Dear Sir,
One of my client is charging MVAT on freight charges in the tax invoice. I have some confusion - should we charge VAT on freight amt which we are showing seperately in the same Invoice? Also under which gruoup will it (freight & packaging) come I mean under Sales account or direct incomes.
Awaiting for your reply.
Thanks & Regards,
Santosh
| Originally posted by :Santosh | ||
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Dear Sir, Vat covered only the cost of the goods sold not to freight, packing etc., Therefore the freight and packing charges not included in the vat. This may shown in the invoice ofter the vat amount in seprately. The freight and other charges are other income only. |
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| Originally posted by :Sathishkumar | ||
| " | Originally posted by :Santosh " Dear Sir, Vat covered only the cost of the goods sold not to freight, packing etc., Therefore the freight and packing charges not included in the vat. This may shown in the invoice ofter the vat amount in seprately. The freight and other charges are other income only. One of my client is charging MVAT on freight charges in the tax invoice. I have some confusion - should we charge VAT on freight amt which we are showing seperately in the same Invoice? Also under which gruoup will it (freight & packaging) come I mean under Sales account or direct incomes. Awaiting for your reply. Thanks & Regards, Santosh "thank you very much sir |
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If you read the definition of "sale price" as defined in your State VAT Act, it is clearly stated that VAT will be charged on this amount. It is not relevant whether you show it separately or not. Before the introduction of VAT, "sale price" is to include essentially the pre-delivery charges. When it was post delivery, there would not be ant tax. The same is still valid for CST. But, VAT Act, is specific about freight charges.
| Originally posted by :Santosh | ||
| " | Originally posted by :Sathishkumar " Originally posted by :Santosh " Dear Sir, Vat covered only the cost of the goods sold not to freight, packing etc., Therefore the freight and packing charges not included in the vat. This may shown in the invoice ofter the vat amount in seprately. The freight and other charges are other income only. One of my client is charging MVAT on ocean freight charges in the tax invoice. I have some confusion - should we charge VAT on freight amt which we are showing seperately in the same Invoice? Also under which gruoup will it (freight & packaging) come I mean under Sales account or direct incomes. Awaiting for your reply. Thanks & Regards, Santosh "thank you very much sir" |
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hey thanks for the information..
really appreciate..
I agree with Mr. Satishkumar, go ahed
By defining Freight Charges as an inventory item enables the AutoAccounting to treat this item as a Freight item and use freight Account rather than Revenue Account for the Freight Charges. If you are not implementing Oracle Order Entry than you can always pick this new item as a line and Oracle Receivables will calculate the Tax on this freight item as it does for any other item. Intermodal Services...
on how much amount of sale the vat amount should shown seprateley
If somebody have a formate of hotel industry . Please Provide me. I will very thankful
Please refer to the latest Supreme Court judgement in India Meters case. The freight and insurance are part of the sale price and hence VAT is leviable on the same, whether it is charged separately or not. Hence please read again.
Dear sir
can i take vat on freight amount ?
which act is describe this provision,
PLEASE CLEAR ME , WHETHER I HAVE TO CHARGE VAT ON P&F OR NOT. AND THE SAME THING IN CST ?
YOUR REPLY WILL BE HIGHLY APPRECIATE !
Chargeable of VAT on Freight Charges is based on contract If Sellers Obligation is to transfer property in goods at Factory Place, no need to charge vat on Freight Charges. If Sellers Obligation is to transfer property in goods at Buyers Place, Vat need to charge on Freight Charges.
Dear Santosh
If seller's obligation is handing over goods to buyer at factory place, but however seller is providing Transport Service and collecting Freight Charges from buyer , here freight charges are treated as Direct Income.
If The contract between the assessee and its purchaser specifically stipulated that the sale was not completed at the factory gate and the transfer of property in the goods would take place at the establishment of the buyer,under an obligation to transport the goods to the place of the buyer and transfer of property in the goods took place only at the establishment of the buyer, the Supreme Court held, that the freight charges recovered by the seller from the buyer would form part of the sales turnover.
If any wrong in my arguement please rectify me.
vat is charged on cost of good sold not for packing and freight charges. same is applicable of cst
Dear Deepak Please go through the attached file and give reply.
CAclubindia
