kidrow
Adept
Hi all,
I'm a small retailer involved in the sale of automotive batteries to the end consumer. (So a b2cs?). I'd like help in understanding how much tax is payable under the GST regime in various situations, & about how things such as invoices & returns should be set up.
Section 1-
1a) Say the MRP of 1 battery is 5000, would my Sales Invoice to the end consumer express the price as:
Rs. 3906 + SGST Rs. 547 (@14%) + CGST Rs. 547 (@14%) = 5000?
Thus in effect, is it only a breakdown of the price?
Correct me if I'm wrong, but I'm assuming the GST cannot be added on top of the MRP, given that it is supposed to be all inclusive.
1b) Say the Purchase Invoice states the price for the same battery as:
Rs. 3125 + SGST Rs. 437 (@14%) + CGST Rs. 437 (@14%) = Rs. 4000.
In such as scenario, what is the amount that I'm liable to pay to the Govt? How is the calculation done? I've read about 'Input Tax Credit' but I'm not sure what it means, & what bearing it has on the calculation.
2a) Now, suppose I opt for the Composition scheme. Would my Sales Invoice to the end consumer express the price as 3906 only? I've read that one cannot charge GST when under the Composition scheme.
2b) In the Composition scenario then, what is the amount that I'm liable to pay to the Govt? Is it 0.5% of Rs. 3906?
3a) If a discount is given to the consumer, would it change the tax payable to the Govt. in any way?
3b) Does profit get affected if one opts for the Composition option?
Section 2-
Now, onto another aspect. It is standard practice to buy back the old battery from the consumer.
4) So say I buy back a scrap battery from the consumer for Rs. 500. & sell it for Rs. 600 to a local scrap dealer.
What would the tax payable to the Govt be in this particular instance, since it involves buying from & selling to unregistered entities?
I've encountered a term 'reverse charge' in the context of unregistered entities. Would that have any bearing here?
5) What would my Sales Invoice to the scrap dealer look like?
Rs. 600 + SGST Rs. 84 (@14%) + CGST Rs. 84 (@14%) = Rs. 768.?
Or will it be broken down into components as it was with the MRP?
i.e. Rs. 468 + SGST Rs. 66 (@14%) + CGST Rs. 66 (@14%) = Rs. 600?
6) Could there be any difference in the GST rate applicable, given that this is purchase & sale of a scrap battery & not a new product?
7) Would the situation change if the scrap dealer is registered under GST?
8) How would the situation with respect to the scrap battery buy back & sale change if I opt for Composition?
Many thanks for your patience & taking the time. Much appreciated. Good day!
I'm a small retailer involved in the sale of automotive batteries to the end consumer. (So a b2cs?). I'd like help in understanding how much tax is payable under the GST regime in various situations, & about how things such as invoices & returns should be set up.
Section 1-
1a) Say the MRP of 1 battery is 5000, would my Sales Invoice to the end consumer express the price as:
Rs. 3906 + SGST Rs. 547 (@14%) + CGST Rs. 547 (@14%) = 5000?
Thus in effect, is it only a breakdown of the price?
Correct me if I'm wrong, but I'm assuming the GST cannot be added on top of the MRP, given that it is supposed to be all inclusive.
1b) Say the Purchase Invoice states the price for the same battery as:
Rs. 3125 + SGST Rs. 437 (@14%) + CGST Rs. 437 (@14%) = Rs. 4000.
In such as scenario, what is the amount that I'm liable to pay to the Govt? How is the calculation done? I've read about 'Input Tax Credit' but I'm not sure what it means, & what bearing it has on the calculation.
2a) Now, suppose I opt for the Composition scheme. Would my Sales Invoice to the end consumer express the price as 3906 only? I've read that one cannot charge GST when under the Composition scheme.
2b) In the Composition scenario then, what is the amount that I'm liable to pay to the Govt? Is it 0.5% of Rs. 3906?
3a) If a discount is given to the consumer, would it change the tax payable to the Govt. in any way?
3b) Does profit get affected if one opts for the Composition option?
Section 2-
Now, onto another aspect. It is standard practice to buy back the old battery from the consumer.
4) So say I buy back a scrap battery from the consumer for Rs. 500. & sell it for Rs. 600 to a local scrap dealer.
What would the tax payable to the Govt be in this particular instance, since it involves buying from & selling to unregistered entities?
I've encountered a term 'reverse charge' in the context of unregistered entities. Would that have any bearing here?
5) What would my Sales Invoice to the scrap dealer look like?
Rs. 600 + SGST Rs. 84 (@14%) + CGST Rs. 84 (@14%) = Rs. 768.?
Or will it be broken down into components as it was with the MRP?
i.e. Rs. 468 + SGST Rs. 66 (@14%) + CGST Rs. 66 (@14%) = Rs. 600?
6) Could there be any difference in the GST rate applicable, given that this is purchase & sale of a scrap battery & not a new product?
7) Would the situation change if the scrap dealer is registered under GST?
8) How would the situation with respect to the scrap battery buy back & sale change if I opt for Composition?
Many thanks for your patience & taking the time. Much appreciated. Good day!
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