Tax Audit using Tally MCP and Claude AI
Everything you need for the session, with direct downloads. Please finish steps 1 to 4 before you come.
Before the session
1TallyPrime 7.1
Install TallyPrime 7.1 on a Windows PC. Educational mode is fine for practice. Open a practice company before you start.
On that page choose TallyPrime 7.1 and use the "Download from desktop or laptop" button. Tally does not give a fixed installer link.
2Claude desktop app, with a paid plan
Install the Claude desktop app for Windows and sign in. Claude Code lives in the Code tab of this app, and it needs a paid plan (Pro or higher).
If the first button does not start a download, use the Microsoft Store button.
3Node.js and Python
The Tally connector needs Node.js. Python is needed for the Excel reports. Run both installers and keep the default options. In the Python installer tick Add python.exe to PATH.
4Tally MCP package and setup file
Download the zip and extract it to C:\TallyMCP (a folder with no spaces in its name). Then open Claude Code in a new chat, paste the whole of file 01, and press Enter. Claude Code connects your PC to Tally step by step. When it says "Tally MCP is connected", you are ready.
Keep TallyPrime open with a company loaded while you do this.
5Tax audit draft file (used in the session)
File 02 tells Claude how to prepare draft Form 3CD clauses in an A4 print-ready Excel file, and a list of audit observations, for financial year 2025-26. We will use it in the session. You can download it now.
Keep ready in one folder (practice or changed-name data only)
- Last year's audited financial statements, tax audit report (Form 3CA or 3CB with Form 3CD) and ITR.
- Form 26AS, TIS and AIS for the year, downloaded from the income tax portal.
- Pre-filled data of the current year ITR and tax audit form from the income tax portal.
- Constitution documents. For an LLP or firm: the agreement or deed and any supplementary deed. For a company: Memorandum and Articles, and the latest list of directors and shareholders.
- Bank statements for the full year for every account (Excel or CSV is best, PDF is acceptable).
- TDS returns and challans, GST returns (GSTR-1, GSTR-3B) and GSTR-2B if available.
- Fixed asset purchase dates and the list of MSME (Udyam) suppliers, if the client has them.
What you should know
- Basic Tally navigation: ledgers, groups, vouchers, reports.
- Form 3CD clauses we will cover: 13, 14, 18, 20(b), 21, 23, 26 (with 43B(h)), 27, 31, 32, 34, 35, 40 and 44.
- Sections 40(a)(ia), 40(b), 40A(2), 40A(3), 43B(h), 78 or 79, 269SS, 269T and 269ST.
Rules and data handling
- Tally data is read on your own PC. The Tally connector only reads data. It never posts or changes a voucher.
- Whatever you type or paste into Claude goes to your own Claude account. Nothing is uploaded to this website.
- AI helps find issues. The CA who signs the report is responsible for every finding.
- Check every figure Claude gives against the Tally voucher before you put it in a working paper.
- The practice work is for learning only.
Need help?
Contact CA Meet Dhrangadhariya:
- Phone and WhatsApp: 73839 99929
- Email: meet@csmllp.in
- Website: meet.csmllp.in