we have purchased machinery for100000/- (net amount) VAT charged by party5000/- & total cost of machinery including VAT105000/-. Now my question is can we claim VAT set off of5000/- then by what amount i should book my fixed asset.
3 Replies
Pankaj Arora
(Learner)
(3134 Points)
Replied 03 February 2011
you have to book machinery amount excluding vat amt. in fixed assets.
Rajendar Pareek
(Working)
(41 Points)
Replied 25 February 2011
For Capital goods you cannot claim 100% Vat set off, a certain is only allowed for Setoff. They % may vary from State to State, so you have to book the machinery with Machinery Value + VAT which is not allowed to be setoff.
Mandar Deshmukh
(Article Assistant)
(78 Points)
Replied 09 March 2011
The Total cost incurred to purchase the machinery is Rs.105000/- hence full amount should be capitalised even though a part amount of vat paid can be setoff. Refer AS-10.
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