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Discounts are very common in business. There are various types of discounts like trade discount, cash discount, quantity discounts, repeat customer discounts, end of year discounts etc. These discounts are allowed mainly to encourage customers to purchase more goods or to make early payments. It is necessary to understand the VAT impact on such discounts allowed.   

Though the VAT provisions are similar at large across the states, there are variances observed with respect to the...

VAT is a levy on sale of goods. For the purpose, it is usually the seller who would be held liable for payment of VAT. However, there are few exceptions created under the VAT provisions. As per Section 3(2) of KVAT Act 2003, in case there is a sale by an unregistered person to a registered dealer, then the tax shall be paid by such registered dealer who is a buyer of goods. Similarly exceptions are created with respect to collection and payment of tax especially in case of industrial...

VAT is a levy on sale of goods. For the purpose, it is usually the seller who would be held liable for payment of VAT. However, there are few exceptions created under the VAT provisions. As per Section 3(2) of KVAT Act 2003, in case there is a sale by an unregistered person to a registered dealer, then the tax shall be paid by such registered dealer who is a buyer of goods. Similarly exceptions are created with respect to collection and payment of tax especially in case of industrial canteen...