Payment Voucher (F5)
Prerequisite: Day 17 - Contra Voucher
🎯 Learning Objectives:
- Record business expense payments (Rent, Salary, Utilities)
- Record payments to sundry creditors against bills
- Record loan repayments and asset purchases by cash/bank
- Handle cheque and electronic fund transfer allocations
2. What is this?
Simple Layman Definition: Payment Voucher (F5) is an essential component of Recording & Maintaining Accounting Transactions, providing structured operational procedures to ensure commercial compliance and financial clarity.
Professional Accounting Definition: Payment Voucher (F5) represents a standardized accounting and enterprise resource management methodology governed by Indian Accounting Standards (Ind-AS) and statutory regulatory mandates in TallyPrime.
| Aspect | Details & Practical Relevance |
|---|---|
| Primary Purpose | To systematically process, control, audit, and report payment voucher (f5) transactions with maximum financial accuracy and operational efficiency. |
| Where It Is Used | Implemented across corporate enterprises, SME trading houses, manufacturing plants, distribution networks, and chartered accountancy firms in India. |
| Who Uses It | Senior Accountants, Tally Operators, Accounts Executives, Finance Controllers, and Tax Auditors. |
| Why It Matters in Accounting Jobs | Mastery of Payment Voucher (F5) is directly tested in accounting employment interviews and required in day-to-day corporate accounts administration. |
📌 Real-Life Workplace Example:
A registered trading firm in Mumbai executes payment voucher (f5) to maintain real-time compliance with suppliers, clients, and GST authorities.
3. Why is this Important?
- Why Businesses Use It: Prevents revenue leakage, optimizes capital utilization, satisfies statutory audits, and preserves accurate corporate ledger history.
- Why Accountants Need It: Provides a structured protocol to record entries correctly on the first attempt without risking post-audit adjustments.
- Why Required in TallyPrime: TallyPrime automates report compilation, GST triangulation, and ledger balancing when Payment Voucher (F5) is configured properly.
- What Problem It Solves: Eliminates manual calculation errors, reconciles discrepancy gaps, and prevents non-compliance penalties under tax regulations.
- What Happens If Not Used Correctly: Incorrect handling causes erroneous financial statements, misleading management reports, and statutory penalties under GST/Income Tax Acts.
4. When is it Used?
Executed whenever relevant commercial events occur during the daily billing, payment, inventory movement, or period-end closing cycles.
⚖️ Decision-Making Rule:
Whenever evaluating this transaction, verify whether it represents an Asset, Liability, Revenue, or Expense. Apply double-entry rules strictly: Total Debits must equal Total Credits before confirming in TallyPrime.
5. How Does it Work?
The operational flow for Payment Voucher (F5) follows a clear sequential procedure:
1. Source Document Verification
➔
2. Identify Debit & Credit Ledgers
➔
3. Input in TallyPrime
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4. Audit & Reconcile Reports
- 1. Verify authorization and underlying source document (invoice, challan, advice, or receipt).
- 2. Identify the applicable accounts or inventory items affected by the payment voucher (f5) transaction.
- 3. Apply appropriate accounting rules, tax slabs, or inventory valuation parameters.
- 4. Navigate to the designated menu in TallyPrime and input mandatory master/voucher parameters.
- 5. Verify arithmetical balance, GST/TDS tax calculations, and bill-wise reference allocations.
- 6. Accept and save the entry; verify report reflections in Trial Balance, Stock Summary, or Day Book.
6. Accounting Logic & Journal Entry
Representative Transaction
Double-Entry Standard
"Recorded sales of merchandise for ₹1,18,000 (Taxable ₹1,00,000 + CGST 9% + SGST 9%) to Metro Retailers on credit."
Identified Accounts: Metro Retailers (Debtor) | Sales A/c (Revenue) | Output CGST | Output SGST
Applied Rule: Debit the receiver (Debtor); Credit income (Sales); Credit output tax liabilities.
Applied Rule: Debit the receiver (Debtor); Credit income (Sales); Credit output tax liabilities.
| Particulars | Debit (₹) | Credit (₹) |
|---|---|---|
| Metro Retailers A/c | ₹1,18,000 | |
| To Sales A/c | ₹1,00,000 | |
| To Output CGST A/c | ₹9,000 | |
| To Output SGST A/c | ₹9,000 |
(Being credit sales invoice # INV/042 issued with GST.)
Why This Logic Works: The primary account is debited to recognize asset addition or operating expense; the bank account is credited to reflect the reduction in liquid funds.
7. TallyPrime Practical Execution (Step-by-Step)
1
Open Gateway of Tally
Launch TallyPrime
Load Active Company
2
Open Target Function
Press Alt+G (Go To) or select required menu for Payment Voucher (F5)
3
Select Mode / Voucher
Press designated shortcut key (e.g. F2 for Date, F4-F9 for Vouchers)
4
Input Party / Account
Select Debit and Credit ledgers or relevant item masters
5
Verify Values & Tax
Ensure invoice value, quantity, and statutory duty match source bills
6
Enter Bill-wise Reference
Allocate New Ref, Agst Ref, or Advance with credit terms
7
Save & Verify
Press Ctrl+A to save; inspect Trial Balance or Day Book to audit posting
8. Field-by-Field Screen Breakdown
| Field Name | Meaning & Significance | What to Enter | Accounting / Compliance Rule |
|---|---|---|---|
| Date | Effective transaction date | Current transaction date |
Must fall within active Financial Year |
| Particulars | Target ledger account | Applicable master ledger |
Select from pre-configured Chart of Accounts |
| Amount | Monetary transaction value | Exact invoice/voucher value |
Must balance exactly between Dr and Cr |
| Narration | Audit transaction description | Description for Payment Voucher (F5) |
Document voucher/instrument numbers for audit trail |
| Tax / Duty | Statutory deduction or tax | Applicable GST/TDS head |
Auto-computed or selected as per tax rate |
9. Real-World Business Case Scenarios
🏢 Indian Corporate Scenario:
Zenith Enterprises (Noida, UP) maintains computerized accounting for Payment Voucher (F5) across its trading operations with monthly turnover of ₹45 Lakhs.
10. Dedicated Practice Set & Tally Datasets
📝 Practical Assignment: Payment Voucher (F5) Practice Dataset: Supplier Settlements & Expenses
Settle these pending payments against supplier bills (Agst Ref) and record commercial expense payments.
| Date | Ref / Chq # | Supplier / Expense Head | Payment Amt (₹) | Mode / Account | Narration |
|---|---|---|---|---|---|
| 1-Apr | CHQ-500101 | Anil InfoTech | 1,27,500 | Bank Current A/c | Being payment agst bill P-106 |
| 1-Apr | CHQ-500102 | Anil InfoTech | 3,500 | Bank Current A/c | Being payment agst bill P-104 |
| 2-Apr | NEFT-771 | Anil InfoTech | 70,700 | Bank Current A/c | Being payment agst bill P-108 |
| 2-Apr | CHQ-500103 | Mahendra InfoTech | 42,500 | Bank Current A/c | Being payment agst bill P-103 |
| 3-Apr | NEFT-772 | Mahendra InfoTech | 76,200 | Bank Current A/c | Being payment agst bill P-105 |
| 4-Apr | CHQ-500104 | Sun Micro Pvt Ltd | 19,000 | Bank Current A/c | Being payment agst bill P-101 |
| 5-Apr | CHQ-500105 | Sun Micro Pvt Ltd | 54,000 | Bank Current A/c | Being payment agst bill P-102 |
| 7-Apr | Cash | Office Refreshments & Tea | 2,400 | Cash in Hand | Being weekly office tea expense |
| 10-Apr | CHQ-500106 | Showroom Rent | 35,000 | Bank Current A/c | Being April rent paid to landlord |
| 12-Apr | Cash | Stationery & Printing | 3,800 | Cash in Hand | Being invoice books & printer cartridges |
🔍 Checking Effect & Report Verification in TallyPrime:
Navigation Path:
Gateway of Tally → Display More Reports → Statements of Accounts → Statistics → Payment
(Shortcut: Press Alt + G → Type 'Statistics' → Drill down into voucher type)
Audit Checkpoint: Check total payment voucher count: 10 entries. Verify Bank balance decreases by ₹4,28,400 and Cash balance decreases by ₹6,200.
🟢 Level 1 – Basic Knowledge & Mechanics (5 Questions)
Q1: Which shortcut key opens Payment voucher in TallyPrime?
Standard Solution & Accounting Treatment:
Press F5.
Press F5.
Q2: What accounts can be selected in the 'Account' field in Single Entry Payment mode?
Standard Solution & Accounting Treatment:
Only Cash or Bank accounts (since payments require monetary outflow).
Only Cash or Bank accounts (since payments require monetary outflow).
Q3: When paying a supplier against a purchase invoice, which bill-wise reference type is used?
Standard Solution & Accounting Treatment:
Agst Ref (Against Reference).
Agst Ref (Against Reference).
Q4: What happens if a user selects an expense ledger in the 'Account' header field in single entry?
Standard Solution & Accounting Treatment:
TallyPrime will not allow it; the header Account must strictly be Cash or Bank.
TallyPrime will not allow it; the header Account must strictly be Cash or Bank.
Q5: Where can you view all cheques issued during the week?
Standard Solution & Accounting Treatment:
Gateway of Tally → Banking → Cheque Register.
Gateway of Tally → Banking → Cheque Register.
🟡 Level 2 – Intermediate Practical Voucher Problems (5 Questions)
Q1: Record settlement of ₹60,000 bill to supplier with ₹2,000 cash discount received via NEFT.
Standard Solution & Accounting Treatment:
Debit: Supplier A/c ₹60,000 (Agst Ref) | Credit: Bank Current A/c ₹58,000 | Credit: Discount Received A/c ₹2,000.
Debit: Supplier A/c ₹60,000 (Agst Ref) | Credit: Bank Current A/c ₹58,000 | Credit: Discount Received A/c ₹2,000.
Q2: Paid electricity bill ₹8,500 and water bill ₹1,200 from cash in a single voucher. Show the entry.
Standard Solution & Accounting Treatment:
Debit: Electricity Expense ₹8,500 | Debit: Water Expense ₹1,200 | Credit: Cash in Hand ₹9,700.
Debit: Electricity Expense ₹8,500 | Debit: Water Expense ₹1,200 | Credit: Cash in Hand ₹9,700.
Q3: Paid advance ₹25,000 to vendor for custom machinery fabrication. How is this recorded?
Standard Solution & Accounting Treatment:
F5 Payment → Debit Vendor A/c → Select 'Advance' reference → Credit Bank A/c ₹25,000.
F5 Payment → Debit Vendor A/c → Select 'Advance' reference → Credit Bank A/c ₹25,000.
Q4: Paid annual fire insurance premium ₹36,000 by cheque on 1st October for 1 year. Show the payment entry.
Standard Solution & Accounting Treatment:
Debit: Insurance Expense A/c ₹36,000 | Credit: Bank A/c ₹36,000. (Year-end prepaid adjustment is made on 31st March).
Debit: Insurance Expense A/c ₹36,000 | Credit: Bank A/c ₹36,000. (Year-end prepaid adjustment is made on 31st March).
Q5: How do you print a cheque directly from the Payment voucher in TallyPrime?
Standard Solution & Accounting Treatment:
Press Ctrl+P while saving the payment voucher (or enable 'Print cheque after saving voucher' in Bank Ledger configuration).
Press Ctrl+P while saving the payment voucher (or enable 'Print cheque after saving voucher' in Bank Ledger configuration).
🔴 Level 3 – Job & Industry Audit Scenarios (5 Questions)
Q1: A supplier offers 3% cash discount if payment is made within 10 days. The bill amount is ₹2,50,000. Calculate net payment and record in Tally.
Standard Solution & Accounting Treatment:
Discount = 3% of ₹2,50,000 = ₹7,500. Net Payment = ₹2,42,500. Entry: Debit Supplier A/c ₹2,50,000 (Agst Ref); Credit Bank A/c ₹2,42,500; Credit Discount Received A/c ₹7,500.
Discount = 3% of ₹2,50,000 = ₹7,500. Net Payment = ₹2,42,500. Entry: Debit Supplier A/c ₹2,50,000 (Agst Ref); Credit Bank A/c ₹2,42,500; Credit Discount Received A/c ₹7,500.
Q2: Explain how statutory payment of GST liability is processed in Payment Voucher.
Standard Solution & Accounting Treatment:
In F5 Payment screen, press Alt+S (Stat Payment) → Select Tax Type: GST → Period: April 2026 → Debit: CGST & SGST Duty Ledgers → Credit: Bank A/c via electronic cash ledger.
In F5 Payment screen, press Alt+S (Stat Payment) → Select Tax Type: GST → Period: April 2026 → Debit: CGST & SGST Duty Ledgers → Credit: Bank A/c via electronic cash ledger.
Q3: A cheque of ₹45,000 issued to vendor was cancelled before delivery. How is it treated in TallyPrime?
Standard Solution & Accounting Treatment:
Open Banking → Cheque Register → Select the cheque leaf → Press Alt+S (Set Status) → Mark as 'Cancelled'.
Open Banking → Cheque Register → Select the cheque leaf → Press Alt+S (Set Status) → Mark as 'Cancelled'.
Q4: Can a Payment voucher be recorded without selecting a party name?
Standard Solution & Accounting Treatment:
Yes, for cash expenses like Postage, Freight Inward, Office Tea, or Traveling Expenses.
Yes, for cash expenses like Postage, Freight Inward, Office Tea, or Traveling Expenses.
Q5: What is the difference between Payment voucher (F5) and Contra voucher (F4)?
Standard Solution & Accounting Treatment:
Payment involves an expense or third-party liability settlement; Contra is strictly an internal transfer between cash and bank accounts.
Payment involves an expense or third-party liability settlement; Contra is strictly an internal transfer between cash and bank accounts.
⚡ Industry Challenge Scenarios (2 Complex Cases)
Challenge 1: Paid showroom rent of ₹60,000 to landlord after deducting 10% TDS under Section 194I by bank transfer. Show the complete voucher entry.
Detailed Professional Solution:
Debit: Rent Expense A/c ₹60,000 | Credit: TDS on Rent Payable u/s 194I ₹6,000 | Credit: Bank Current A/c ₹54,000.
Debit: Rent Expense A/c ₹60,000 | Credit: TDS on Rent Payable u/s 194I ₹6,000 | Credit: Bank Current A/c ₹54,000.
Challenge 2: A business repays bank loan installment: Principal ₹40,000 and Interest ₹8,500 via auto-debit. Pass the entry in F5.
Detailed Professional Solution:
Debit: Bank Loan A/c (Liability reduction) ₹40,000 | Debit: Interest on Loan A/c (Finance Cost) ₹8,500 | Credit: Bank Current A/c ₹48,500.
Debit: Bank Loan A/c (Liability reduction) ₹40,000 | Debit: Interest on Loan A/c (Finance Cost) ₹8,500 | Credit: Bank Current A/c ₹48,500.
11. Practical Company Simulation Scenario
🏢 Company Case Study: Sharma Enterprises Pvt. Ltd.
Financial Year: 01-Apr-2026 to 31-Mar-2027 | Location: Delhi (State Code: 07)
Starting Balances: Cash in Hand ₹75,000 | State Bank of India ₹3,50,000 | Capital ₹5,00,000 | Anil InfoTech (Creditor) ₹1,27,500 | Deepak Creation (Debtor) ₹1,55,000
Dated Transaction Schedule for TallyPrime:
- 01-Apr-2026: Settle pending payment to Anil InfoTech of ₹1,27,500 against Bill # P-106 via SBI Bank cheque # 500101.
- 02-Apr-2026: Collect ₹1,55,000 from Deepak Creation against Bill # 102 deposited directly into SBI Current Account.
- 04-Apr-2026: Execute transaction for Payment Voucher (F5) valued at ₹45,000.
- 07-Apr-2026: Paid monthly shop rent ₹25,000 by cheque and stationery ₹2,400 in cash.
- 10-Apr-2026: Audit voucher postings in Day Book and confirm that no entries remain unallocated.
12. Expected Reports & Verification Keys
| Voucher Type | Debit Account | Credit Account | Amount (₹) | Audit Verification Key |
|---|---|---|---|---|
| F5 / F6 / F7 | Target Expense / Asset A/c | Bank / Cash / Creditor | ₹45,000.00 | Reflected in Day Book & Statistics register |
13. Common Mistakes & How to Avoid Them
❌ WRONG: Executing Payment Voucher (F5) under incorrect ledger group in TallyPrime
✅ CORRECT: Verify group classification in Chart of Accounts before recording entry
❌ WRONG: Omitting narration and source document reference numbers
✅ CORRECT: Always input invoice, challan, or cheque numbers in the narration field
❌ WRONG: Failing to select bill-wise reference details for debtor/creditor entries
✅ CORRECT: Always allocate against specific bill numbers to avoid 'On Account' ambiguity
❌ WRONG: Recording transactions without verifying applicable GST/TDS rates
✅ CORRECT: Confirm tax rates against latest CBIC notifications or party PAN status
❌ WRONG: Bypassing bank date allocation during reconciliation
✅ CORRECT: Input actual date from bank passbook statement to preserve BRS accuracy
14. Job-Oriented Interview Questions & Answers
Basic Interview Questions
1. What is the role of Payment Voucher (F5) in financial accounting? ▾
2. Which menu in TallyPrime provides access to Payment Voucher (F5)? ▾
3. Why is accurate source documentation mandatory for this topic? ▾
4. How does TallyPrime prevent unbalanced entries here? ▾
5. What is the consequence of selecting the wrong ledger group? ▾
Practical Interview Questions
1. Explain the step-by-step Tally procedure to configure Payment Voucher (F5). ▾
2. How do you verify that Payment Voucher (F5) has been correctly posted? ▾
3. Which shortcut key is most vital when executing this task? ▾
4. How do statutory taxes integrate with Payment Voucher (F5)? ▾
5. What report is reviewed by management to inspect this area? ▾
Scenario-Based Interview Questions
1. Your auditor notices a mismatch in Payment Voucher (F5) during year-end finalization. How do you resolve it? ▾
2. A client requests an instant statement for Payment Voucher (F5). How do you generate it? ▾
3. An entry for Payment Voucher (F5) was recorded with the wrong date. How do you correct it? ▾
15. Examination & Knowledge Assessment
16. Quick Revision & Key Takeaways
⚡ Essential Points to Remember:
- Core Concept: Payment Voucher (F5) is an essential component of Recording & Maintaining Accounting Transactions, providing structured operational procedures to ensure commercial compliance and financial clarity.
- Accounting Law: Every transaction impacts at least two accounts in opposite directions (Dr = Cr).
- Master Navigation: Gateway of Tally → Vouchers or Masters → Save with
Ctrl + A. - Audit Verification: Always cross-reference Day Book postings against physical source bills.
- Compliance Focus: Adhere strictly to Indian Accounting Standards and GST/TDS provisions.
💡 Golden Takeaway: Always audit your entries before closing the day. Accurate bookkeeping today prevents severe audit and tax liabilities tomorrow!
17. Calculation Formulas & Logic
📐 Applicable Formula:
Financial Equilibrium: Total Debits (Dr) = Total Credits (Cr) | Net Value = Gross Amount - Discounts + Applicable Taxes
18. Practical Execution Checklist
Daily Practical Task Milestones (Saved in Browser)
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