44ad

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 September 2013 Dear Sir,
Suppose sale is Rs. 100/- and VAT charged thereon is Rs. 5/- and grand total is Rs. 105/-.

If I calculates 8% profit on Rs. 105/-, then whether it would not amount to double taxation on the VAT amount of Rs. 5?

CA Pallav Singhania

CA Pallav Singhania (Expert)
Follow

12 September 2013 1st reduce the VAT from 105 by back calculation..

105-5= 100

then
if profit is 8 percent on sale then 10.86 percent on cost..

10.86 percent of sale, i.e 10.86 is the profit..

89.14 is the cost

CA Pallav Singhania

CA Pallav Singhania (Expert)
Follow

12 September 2013 However, you already mention that the sale price is 100.. then how could you charge profit on sale price??

Cost + Profit = Sale Price

Upgrade to CAclubindia Pro. Subscribe Now!