Presumptive VAT

All dealers, whose annual turnover is less than 50,00,000, are qualified to pay presumptive tax on a quarterly basis.  There is further division here....i.e. turnover less than 50,00,000 but more than 20,00,000 and then turnover less than 20,00,000.


Those in the first category, i.e. less than 50,00,000, but more than 20,00,000, need to pay 0.5% of total sales quarterly as tax to sales tax department.


Those in the second category, i.e. less than 20,00,000 needs to pay Rs. 750 as tax quarterly to sales department.

1%, 20% and Purchase 8 E

Last week, it was a bit hectic at our office as we had to file a lot of stock details before June 30. Although it was not a tough job, but still was a bit monotonous.  Anyway, now it is over and we are back to our basic book keeping work.

Today I was doing preparing purchase voucher and learned that there are 2 additional VAT %, 1%, and 20% (soft drinks).

If a purchase bill contains different VAT enteries, for example 4 and 12.5%, then we have to prepare seperate purchase vouchers for the same in tally.

Similarly, some times, some businessmen instead of entering seperate cess, mix it with VAT while showing in bill, so for them, 12.5% becomes 12.6%.  In dealing with such type, we have segregate the 1% from 12.6 before entering in tally..

Let us for example say that tax of 12.6% VAT purchase is Rs. 356.

so, what we do is  = 356 - 3.56 = 352.44 (subtracting 1% of 356)

now, this is the 12.5% VAT amount

to calculate amount on which this VAT was paid = 352.44/12.5*100= 2819.52.

Another thing which I learned today was Purchase 8 E.  Businesses have to maintain separate ledger called purchase 8 E for purchases made from house/self help units. Since this is cash purchase, payment voucher is used.  This is charged under 4% VAT.
  

Purchase voucher continued (12.5 and 4%)

I did purchase vouchers for 12.5 and 4 %.

The entries were:

Purchase -4% a/c dr
Input      -4%  a/c dr
cess (1% of input value) a/c dr
                                              To sundry creditor

Similarly for 12.5%

Purchase a/c dr 12.5%
Input - 12.5% a/c dr
cess a/c dr (1%of input value)
                                              To sundry creditors

To copy previous narration in the end, use Control + R.

Purchase voucher

I was given a file related to purchases by a client firm in the year 2009-2010.  I had to create a purchase voucher in Tally 5.4 and enter only those purchases which had 0% VAT.  Religious books and candles attract 0% tax, so I had to study the bills and watch out for only those where books or candles were purchased.  It was kind of easy.  My instructor (Elsie Mam) told me the other rates of tax were 4 and 12.5% and she would guide me one by one on how to go about them too.  While creating purchase vouchers, I was asked to look out for TIN (tax identification number) of the creditors and to enter the same while creating the voucher. TIN numbers are 11 digit numbers given by Kerala Government to each and every registered establishments.

Also, I was asked to use the right side of the keyboard for all numeric entries as one can get data entered quickly using that side.

The four hours just flew by..........