Sales Tax on Warranty

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VAIBHAB JAIN (Querist)
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27 November 2010 An authorized service station of car provide service to customer, but the spare parts which are replaced under warranty provided free of cost to customer and the same is recovered from the supplier

whether sales tax will charge to supplier on recovery amount

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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27 November 2010 Yes, It is a sale transaction, only the amount is receivable from a supplier due to warranty. so VAT is applicable

VAIBHAB JAIN

VAIBHAB JAIN (Querist)
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30 November 2010 But supplier has been returned only the cost of the part not the selling price

VAIBHAB JAIN

VAIBHAB JAIN (Querist)
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01 December 2010 Also i want to know what tax planning we can do to save the tax
can we show as agent and principal transaction

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