India: GST and depreciation

This page collects what is specific to running the product for an organisation in India: how GST is entered on purchasing documents, where GSTINs go, and how the statutory and income-tax depreciation books are kept side by side. Everything else works as described on the general pages, which link here where India differs.

Nothing here is tax advice. The product holds the rates, lives and rules you give it; confirm them against the Act and notifications in force with your accountant before a book runs on them.

The financial year and currency

An Indian company’s financial year runs 1 April to 31 March. Set it up as a fiscal calendar starting in April — the India depreciation pack does this for you, as Financial year (April–March), monthly. Budgets, capex plans and depreciation books are all counted in that calendar. Amounts are shown in rupees (₹) when the company’s currency is INR. Lakh and crore grouping — ₹3,12,12,014.48 rather than ₹31,212,014.48 — follows each person’s language and region setting in their own profile, so ask your people to choose an Indian English region there.

GST registration numbers

Where	Field	Use
Your company, under organisation structure	The tax registration number	Printed under the address on the letterhead of documents the product produces
Each vendor, on the onboarding form and vendor record	Tax Identifier — “GSTIN, VAT number or local equivalent”	Recorded for invoices and tax reporting

The New vendor form in an Indian organisation, with the Tax Identifier field for the GSTIN

GST on purchase orders and invoices

A new purchase order in rupees, with the Tax column on the line

Document	How GST is entered
Purchase order line	Tax is the rate as a fraction: 0.18 for 18%, 0.05 for 5%, 0.28 for 28%. Each line can carry its own rate, so mixed-rate orders are fine. The order shows a Tax total and includes it in the Order total
Supplier invoice on an order	Tax is the total GST on the invoice, as an amount. The three-way match compares quantities and unit prices; tax is carried on the invoice total
Vendor invoice on a job	Lines are entered as billed; include GST as the vendor shows it

A line carries one combined rate. The product does not split it into CGST, SGST/UTGST and IGST, and has no HSN or SAC code fields — record the combined rate here and keep the component split, place of supply and e-invoicing in your accounting system. If you need the HSN or SAC on the record, your administrator can add a custom field to parts or order lines in Form Studio.

GST and budgets

When you open a budget head, Counted decides how documents consume it:

Option	Effect	Use it when
Gross of recoverable tax	The whole document, GST included, is charged to the head	GST is a cost to you — for example ineligible input tax credit
Net of recoverable tax	The document’s tax is taken off before it is charged	You claim input tax credit, so your ledger holds spend net of GST — usually the right choice for an Indian manufacturer

Net takes off the whole tax on the document; a head cannot treat part of an order’s GST as recoverable and part not.

Opening a budget head in rupees, with the Counted choice between gross and net of recoverable tax

Depreciation: two statutes, two books

An Indian company depreciates the same fleet twice: under the Companies Act 2013 for its accounts, and under the Income-tax Act 1961 for its return. The Depreciation screen keeps both books at once, and they are expected to disagree.

This month in an Indian organisation: the Companies Act book's August draft beside the income tax year's draft

	Statutory accounts	Income tax
Authority	Companies Act 2013, Schedule II — Ind AS 16	Income-tax Act 1961, section 32 and Appendix I
Method	Straight line over the Schedule II useful life	Written-down value at the block rate
Unit	One asset	One block of assets per rate
Period	Monthly	Annual — one computation per financial year
Residual value	5% of cost (the statutory cap)	None — a block depreciates towards nothing
First period	Pro-rata from the day the asset is put to use	Full rate if used 180 days or more in the year, half rate if fewer
Rounding	Paise	Whole rupees
Asset sold	Proceeds against carrying amount give a gain or loss	Proceeds reduce the block; no gain or loss on a single asset
Multiple shifts	Plant and machinery: ×1.5 for double shift, ×2 for triple shift	No equivalent

The Books tab with the Companies Act and Income-tax Act books

Setting it up: the India country pack

Under depreciation settings, a company with no book is offered India — Companies Act and Income-tax Act. Installing it creates in one step:

What	Contents
Books	Statutory accounts (monthly, per asset, primary) and Income tax (block of assets) (annual, pooled)
Calendar	Financial year April to March
Schedule II classes and policies	Plant and machinery (general) 15 years, with the multi-shift uplift · Electrical installations 10 years · Furniture and fittings 10 years · Motor cars 8 years · Servers and networks 6 years · End-user computers 3 years · Factory buildings (RCC frame) 30 years — all straight line, 5% residual, charged from the day put to use
Income-tax blocks	Plant and machinery @ 15% (machines, vehicles and electricals together) · Computers and software @ 40% · Furniture and fittings @ 10% · Buildings @ 10% — written-down value with the 180-day rule

After installing, two things remain before either book can post a journal:

Add your own depreciation expense and accumulated depreciation ledger accounts and map them to the classes.
Confirm the Schedule II lives against your own technical assessment (the Act allows a different life where you can justify it) and the 5% residual, which is a cap rather than a requirement.

Additional depreciation under section 32(1)(iia) is not modelled. Assets you already own arrive through cutover with an opening figure per book.

The statutory book

Runs monthly like any per-asset book. In the run, a plant asset that worked more than a single shift shows the factor in the Shift column — for example ×1.5, with the hours it ran against the site’s normal hours. The multi-shift calculation reads the asset’s running-hours meter, so plant that should get the uplift needs one.

On the Register each asset appears once per book — two classes, two methods, two answers. In the income tax book the carrying amount reads in a block, because no individual asset inside a block has one.

The income-tax book: blocks of assets

The tax book is computed once a year, on the Blocks tab:

The section 32 computation as rows: opening, additions at full and half rate, proceeds out, depreciation and closing per block

Column	Meaning
Opening	Last year’s closing written-down value
Added, full rate	Additions put to use for 180 days or more in the year
Added, half rate	Additions put to use for fewer than 180 days — half the rate applies to them this year
Proceeds out	Sale proceeds of assets sold from the block
Depreciation	The year’s allowance
Excess proceeds	Where proceeds exceed the block, it goes to nil and the excess is a capital gain for your return. The product records it; it does not compute the gain
Closing	Carried to next year

The year in progress is a draft until you post it at year end.

Selling an asset

A sale is recorded once, with Dispose on the asset’s Finance tab, and treated differently in each book:

A car sold: a loss in the statutory accounts and a reduction of the plant and machinery block for tax

Book	Result
Statutory accounts	Proceeds against the carrying amount — a gain or loss, with a disposal journal
Income tax	The proceeds reduce the block (reduces a block); no gain or loss on the asset itself

Depreciation

The monthly run, register, blocks, projects and journals.

Purchase orders

Lines, tax and three-way matching.

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Release notes

India: GST and depreciation

The financial year and currency

GST registration numbers