CA Asha (Student) (188 Points)
01 October 2013For a Software services and products company, on what all inputs, can VAT be taken?
Ex: Can VAT be taken on Computer, Computer Hard disks purchased, Software etc though the company's sales basically relate to Software services and few software customised products.
MJ Krishnamurthy
(ACCT(Retd))
(7197 Points)
Replied 01 October 2013
You can avail the input tax of goods(software ) which go into the final product,or materials used in the process of manufacturing it can be availed as input credit......mjk
C.A. Sandeep Wawhal
(CA, PGDFM, BCom)
(1831 Points)
Replied 01 October 2013
Computer Expenses are revenue expenses then full vat available if it is capital expenditure then input credit available after deducting 3% of taxable amount from tax. example if input tax credit is 12.5% then u can avail tax credit only 12.5% - 3% = 9.5% in case of capital expenditure.
CA Asha
(Student)
(188 Points)
Replied 03 October 2013
Thank you for the replies. I have one more question arising out of this.
The company provides software services, but the software purchased by it does not go into the final product. It is more in the nature of software which is necessary for providing service, but does not go into final product. Can Input VAT be taken on such software purchases?
C.A. Sandeep Wawhal
(CA, PGDFM, BCom)
(1831 Points)
Replied 03 October 2013
C.A. Sandeep Wawhal
(CA, PGDFM, BCom)
(1831 Points)
Replied 03 October 2013
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