hi
our client purchase goods from a company which will provide us some amount in the month end as scheme/incentive. whether we are required to reverse vat input on these amount despite of fact we have not recd any credit note from the supplier.
Thanks in Advance
Mr Jagdeep Singh,
You can't make any reverse entry in your accounts and also file any revised return in this connection till you receive cash benifit as per their scheme.........mjk
Sir
if the company auto credited our account by incentive .whether the amount treated as cash incentive ? now we are required to reverse the input or not?
Mr Jagdeep Singh,
It depends on how you account the incentive received by your client.If you make entries in purchaase account similar to purchase returns,showing reduction in value and tax payments then you have to reverse the input tax credit claimed earlier or now. You may also treat the incentive as other income in P&L a/c,wherein it is not necessary to reverse the input credit.......mjk
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