Discount Provisions for SAles TAx

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Amit Sancheti (Querist)
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20 May 2010 Hello...

I need clarification as to what kind of discount is deductible for computing the assessable value of sales under sales tax.

Does Discount given to the party for rate differences at a later stage be treated as discount and also may it be treated as Sales return?

Hope to receive fruitful reply as always

Thanks

CA Archana

CA Archana (Expert)
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20 May 2010 Hi Amit,
Your query has two main parts.First one is on discounts....so any discount given of Invoice like trade/cash discount is to be accounted for sales tax calculation.

Secondly Price/rate difference can not be a discount while it should be treated as a credit/debit note(should be issued to the party) which can be claimed in the sales tax return later on.

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Amit Sancheti

Amit Sancheti (Querist)
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20 May 2010 Thanks Archana for the reply.

However i am still not clear -

Will the credit note recived later on
( say in another quarter ) be reduced from the assessable value and the sales tax liability will be reuced or ?????

Thanks once again for the last answer.

CA Archana

CA Archana (Expert)
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20 May 2010 Yes,I think it can be claimed in the same assessment year.In case u filed the return and then you receives the DN.CN then you can revise the return too showing these in the return

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