vat applicability

This query is : Resolved

venkat (Querist)
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07 November 2007 could the vat be charged on the freight mentioed in the purches bill.
the purchase order was given freight exclusive.

ASHISH YADAV

ASHISH YADAV (Expert)
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08 November 2007 Dear Vanket

The frieght charges should not be included for Vat.

Vat will be computed only for goods invoiced. i invoice u have to mention

Goods ---amount
Add:- Vat

The frieght paid on this will go to the frieght outward cost in ur Books.This is ur indirect cost.

Ravi Shankar

Ravi Shankar (Expert)
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08 November 2007 Mr. Venkat,

If the freight is charged separately to the purchaser in the bill, VAT can NOT be charged by the supplier on the freight portion.

However, if freight forms part of the selling price and is not mentioned separately in the invoice, VAT ought to be charged on the entire amount (without splitting for goods and freight portions).