Monday, 14 August 2017

Valuation In GST

Value of taxable supply
The value of goods and services supplied should be identified to ascertain the tax payable as per GST law. The value of taxable supply of goods and services shall ordinarily be the transaction value which is actually the price paid or payable,When the parties are not related and price is the solo consideration.
GST Centre
Transaction Value
Transaction value refers to the price actually paid or payable for the supply of goods and services. Normally some conditions are applied which are.....

  • The supplier and the recipient are not related
  • Price is the sole consideration for the supply
Valuation Rules
Contract price is more specifically referred to as transaction value and that is the basis for computing tax.However, when the price is influence by some factors like relationship of parties or certain transactions are deemed to be supply,which do not have a price,it is required to overcome these factors to determine the transaction value correctly.

When is valuation applicable?
Valuation rates are applicable when
(i)  Consideration not in money terms 
(ii) Transaction Value declared is not reliable
(iii) Parties are related 
(iv) supply by any specified category of supplier mentioned in the GST Law

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