Regarding tot

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 May 2012 I have started my consultancy indira technologies, my primary area of service is computer troubleshooting, networking and antivirus sale.
I applied for VAT registration and since the past few months i have been submitting zero returns online, my business volume is very low, should i continue with my VAT registration or cancel it.

Amol Gopal Kabra (CA,CS,DISA)

Amol Gopal Kabra (CA,CS,DISA) (Expert)
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05 May 2012 Dont cancel the VAT Registration. Because next time you need it, again same procedure shall be required to be followed. Better, you keep on filing nil returns. Your business will grow sometime. So dont cancel it.

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Querist : Anonymous

Querist : Anonymous (Querist)

23 May 2012 Thank you sir, but can you tell me what is TOT, and what kind of minimum business volume is required to pay this tax.

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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20 July 2025 ure! Here’s a simple explanation regarding TOT and related concerns:

What is TOT?
TOT stands for Tax on Turnover. It is a type of tax levied on the total turnover (gross receipts) of a business, irrespective of profit or loss. Some states in India or some local laws may use this term for a turnover-based tax.

Is TOT different from VAT?
VAT (Value Added Tax) is a tax on the value added at each stage of the supply chain, usually levied on sales of goods.
TOT, if applicable, might be a fixed tax based on turnover without deductions.
In your case (Consultancy business):
Since you are dealing with services like troubleshooting, networking, antivirus sales:
VAT generally applies on sale of goods (like antivirus software if it’s sold physically).
For services, Service Tax (now subsumed under GST) would have applied before GST regime.
TOT usually applies to goods turnover, but it depends on your state/local laws.
About minimum turnover and paying TOT:
Usually, TOT or VAT registration thresholds depend on the state government rules.
If your turnover is below a certain limit (varies by state), you might be exempt from paying VAT or TOT.
But since you have VAT registration already, you should continue filing nil returns until your turnover crosses the threshold or your business picks up.
Canceling VAT registration is not advisable if you plan to resume or grow your business soon.
Summary:
Question Answer
What is TOT? Tax on total turnover (gross receipts), sometimes a fixed or minimum tax in some states
Minimum turnover for TOT Depends on your state laws, varies widely
Should you cancel VAT? No, keep filing nil returns until business grows
Do you pay TOT on low turnover? Usually no, if below threshold; confirm with your local tax office

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