Transition provisions - b/f of itc undet vat
This query is : Resolved
09 May 2017
We have been purchasing materials on 5% VAT Input and sell them on 2%CST against form C basis.
As a result over the years we have accumulated Vat Input Tax Credit.
I understand that the entire amount of Input Tax Credit will become the opening balance of SGST Account. We will not have any closing stock but we will have a handsome balance in the VAT Input Account.
Is my understanding correct about the transition provisions ? Will there be a problem incase I dont have closing stock but balance in the VAT Input Account due to the nature of business ?
As a result over the years we have accumulated Vat Input Tax Credit.
I understand that the entire amount of Input Tax Credit will become the opening balance of SGST Account. We will not have any closing stock but we will have a handsome balance in the VAT Input Account.
Is my understanding correct about the transition provisions ? Will there be a problem incase I dont have closing stock but balance in the VAT Input Account due to the nature of business ?
09 May 2017
There will not be any problem in your case. Because of your nature of business you have credit which could not be use for output tax liability. If you have proper record of stock then there is no problem.
But you have to follow Section 140 and Transitional Provision Rules.
If you want to know more about the transitional provision then check out my Youtube channel about GST
Link is here: https://www.youtube.com/channel/UC8jPSKGjS83wRC1XQ56dwAg
But you have to follow Section 140 and Transitional Provision Rules.
If you want to know more about the transitional provision then check out my Youtube channel about GST
Link is here: https://www.youtube.com/channel/UC8jPSKGjS83wRC1XQ56dwAg
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