Chartered Accountant
1489 Points
Joined August 2011
@ Naveen :
In case of hotelier or hotel business generally composition scheme @ 5 % is applicable on the turnover of sales .
In the instant case the hotelier is opting composition as well as normal scheme of VAT and so VAT SET OFF should be reduced on a proportionate basis as there is no set off available in case if a dealer opts for a composition scheme ..
An appropriate method for reducing the set off on a proportionate bais would be :
STEP 1 : Take the total of the turnover of both the kind of sale
STEP 2 : Express a percentage of turnover of breakfast with the total turnover
STEP 3 : Apply this percentage on the set off of the goods purchased and that will be the set off of the chargeable breakfast
Ok ...