Reversal of credit.
This query is : Resolved
03 December 2008
At the time of Local purchase,we are availing vat credit 4% or 12.5%.When we return the goods thro vat Invoice,we are charging 4% VAT.Should we credit vat credit 4% or 12.5%? i,e,similar treatment as cenvat in excise or can it be adjusted thro purchaes.Can anyone thro light in this matter?
03 December 2008
This illustration should solve ur problem
In VAT,
when you purchase raw material or goods for resale you pay 4% on say 100
Tehn you manufacture or resell it for say 120 and tax the sale at 4%
You will get credit of Rs.4 against your collection of tax of Rs.4.80 You have to pay only .80 to govt. Only your profit or value addition is taxed.
In VAT,
when you purchase raw material or goods for resale you pay 4% on say 100
Tehn you manufacture or resell it for say 120 and tax the sale at 4%
You will get credit of Rs.4 against your collection of tax of Rs.4.80 You have to pay only .80 to govt. Only your profit or value addition is taxed.
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