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VAT ON FREIGHT AMT

IPCC, Asst Manager


Dear Sir,

One of my client is charging MVAT on freight charges in the tax invoice. I have some confusion  - should we charge VAT on freight amt which we are showing seperately in the same Invoice? Also under which gruoup will it (freight & packaging) come I mean under Sales account or direct incomes.

Awaiting for your reply.

Thanks & Regards,

Santosh

 

 
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Originally posted by :Santosh
"

Dear Sir,

Vat covered only the cost of the goods sold not to freight, packing etc.,

Therefore the freight and packing charges not included in the vat. This may shown in the invoice ofter the vat amount in seprately.

The freight and other charges are other income only.
One of my client is charging MVAT on freight charges in the tax invoice. I have some confusion  - should we charge VAT on freight amt which we are showing seperately in the same Invoice? Also under which gruoup will it (freight & packaging) come I mean under Sales account or direct incomes.
Awaiting for your reply.
Thanks & Regards,
Santosh
 

"


 

 
Reply   
 


IPCC, Asst Manager


Originally posted by :Sathishkumar
"


Originally posted by :Santosh


"

Dear Sir,
Vat covered only the cost of the goods sold not to freight, packing etc.,
Therefore the freight and packing charges not included in the vat. This may shown in the invoice ofter the vat amount in seprately.
The freight and other charges are other income only.
One of my client is charging MVAT on freight charges in the tax invoice. I have some confusion  - should we charge VAT on freight amt which we are showing seperately in the same Invoice? Also under which gruoup will it (freight & packaging) come I mean under Sales account or direct incomes.
Awaiting for your reply.
Thanks & Regards,
Santosh
 

"thank you very much sir




 
"


 

 
Reply   
 

If you read the definition of "sale price" as defined in your State VAT Act, it is clearly stated that VAT will be charged on this amount. It is not relevant whether you show it separately or not. Before the introduction of VAT, "sale price" is to include essentially the pre-delivery charges. When it was post delivery, there would not be ant tax. The same is still valid for CST. But, VAT Act, is specific about freight charges.

 
Reply   
 

Originally posted by :Santosh
" Originally posted by :Sathishkumar
"

Originally posted by :Santosh

"
Dear Sir,
Vat covered only the cost of the goods sold not to freight, packing etc.,
Therefore the freight and packing charges not included in the vat. This may shown in the invoice ofter the vat amount in seprately.
The freight and other charges are other income only.
One of my client is charging MVAT on ocean freight charges in the tax invoice. I have some confusion  - should we charge VAT on freight amt which we are showing seperately in the same Invoice? Also under which gruoup will it (freight & packaging) come I mean under Sales account or direct incomes.
Awaiting for your reply.
Thanks & Regards,
Santosh
 
"thank you very much sir"
"

 

hey thanks for the information..

really appreciate..

 
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I agree with Mr. Satishkumar, go ahed

 
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By defining Freight Charges as an inventory item enables the AutoAccounting to treat this item as a Freight item and use freight Account rather than Revenue Account for the Freight Charges. If you are not implementing Oracle Order Entry than you can always pick this new item as a line and Oracle Receivables will calculate the Tax on this freight item as it does for any other item. Intermodal Services...

 
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on how much amount of sale the vat amount should shown seprateley 

 

 

 

 

 

 
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If somebody have a formate of hotel industry . Please Provide me. I will very thankful

 
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Please refer to the latest Supreme Court judgement in India Meters case. The freight and insurance are part of the sale price and hence VAT is leviable on the same, whether it is charged separately or not. Hence please read again.

 
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