VAT/ CST Registration

Value added tax (VAT) is tax on exchanges. It is levied on the added value that results from each exchange. It differs from a sales tax because a sales tax is levied on the total value of the exchange. For this reason, a VAT is neutral with respect to the number of passages that there are between the producer and the final consumer. A VAT is an indirect tax, in that the tax is collected from someone who does not bear the entire cost of the tax. To avoid double taxation on final consumption, exports (which by definition, are consumed abroad) are usually not subject to VAT and VAT charged under such circumstances is usually refundable.

Sales Tax Registration

Sales Tax Registration is mandatory for any business entity with a turnover of over Rs. 5 lakh engaged in the sale of goods in India. VAT is collected and governed by the State Government, so each State Government in India has distinct rules applicable for their State based on the type of good manufactured or sold

Sales Tax Registration is required if the annual turnover of the business crosses Rs. 5 lakh in most states, though some have raised this threshold limit to Rs. 10 lakh. Once it crosses the threshold limit, it is mandatory to collect sales tax.

When registered for VAT/Sales Tax, the manufacturer or trader is allotted a unique 11 digit number which will serve as the TIN Number for the business

Benefits of Sales Tax

• VAT is a tax levied on sales of goods in India. Manufacturers and traders should obtain VAT registrations if their annual sales is more than Rs. 5 Lakhs (Rs. 10 Lakhs in some states.)
• Vat is determined and collected by State Government so each state has different VAT rules.
• No VAT is levied on goods exported from India.

VAT/CST RETURNS

• e-returns of VAT/CST to Sales tax Department
• Online filing of VAT/CST Way bills to Sales tax Department
• Online filing of Quarterly ‘C’ Form and ‘F’ form to Sales tax Department.