We are charging freight from our customers for the material supplied to them. This freight may be more than or less than the actual amount incurred by us for transporting the goods to customer.
Please guide me w.r.t. the applicability of taxes on freight...VAT or Service Tax.
Note:Goods are sent by Courier as well as road transport.
24 July 2012
First, their is no VAT on freight , if charged separately. Secondly, the service tax is applicable on service of Goods Transport Agency, so the Service Tax would be applicale on the bill amount of the Transport agency and not on your inflated freight value.
26 July 2012
for Service Tax See NN 26/2012, which talk about services of goods transport agency and for Sales/Vat read definition of Sale u/s 2(h) of CST Act.
29 July 2012
Mr Pankaj Arya, Sorry,Iwould like to differ a bit,freight is not exempt from VAT in most of the States. You have to add freight to the price of goods while collecting VAT/CST....MJK
CAclubindia
