VAT / CST ( TIN ) REGISTRATION

VAT CST (TIN) Registration

Value added tax is levied on the sale of movable goods. Most of the Indian States have replaced Sales tax with a new Value Added Tax (VAT) from April 01, 2005. VAT is imposed on goods only and not services and it has replaced sales tax.VAT is applied on each stage of sale with a mechanism of credit for the input VAT paid. VAT is applicable with slab rate of 0 % , 4% ,5%,8%,12.5% etc. VAT is a progressive and transparent system of taxation which eliminates the cascading impact of multiple taxation through a multipoint taxation and set-off principle. It promotes transparency, compliance and equity and therefore, is both dealer friendly and consumer friendly.After registration of VAT, the manufacturer or trader is allotted a unique 11 digit number which will serve as the VAT Number / TIN Number / CST Number for the business.

As per the provisions of MVAT, a dealer is liable to pay tax on the basis of turnover of sales within the State. The term dealer has been defined u/s. 2(8) of the Act. It includes all person or persons who buys or sells goods in the State whether for commission, remuneration or otherwise in the course of their business or in connection with or incidental.

The VAT system levies tax on every level of Value addition to the product or good. At the same time the tax paid for acquiring this product or good will be allowed as tax credit and can be used for payment of VAT at the time of selling the product or good to the immediate dealer. The net effect of tax will be only on the portion of Value added by the seller. The following example clearly explains the flow of VAT system and its effect on the Selling price.

Example: Mr. A, a registered dealer purchased one good at Rs. 1,000 by paying 4% tax on it, i.e., Rs. 40. The tax paid by him can be claimed as input tax credit. On the good purchased, he did some value addition worth Rs. 500. The VAT liability after such value addition amounted to Rs. 60, i.e. 4% on Rs. 1,500. Since there is a credit of Rs. 40 on the initial purchase made, the same can be adjusted against Rs. 60. Only the balance amount of Rs.20 needs to be paid to the department.

Highlights

VAT Registration

VAT registration Contains TIN (Tax Identification Number) which is required to issue Tax invoices to other parties and get the benefit of input tax credit.

VAT Payments

In most of the states, VAT Payments are required to be deposited in monthly within 21th of the following month. In Maharashtra the payment cycle depends on government.

Basic Exemption

Small scale service providers who provide taxable services of less than Rs.10 lakhs in a year is wholly exempted from service tax and service tax registration.

No VAT on Export

For goods exported from India, VAT is not applicable. Therefore, exporters of goods are not required to pay VAT. However, it is advisable for exporters to obtain VAT registration.
 

VAT Audit

In Maharashtra if the turnover exceeds a specified limit (Rs.100 lakhs in most cases) and a Report on the same is to be submitted with the VAT authorities as VAT Audit report and same need to be certified by chartered Accountant.

VAT Returns

In VAT Monthly / Quarterly / Six monthly VAT Returns are required to be filed within due date with specifying taxes collected and paid to government treasury.

FAQs

What is Maharashtra Value Added Tax?

VAT is value added tax, a tax levied on the sale of goods in India. Each State in India has unique VAT Regulation and different tax rates are applicable for different types of products. Therefore the VAT Tax Rate and Exemptions will be unique to each State and type of goods sold.

What is the VAT rate on goods?

The VAT rate will depend on the type of goods being sold and the State in which the goods is being sold. Rate can be checked with annexure provided by department of rate applicable on goods.

What is Maharashtra VAT registration?

VAT Registration is a State level registration for paying VAT, which is mandatory for manufactures and traders having an annual turnover(Sale or purchases ) of more than Rs.10 lakhs. VAT Registration gives the manufacturer or trader a unique 11 digit number that would be required for subsequent VAT Compliance, VAT Filing and other matters incidental to VAT or Sales Tax or Central Sales Tax.

How long does it take to obtain VAT registration?

VAT Registration is issued by the Maharashtra Government. Therefore, based on the State, the processing time for obtaining VAT Registration will differ. In general, VAT Registration can be obtained in 15 - 20 working days.

What is VAT TIN Registration number?

TIN stands for Tax-Payer Identification Number, a registration that is the same as VAT registration or CST Registration. First two digit stands for the code of issuing state. TIN Registration provides the manufacturer or trader with a unique 11 digit number that is the same as VAT Registration Number. Therefore, VAT Registration, TIN Registration and CST Registration are one and the same.

I make purchases on Inter-state basis. Do I get credit of CST charged on such purchases?

No. CST has been charged by the state of origin, and hence, Arunachal government will not give any credit on account of tax charged by the other State Governments.

When should VAT payments be deposited?

VAT payments must be deposited by Proprietary Firms, LLPs, Partnership , Pvt Limited company as based on the turnover. That may be Monthly or quarterly.

When should VAT Returns be filed?

VAT returns are due on the 21th or 30th f next month based on the turnover of the dealer. Contact us to check your applicability to file MVAT return.

What is input tax?

Input generally mean goods purchased by a dealer in the course of his business for re-sale or for use in the manufacture, processing, packing/storing of other goods or any other business use. The tax paid on inputs is known as Input Tax.

Is Input Tax credit available to unregistered declares also?

For dealers below the threshold and unregistered, there is no output tax liability nor any input tax credits. However, if you cross the threshold, you are liable for output taxes, and can avail input tax credits. If you choose not to register (even after the crossing the threshold), you are liable for penalty.

Who must obtain VAT registration?

VAT Registration is mandatory for manufactures and traders having an annual turnover of more than Rs.10 lakhs. However voluntary registration can be taken as per the requirement of business.

What are the documents required for obtaining VAT Registration?

For VAT Registration, a copy of PAN Card, proof of address of business, constitution of the business such as Partnership deed, Incorporation Certificate, Shop act etc. and proof of identity of the owners is required.

Process Flow

VAT CST Registration

Our Team can help you to obtain your servicet tax registration with  10-15 working days subject to goverment approval




1 Day


We Prepare Application

Our expert team will prepare VAT registration on your hehalf and file with goverment authorities.




1 Day


Verification of documents by Government authorities

Government authorities will verify the docuements and application




1 Day


Get registraion completed

After verification of documents by department will issue 11 Digit VAT CST number for business




1 Day






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