Set-off of vat on car purchased

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Alpesh (Querist)

03 April 2012 Dear Sir / Madam,

When the professional tax liablity occur deducted from salary for the month of April - 2011. if payment made in May. & when shall i make a provision in accounts of prof.tax.
in the Month of April or May ?

&
What is the due date of profession tax deducted from on salary employee?

Querist : Anonymous

Querist : Anonymous (Querist)

03 April 2012 Dear Sir,
We purchased a car on which we paid VAT which was shown in TAX Invoice. Is it possible to take set off of VAT paid on car while paying our VAT Liability under Maharashtra VAT Act. We are also claiming depreciation in IT Return.

NILESH MANDOLE, MBA (Fin),CS

NILESH MANDOLE, MBA (Fin),CS (Expert)

03 April 2012 FOR CAR, YOU ARE THE END USER. SO YOU WILL NOT GET IT.

Anand Agarwal

Anand Agarwal (Expert)

03 April 2012 Under MVAT, set off on vehicle is not allowed except vehicle used in business such as delivery van, crane etc.

CA CS Pawan Jajoo

CA CS Pawan Jajoo (Expert)

04 April 2012 PT is to be paid on the last day of the month/qtr to which the return relates.

For yearly payment its 31.03.

https://www.mahavat.gov.in/Mahavat/TaxCalender.jsp

Alpesh

Alpesh (Querist)

04 April 2012 Thanks Sir,
But In accounts when i have to make a provision of P.T. in accounts? at the time of Salary Provision or at the time of Payment. exampl. if the salary for the month of April-2011 paying in May-2011.then, in which month i have to pay Prof. Tax in the Month of April or May? Also clear the provision in accounts.

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

25 July 2025 Set-off of VAT on Car Purchased:
Under the Maharashtra VAT Act, the ability to claim a set-off on VAT paid on the purchase of a vehicle depends on the use of the vehicle.

1. Set-off of VAT on Car:
For Personal Use Vehicles: If the vehicle is used for personal purposes, you cannot claim a VAT set-off on the purchase of the car, as you are considered the end user of the vehicle.

For Business Use Vehicles: If the vehicle is used for business purposes (e.g., delivery vans, trucks, etc.), you can claim the VAT paid on the car as input tax credit (ITC) under the Maharashtra VAT Act.

Since you mentioned claiming depreciation in the Income Tax Return, I assume the car is used for business purposes. In that case, you may be eligible for input tax credit (set-off) under MVAT. But, as mentioned earlier, personal use cars do not qualify.

Provision for Professional Tax (PT) in Accounts:
Regarding your question on Professional Tax (PT) and accounting treatment:

When to Make a Provision for PT in Accounts:

Provision for PT should be made in the month when the salary is accrued, i.e., in April when the salary for the month of April is due.

Payment of PT happens later (in May), but the accrual (or provision) should happen when the liability arises, which is in the month of April.

So, the provision should be made in April in the accounts, and the payment is made in May.

When to Pay PT (Professional Tax):

For monthly payment of PT, the due date is the last day of the month following the month in which the salary is paid.

For the month of April, you would need to pay PT by May 31 (for the month of April salary).

For yearly payment, the due date is March 31 (if paying on an annual basis).

Summary:
Set-off of VAT on Car: If the car is used for business purposes, you can claim VAT set-off under Maharashtra VAT Act. If it’s for personal use, no set-off is allowed.

Provision for Professional Tax: Make the provision for PT in April (when salary accrues), even if payment is made in May. The payment due date for April salary is May 31.

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