally
   
   • Run TallyPrime and press Alt+F1 To open the Create Company screen.
2. Enter company details
   
   • Fill in the required details including company name, address, contact information and financial year details.
   • Prove fiscal year (The year in which the accounts are kept).
   • Prove Currency symbol (Usually INR for India, but Tally allows customization).
3. Select country and state
   
   • Choose your country and state from the drop-down list. This will enable Tally to generate GST compliant tax reports and forms.
4. Enable features
   
   • Tally offers various features such as Goods and services tax, wages, and Cost centers. They can be enabled or disabled based on your business needs. If you are setting up a GST compliant system, check this Goods and services tax The feature is enabled.
5. Set up security and backups
   
   • Tally allows you to set security features such as password protection and user access. You can create a master password or set different permissions for other users if necessary.
   • Prove Automatic backup To ensure that your data is continuously stored and protected.
6. Save the company
   
   • After filling out all the details, click He enters To save the company and move forward.

3. Building basic systems

Once your company is established, you need to set up some basic systems to ensure smooth operations. These settings affect how transactions and reports are created.

1. Composition of the fiscal year
   
   • I continue F2: period Specify the fiscal year and period for which you want to enter data.
2. Implementation of goods and services tax
   
   • If your business is registered for GST, go to the GST feature and activate it F11: Features, He chooses Goods and services tax, and enter the required registration details for GST.
3. Enable multiple currencies (if applicable)
   
   • If you are dealing with foreign currency transactions, do so F11: Features, He chooses Multi-currency, and turn it on. It allows you to handle multiple currencies and exchange rates in Tally.
4. Establish cost centers
   
   • For detailed tracking of expenses and income, Tally lets you set up Cost centers. This feature is very useful for companies that need to monitor individual departments or branches.

4. Preparing books and accounts

Ledgers in Tally represent various accounts in which transactions such as sales, purchases, expenses, etc. are recorded. You need to create the ledgers your business needs. Here’s how:

1. Go to the Account Information menu.
   
   • Click on Alt+G and choice Account information, then select Ledgers and creates.
2. Enter ledger details
   
   • For each ledger, you must specify the name (for example, Sales, Purchases, Bank Accounts, etc.), the type of ledger (Income, Expenses, Assets, Liabilities, etc.) and the group to which it belongs.
3. Applying goods and services tax to sales and purchase books
   
   • If you are dealing with GST, be sure to mention this GST details For your sales and purchase books (eg Goods and Services Tax issue Sales and Introduction of goods and services tax for purchase).
4. Create banking and cash books
   
   • Prove Bank and Critical books To manage payments and receipts. You can link these ledgers to your bank accounts to facilitate reconciliation.

5. Definition of types of coupons

In Tally, transactions are recorded through vouchers, which are categorized into different categories such as sales, purchases, receipts, payments, etc. These coupon types can be customized based on your business needs.

1. Go to coupon types
   
   • I continue F11: Features > Voucher types And specify creates To select a new coupon type.
2. Provide the voucher details
   
   • Enter details such as the name of the voucher type (e.g. Sales, Purchase, Payment), the transaction recording method (manual or automatic) and whether you want to retain GST details.

6. Recording transactions

After the initial setup, you can enter transactions. Here are the basic steps for recording transactions:

1. Post payment voucher
   
   • Click on V (For Payment Voucher) and enter details such as relevant date, ledger accounts, amount and method of payment (cash, cheque, bank transfer etc.).
2. Register the receipt voucher
   
   • To get receipts, click R (For receipt slip) and enter relevant details like date, ledger and amount received.
3. Recording of sale/purchase vouchers
   
   • For sale and purchase click Q and for respectively, and enter the relevant details. Include GST details if applicable.
4. Use bank reconciliation
   
   • To sync your banking data, go to Banking services And specify bargaining. It helps you match your accounting entries with actual bank records.

7. Backup and restore data

One of the most important aspects of accounting software is data security. Make sure to make regular backups of your Tally data.

1. Backup data
   
   • I continue Dali entrance > Backup Select the location where you want to save the backup files. This ensures that you have a safe copy in case your computer crashes.
2. Data recovery
   
   • If there is any problem or need to recover lost data, go ahead Repeats In the same menu, select Backup file to restore your data.

8. Preparing reports

Tally offers a variety of reports that help you analyze your financial data. Some key phrases include:

1. Profit and loss account
   
   • I continue an offer > Air conditioning profit and loss View a summary of your income and expenses.
2. Balance sheet
   
   • I continue an offer > Balance sheet View your company’s assets, liabilities and equity.
3. Goods and Services Tax Returns
   
   • For GST compliant businesses, you can generate GST related reports like Tally Jester-1, Jester-2, and Jester-3B.
4. Tax returns
   
   • You can create Tax liability Reports for tax filing efficiency and compliance.

conclusion

Setting up Tally may seem like a complicated task, but by following the steps above, you can ensure that the software is configured correctly for your business. With Tally, managing finances, tracking expenses and complying with GST becomes much easier. Once set up, Tally helps you create accurate reports, monitor cash flow, and make informed business decisions. Update your Tally software to ensure you’re taking advantage of the latest features and improvements.

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