18 July 2012
Hi. I am a dealer of chemicals. I have a query on VAT.
Item – 1(Chemical) cost Rs. 1000; Input tax CST at 2%, out put VAT at 14.5% - Output VAT = Rs. 145.00 (Bought from a manufacturer and sold to a manufacturer)
Item – 2 (Cooling agent) cost Rs. 100; input VAT 14.5% - Input VAT = Rs. 14.50 (Bought for own consumption to be used as a cooling agent for item 1)
Now, can VAT payable to government be calculated as Out put VAT minus Input VAT? In this case, Rs. 145 – Rs. 14.50 = Rs. 130.50???
Is this correct? Can I adjust VAT for an item that I used for own consumption against the item that I bought and sold?
29 August 2012
vat credit cant be taken on self consumption items. if these items are used as raw material for production of final salable product than vat credit can be taken.
CAclubindia
