Our supplier is making us invoice in the following format
Gross Amt. 100
Vat 4
Total 104
Discount 4
Net Invoice Amt. 100
Now please suggest me whether at the time of booking of invoice, we should change vat amount in proportion of discount amount also as discount is given on total amount inclusive of VAT.
Gross amount - 100 less dicount 4 balance 96 VAT @ 4% is the correct method. VAT is on the final sale price.
vat can not efect on discount becose vat on value of matarials if we give discount on value principaly value down and vat on value thus van can not efect direct or indirec on discount discount
hi Pradeep
I am agree above all answer. you are doing right but it is not proper way you have to book vat amt. what is written on invoice.You suggest to party pls give discount before vat calculation. This is right way.
CAclubindia
