VAT REGISTRATION

VAT REGISTRATION

VAT is a form of consumption tax that is indirect in nature which means that it is collected by an intermediary instead of being directly levied by the Govt. The difference between this and sales tax is that VAT is collected at multiple points. This is seen as a replacement to the tax structure currently existing.Who is a person liable to pay tax Anybody buying or selling goods or products directly or indirectly for his business or in connection to the business irrespective of whether the payment is differed or is paid as salary or having any other consideration this may includeBrokers commission or mercantile agents and other agents A non-resident dealer or any agent of his Auctioneers Societies such as co-operative society associations or clubs A person indulging in casual trade A person involved in disposal of confiscated goods or goods that are unclaimed or goods that are scrap and other general unwanted goods. Banking and insurance companies who are involved in buying selling or supplying goods Transactions liable for tax under the DVAT Act Sale [Section 2(1)(zc)]The transactions which come under the term sale according to the DVAT Act areGoods transfer from one person to another. Goods transfer from one person to another. Goods transfer after they are hired or purchased. Goods supply by societies such as co-operative societies clubs or associations to its members. Transfer of goods or property made in pursuit of any particular contract. Transactions involving any work contracts. Goods transfer as part of a specific lease. Certain goods such as food articles that are supplied in any form for human consumption. These could be food materials or clothes or any consumables. Disposal of unserviceable or useless goods or goods that are confiscated form someone surplus goods or waste materials.