How to Setup Cost Centers in Tally Prime

For growing businesses, knowing company-wide expenses is not enough. Management needs to know which departments (e.g. Sales, Admin, R&D) or projects (e.g. Mumbai Metro Project, Delhi Airport Project) are incurring costs. Instead of creating redundant ledgers (like "Sales Office Rent", "Admin Office Rent"), you can use Tally's **Cost Centers** to classify expenses under a single "Rent" ledger.

Step 1: Enable Cost Centers in Tally Prime

Activate the cost center module in your company features:

1. Open Tally Prime and press F11 (Features).
2. Under the Accounting section, set Enable Cost Centers to Yes.
3. Press Ctrl+A to save and apply the change.

Step 2: Create Cost Categories & Cost Centers

A **Cost Category** groups related cost centers. For example, the Category is "Departments", and the Cost Centers inside are "Sales", "Marketing", and "Admin".

A. Create a Cost Category

1. Go to Gateway of Tally > Create.
2. Select Cost Category. (Choose **Create New** if prompted).
3. Enter the Name (e.g. "Departments"). Press Ctrl+A to save.

B. Create Cost Centers

1. Go to Gateway of Tally > Create > Cost Center.
2. Select the category you created ("Departments").
3. Enter the Cost Center name (e.g. "Sales Department"). Save.
4. Repeat the steps to add other centers (e.g. "Marketing Department").

Step 3: Allocating Expenses during Voucher Entry

First, ensure cost center tracking is enabled on the target expense ledger:

1. Go to Gateway of Tally > Alter > Ledger > select your expense ledger (e.g. Office Rent).
2. Set Cost Centres are applicable to Yes and save.

Now, when you record a Payment Voucher (`F5`) debiting Office Rent for ₹50,000, Tally will open a popup window:

• Select the Cost Category: **Departments**.
• Select the Cost Center and allocate the amount shares:
  • Sales Department: ₹30,000
  • Marketing Department: ₹20,000
• Save the voucher. Tally will allocate the expenses accordingly.

TrulyInvoice: Intelligent Multi-Department Allocation

When automating invoices or statement syncs, allocating expenses to different projects or departments manually is tedious. TrulyInvoice addresses this:

• Project-Level Mapping: The parsing validator checks transaction keywords and splits costs across designated Tally cost centers automatically.
• Direct Sync: Syncs entries to Tally Prime over a secure Port 9000 connector at a flat subscription of **plans starting at ₹399/month**, bypassing transaction limits.

Frequently Asked Questions