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Confusion In S.T

pravanjan mishra (Accountant) (53 Points)

03 December 2009

Need help of any Proffasional.......................

Sir,

We are IT Dealer for Microsoft.We currently get bill from National Disti Like INGRAM & REDINGTON.But the Service Tax Rate is differ for both.Ingram Shown in his bill (Basic value excluding VAT X 10.3% Service Tax) .Redington Shows in his invoice (Basic Value+Vat @ 4%) X 10.3% ,means service tax on net value after tax.

Plz help me which is right .Also stated how we can entered the Purchase INV in Tally.weather we need to registered in service tax.Or how we can shows those Service tax value in purchase entery.

Plz suggest.

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6 Replies

pravanjan mishra (Accountant) (53 Points)
Replied 04 December 2009

Originally posted by :pravanjan mishra
"	Need help of any Proffasional....................... Sir, We are IT Dealer for Microsoft.We currently get bill from National Disti Like INGRAM & REDINGTON.But the Service Tax Rate is differ for both.Ingram Shown in his bill (Basic value excluding VAT X 10.3% Service Tax) .Redington Shows in his invoice (Basic Value+Vat @ 4%) X 10.3% ,means service tax on net value after tax. Plz help me which is right .Also stated how we can entered the Purchase INV in Tally.weather we need to registered in service tax.Or how we can shows those Service tax value in purchase entery. Plz suggest.	"

All So plz suggest how we are able to entry by taking the (Basic+VAt+S.T) divided by 1.04 to get the net value of bill or anythings else.

Plz

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neerajkumar(CAFA) (foreign consultant ) (79 Points)
Replied 05 December 2009

dear sir

applicable services tax on services taxable value not included vat because vat & services tax difference taxes . you are right to pay services tax on taxable value of services tax . we should to mention vat and service tax on invoice separately .

pravanjan mishra (Accountant) (53 Points)
Replied 05 December 2009

Originally posted by :neerajkumar(CAFA)
"	dear sir applicable services tax on services taxable value not included vat because vat & services tax difference taxes . you are right to pay services tax on taxable value of services tax . we should to mention vat and service tax on invoice separately .	"

Sir,

so who is right here.I think ingram who show the vat extra on Basic as well as S.Tax 10.3% on Basic then toatling the Basci+Vat+Service Tax to comes in to Net value.Redington Invoice is supoose to be incorrect.

Plz.

Madhukar N Hiregange (Chartered Accountant) (39034 Points)
Replied 09 December 2009

In this transaction there is in my view no possibility of ST at all. It is a a pure Transfer of Property and therefore only VAT should be payable. The large companies are charging both as a measure fo abundant caution and do not care that there is a difficult situation fro the intermediary.

The practical method ( to solve the problem created by Microsoft/ other big vendors) for the intermediary is also to register, avail the credit and pass on the same to the next stage and so on.

In my view there is no ST on VAT nor any VAT on ST.

Askar Ali (Accountant) (22 Points)
Replied 29 October 2010

What is the calcluation of service tax to builders ?

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Ganesh (CA) (111 Points)
Replied 29 October 2010

Dear Pravanjan,

From a calculation perspective, I am of the view that Ingram is charging it right. Service Tax on VAT is not to be charged, as in the case of Redington.

Thanks,

Ganesh.