How to Record Common Financial Transactions in Onsite

Common financial situations that arise on construction projects and how to record them correctly in Onsite. Each scenario includes the transaction type to use and the step-by-step approach.

Scenario 1: GST-Inclusive vs Non-GST Client Payments

Situation: Some clients pay the full invoice amount including GST. Other clients pay only the base amount and your company pays the GST portion on their behalf.

Client pays with GST (standard)

Create the Sales Invoice with full GST applied
Record the full payment received (Payment In) and settle against the invoice
No additional steps needed

Client pays without GST (company absorbs GST)

Create the Sales Invoice with full GST applied as usual. The invoice always reflects the true value.
Record only the base amount as Payment In and settle against the invoice
Record the GST shortfall as a separate Other Expense entry in the same project:
- Amount: GST amount your company is absorbing
- Cost Code: “GST Absorbed” or “GST on Client’s Behalf”
- Notes: Add the client name and invoice reference number

💡 Filter the Company Expense Report by cost code “GST Absorbed” to see the total GST absorbed across all clients in any month.

⚠️ This tracks the cash outflow correctly but does not adjust your GST payable liability account. Your CA will need to pass the correct journal entry in Tally for proper GST filing.

Scenario 2: Company Overhead and Office Expenses (Not Linked to Any Project)

Situation: You have daily or monthly overhead costs (office rent, utilities, stationery, admin salaries) that are not part of any specific project.

Setup (one time only)

Create a dedicated project in Onsite called Head Office or Admin and Overhead. All non-project expenses will be recorded here going forward.

Recording an overhead expense

Open the Head Office project
Go to the Transaction tab
Click + Transaction and select Other Expense
Fill in: date, party name (vendor or payee), amount, and a cost code that categorises the expense (e.g. Office Rent, Utilities, Admin Salary, Internet)
Click Save

Viewing monthly expense totals

Go to Reports
Click Company Expense Report
Filter by Project = Head Office and set the date range to the month you need
The report shows all company-level expenses for that period broken down by cost code

💡 Set up all your cost codes (Office Rent, Utilities, Admin Salary, etc.) in Company Settings before recording expenses. Consistent cost codes make the monthly report clean and filterable. Without them, expenses are lumped together with no breakdown.

⚠️ Do not record office expenses inside project accounts. Mixing overhead costs into project transactions distorts project-level profit and expense reporting.

Scenario 3: Loan EMI and Interest Payments

Situation: Your company has a loan and pays monthly EMIs. Each EMI has two components: principal repayment and interest.

Recording each EMI payment

Record the EMI as two separate Other Expense entries in the Head Office project:

Entry	Amount	Cost Code
Principal repayment	Principal portion of the EMI	Loan Repayment — Principal
Interest	Interest portion of the EMI	Loan Interest

Viewing interest paid for the period

Go to Reports, then Company Expense Report
Filter by Cost Code = Loan Interest and set the date range
The report shows total interest paid for that period

⚠️ Onsite cannot track the reducing loan balance on the liability side. It only tracks the cash outflow (expense). For balance sheet accuracy, your CA needs to maintain the outstanding loan balance in Tally or accounting software.

Scenario 4: TDS Deduction on Vendor or Subcontractor Payments

Situation: Your company deducts TDS before paying a vendor or subcontractor and needs to record the net amount paid and the TDS withheld.

Recording TDS on a Material Purchase, Subcon Bill, or Other Expense

Create the transaction (Material Purchase, Subcon Bill, or Other Expense)
Fill in the full bill amount as Total Amount
Scroll down and click + Deduction
The Deduction panel opens. Select the TDS type from your Deduction Library (e.g. TDS 2%, TDS 10%)
Enter the TDS amount as:
- % of Total to calculate automatically from the total bill amount, or
- Lumpsum to enter a fixed rupee amount
Click Save inside the Deduction panel
The transaction now shows: Total Amount, Deduction (TDS), and Net Amount (amount actually payable to the vendor)
Save the transaction

The Net Amount is the amount you actually pay to the vendor. The TDS deduction is tracked separately.

💡 Set up all your TDS types (TDS 2%, TDS 10%, TDS 1%, etc.) in the Deduction Library before recording transactions. Go to Library in the left sidebar, then Deduction Library, and click + Add Item.

⚠️ Onsite tracks the TDS deduction as a cash-flow entry. It does not automatically calculate TDS liability or generate Form 26Q. Your CA needs to handle TDS filing separately using this data as a reference.

Scenario 5: Advance Payment to a Vendor and Recovery Against Bills

Situation: You pay a vendor or subcontractor an advance before any bill exists, and want to recover it gradually as bills arrive.

Step 1: Record the advance as a Payment Out

Go to the project Transaction tab
Click + Transaction, then Payment Out
Select the vendor, enter the advance amount
Do not settle against any bill at this stage — there are no bills yet
Click Save

The advance sits as an unsettled Payment Out in the vendor’s ledger.

Step 2: When a bill arrives, recover part of the advance

Open the advance Payment Out from the transaction list
Click Edit Settlement
Select the new bill from the list
Enter the recovery amount (e.g. Rs 5,000 out of a Rs 15,000 bill)
Click Save

The bill’s payable amount reduces by the recovered amount. Only the remaining amount needs to be paid in cash.

Repeat Step 2 for each new bill until the full advance is recovered.

Example:

Event	Advance Remaining	Cash Paid
Advance paid: Rs 40,000	Rs 40,000	Rs 0
Bill 1 (Rs 15,000) — recover Rs 5,000	Rs 35,000	Rs 10,000
Bill 2 (Rs 20,000) — recover Rs 15,000	Rs 20,000	Rs 5,000
Bill 3 (Rs 25,000) — recover Rs 20,000	Rs 0	Rs 5,000

Scenario 6: Client Advance and Adjustment Against Future Invoices

Situation: A client pays you an advance before any invoice is raised, and you want to adjust it against future invoices as work progresses.

Step 1: Record the advance as a Payment In

Go to the project Transaction tab
Click + Transaction, then Payment In
Select the client, enter the advance amount
Do not settle against any invoice — no invoice exists yet
Click Save

Step 2: When an invoice is raised, adjust part of the advance

Open the advance Payment In from the transaction list
Click Edit Settlement
Select the invoice from the list
Enter the adjustment amount
Click Save

The invoice’s receivable (To Receive) reduces by the adjusted amount. Only the remaining balance needs to be collected in cash from the client.

Repeat for each new invoice until the advance is fully adjusted.

Scenario 7: Recording Material Returns to a Vendor

Situation: Materials were received from a vendor and a GRN was created, but some or all materials need to be returned.

Recording the return

Go to the project Transaction tab
Click + Transaction, then Material Return
Select the vendor
Click + Add Materials and select the materials being returned from the Material Library
Enter quantities, add GST or discount if applicable
Click Save

The material return reduces the vendor’s outstanding balance and adjusts the stock.

💡 If a Material Purchase invoice was already created for these goods, raise a Debit Note against the vendor after recording the return. The Debit Note reduces the amount payable on the invoice.

Scenario 8: Issuing a Credit Note to a Client

Situation: You raised a Sales Invoice and the client disputes part of the amount, or work was not completed and the invoice value needs to be reduced.

Recording the credit note

Go to the project Transaction tab
Click + Transaction, then Credit Note
Select the client
Click + New Item and enter the item name and the credit amount
Click Save

The credit note reduces the client’s outstanding receivable. It appears as a deduction in the Sales total of the Transaction tab header.

Scenario 9: Releasing Client Retention After Project Completion

Situation: You withheld retention on a Sales Invoice and the project is now complete. The retention is now due to be released to the client (or the client pays the remaining retention amount).

Viewing the outstanding retention

Go to the project Party tab
Search for the client and click on their name
The party balance shows a Client Retention column
Click Client Retention to see all retention entries with due dates and status

Recording the retention release as payment received

When the client pays the retained amount:

Go to the Transaction tab
Click + Transaction, then Payment In
Select the client
Enter the retention amount
Settle against the retention entry in the settlement panel
Click Save

The retention entry moves to Paid status.

Scenario 10: Salary Payments for Staff

Situation: Staff salaries are processed through Payroll, but you also need them to appear in the project’s Transaction tab as an expense.

How it works

When salary is processed and approved in the Payroll module, a Salary Expense entry is automatically created in the Transaction tab for the relevant project. You do not need to create a separate transaction.

The Salary Expense appears in the Transaction tab as an expense line and is included in the Expense total in the header metrics.

If you need to record a one-off salary-related payment

For ad-hoc payments like advance salary or a loan to a staff member:

Go to the Transaction tab
Click + Transaction, then Payment Out
Select the staff member as the party
Enter the amount and select the appropriate cost code (e.g. Advance Salary, Staff Loan)
Click Save

Tips

Set up all cost codes once in Company Settings before recording transactions. Consistent cost codes make expense reports filterable and meaningful. Without them, all expenses appear in one undifferentiated list.
Use the Head Office project for all overhead and non-project expenses. Never record office expenses inside project accounts — this distorts project-level profit reporting.
Share the accounting approach used in Onsite with your CA before the financial year ends. Your CA needs to know what is tracked in Onsite and what journal entries need to be passed separately in Tally.
Deduction Library and Retention Library must be set up before you can apply deductions or retention on transactions. Go to Library in the left sidebar to manage both.
Record advances as unsettled Payment Out entries. Do not try to settle them at the time of recording if no bill exists yet. Settle them gradually as bills arrive.

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