Can we charge the CST and VAT for warranty replacement for traded and MFG goods,
Raghavendra K K (Accounts Assistants ) (25 Points)
04 July 2016Can we charge the CST and VAT for warranty replacement for traded and MFG goods,
CMA Poornima Madhava
(CMA)
(13097 Points)
Replied 04 July 2016
No VAT/CST is applicable in case of warranty replacement, free samples etc, that is where there is no consideration involved.
Raghavendra K K
(Accounts Assistants )
(25 Points)
Replied 04 July 2016
can you please briefly explain?
CMA Poornima Madhava
(CMA)
(13097 Points)
Replied 04 July 2016
Cost of warranty is generally included in the original price of goods and hence there is no need to charge tax again on warranty replacement as such transactions are not regarded as sale. Hope this is clear.
"Live class on Python for Financial Analysis: Unlocking Efficiency in Accounting and Finance"
CAclubindia
