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tax invoice and tax rate

26 July 2017

i am doing embroidery business purchase cloth which is 5% and make embroidery on cloth and then sell it so i want to know what is the tax rate on it and if i do job work on cloth which is sent by shop keeper then what is tax rate and job work bill made in goods or in service pls kindly clarify this

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5 Replies

Ahmed Ali (388 Points)
Replied 26 July 2017

Please specify in what kind of cloth you are doing business? Tax rates depend on the type of cloth.

Regular Purchase and Sale: If you purchase cloth from a Supplier and sell it to a customer, then you are required to raise Tax invoice for sale of goods. You need to charge GST on the full sale price.

Job Work Basis: But if the shopkeeper sends you cloth for Job work, he shall issue delivery challan to you. After the receipt of cloth you need to perform the embroidery within 6 months and send back the cloth. Now you need to issue Tax invoice only for the Job work charges(not for the full sale price of cloth). You need to charge GST only on the job work charges only.