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Vat & cst registration

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BVSPRAO

Propreitor

21 Points Posted on 22 April 2015

I'm starting small whole sale pharma business in Hyderabad,Telangana. I'm getting stocks from Chandigarh and Himachal pradesh from Different comapnies in small quantities like Rs.20,000 in every 2 months. from 2,3 comapnies. As the VAT 5% + CST (4%+1% or 2% with C form), shall I register for VAT &CST( to get C forms). As it is new start up my turn over expected in first 6 months 3-4 lakhs and next 6 months 7-8 lakhs.( total yearly turnover may be 10-12 lakhs.

1. After registration of VAT, how can I charge vat from my customers. As the VAT paid be me in another state, how can charge and file vat in Hyderabad.

2. As I'm sourcing from more companies in small quantities, is it possible to get more C forms to give it to each comapany and how can I recover my CST from customers?

Replies (1)

CMA Poornima Madhava

CMA

9106 Points Posted on 22 April 2015

VAT registration is compulsory if taxable turnover exceeds ₹10 lacs (unless Telagana has different limit), till then no need to register I think.
But if you wish to transact interstate purchases using C form, then u need to register for VAT as well as CST (single registration for both I think)
Since you will be purchasing from outside the state (if registered under CST), tax payable would be 1 or 2% (as applicable) with C form. In any case, you shall not be permitted to take credit of CST (whether with/without C form). CST that you pay is only your expense which cannot be set off against VAT that you might charge locally even if registered under VAT.
Suppose you register under CST/VAT, you pay CST @ 1 or 2% (as applicable) and charge VAT on sales ( @ local rates) as applicable.
You can get any number of C forms provided you purchase it from registered dealers.