difference between exempted goods and non taxable goods under gst
This query is : Resolved
16 June 2017
dear experts,
what is the difference between exempted goods and non taxable goods?
CA R SEETHARAMAN
(Expert)
16 June 2017
For exempted goods no input tax credit can be taken.
GST zero-rated supply means that the goods and services that fall under this category are not taxed. In other words, they are subject to zero percent tax rate.
Under this category, the taxable company doesn’t need to collect any GST on sales. But the company is most certainly eligible to file a claim for input General and Sales Tax credit on the cost incurred in manufacturing the supplies. Simply stated, GST that is paid on asset, operational cost incurred and purchases for manufacturing goods are claimable as ITC (Input Tax Credit).
In India export of goods and services are zero rated.
GST zero-rated supply means that the goods and services that fall under this category are not taxed. In other words, they are subject to zero percent tax rate.
Under this category, the taxable company doesn’t need to collect any GST on sales. But the company is most certainly eligible to file a claim for input General and Sales Tax credit on the cost incurred in manufacturing the supplies. Simply stated, GST that is paid on asset, operational cost incurred and purchases for manufacturing goods are claimable as ITC (Input Tax Credit).
In India export of goods and services are zero rated.
16 June 2017
nontaxable supply means zero rated supply?
if dealer making zero rated supply then he is not eligible to opt for a composition ?
CA R SEETHARAMAN
(Expert)
16 June 2017
Yes nontaxable supply means zero rated supply. If dealer making zero rated supply then he is not eligible to opt for a composition.
16 June 2017
if composition dealer taxable goods purchased from the unregistered dealer he should pay tax on that good?
CA R SEETHARAMAN
(Expert)
17 June 2017
Not required to pay as he can't claim ITC on it.
17 June 2017
in the case of arecanut business if regular dealer purchase areca from unregistered dealer he will pay for areca Rs.50000+gst 5%+his profit 2%= 53500
if composition dealer purchase from unregister dealer for areca Rs.50000+gst 1%+profit 2%= 51500
as per my opinion composition dealer also payable tax on URD.
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CA R SEETHARAMAN
(Expert)
17 June 2017
If you consider ITC of 5%, Rs.50000+gst 5%+his profit 2%= 53500-2500(ITC)=51500.
You have to change your opinion.
You have to change your opinion.
17 June 2017
but for consumer's it will be more costlier then composition dealer.
CA R SEETHARAMAN
(Expert)
17 June 2017
The difference is very meager.
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