13 February 2010
If VAT collected is credited separately to VAT account and payments thereof are debited in the same account, they would not be included in the turnover. Pl see page 8 of ICAI publication "Issues on Tax Audit" June,2000 edition.
13 February 2010
For discount, there are three types of discounts: (i) Discount allowed in the sales invoice will reduce the sale price and, therefore, the same can be deducted from the turnover. (ii) Cash discount otherwise than that allowed in a cash memo/sales invoice is in the nature of a financing charge and is not related to turnover. The same should not be deducted from the figure of turnover. (iii) Turnover discount is normally allowed to a customer if the sales made to him exceed a particular quantity. This being dependent on the turnover, as per trade practice, it is in the nature of trade discount and should be deducted from the figure of turnover even if the same is allowed at periodical intervals by separate credit notes.
13 February 2010
If sales tax are included in the sale price, no adjustment in respect thereof should be made for considering the quantum of turnover. If, the sales tax recovered are credited separately to Sales tax Account (being separate accounts) and payments to the authority are debited in the same account, they would not be included in the turnover.
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