Sir,
We are having a retail shop in Chennai, Tamil Nadu. Our total turnover is just below 10 lakh i.e. nearly nine lakh. We do have TIN number and we pay VAT when we buy goods from the wholesaler. But we are not collecting any tax from our customers (End users). So we use the exempted Sales column while filing VAT return and so input tax credit is not allowable. My question is
1) Is it right to use Exempted Sales column for this purpose or is it for the Tax Exempted goods only?
2) Is it mandatory for a retailer to collect tax even though doesn't want the Input Tax Credit?
3) If above two are not right, then please suggest a way to avoid collecting tax from customers and how the VAT return form should be filed for that purpose.
These questions are arised because if we collect tax from our customers then we pay the excess tax (after deducting the input tax credit) to the government. Now the commercial tax (TNVAT) deportment has been advised to collect as much as possible Tax. So they may pressurize us to collect tax from our customers or if we were totally wrong then there may be chance of penalty, So want to confirm which is right.
Thanking you.
CAclubindia
