23 November 2009
Hi Sanjay, VAT is payable only if the turnover exceeds Rs. 5 lakhs. Suppose in the first year, the turnover is 7 lakhs than on excess Rs. 2,00,000 VAT is payable. but in the second year, VAT will be applicable from day 1 as the last years turnover was above Rs. 5 lakhs eventhough your second years turnover is say 3 lakhs. further in the third year, since second year's turnover is less than Rs. 5 lakhs, no VAT is charged upto Rs. 5 lakhs. Regards, CA Shakuntala Chhangani
CAclubindia
