Answer Posted / malaya2100
1) Vat should be calculated on the net amount. e.g net
amount Rs.5000/- and vat rate according to your
applicability whether 4%/5%/12.5%.
Net amount = 5000
Vat = 200 (Taken 4%)
Total = 5200 (including Vat)
i) (in case of Sales)
Abc a/c dr Rs.5200
To Sales Rs.5000
To vat Rs.0200
ii) (in case of Purchases)
Purchases a/c Dr.5000
Vat a/c Dr.0200
To Abc a/c dr Rs.5200
2) Service Tax should be charged if taxable service provided
and mentioned in the invoices otherwise not.
NOTE : VAT and Service Tax are mutually exclusive taxes can
not charge both on at a time. So, there must be service
charges mentioned to charge service Tax.
Regards,
Malaya2100
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