ALL
FAQ
ON J&K VAT
Q1. What
is the taxable limit in J&K?
A: Under
The Jammu and Kashmir Value Added Tax Act, 2005 taxable limit means in relation
to a dealer who:
(a)
Imports for sale or use in manufacturing or processing any goods into the State
on his own behalf or on behalf of his Principal -NIL
(b) manufactures or produces any goods for sale or is engaged in
any business other than the business specified in (a) above Rs.7.50 lacs
Q2. Who
Registers under VAT?
A: All dealers above the taxable
limit have to register under VAT.
Q3. What
will the taxable limit include?
A: The taxable limit includes gross
turnover of sales or purchases.
Q4. What is included in the gross turnover to
determine the liability to pay tax?
A: The
turnover of all sales or purchases as the case may be shall be taken, whether
such sales or purchases are taxable or not and the turnover shall include all
sales or purchases as the case
may be, made by a dealer on his own account and also on behalf of
principals whether disclosed or not.
Q5. What
is Input tax credit?
A: The
set-off which a dealer gets for the taxes paid on purchases made within the
State is the Input Tax Credit.
Q6. What
is the eligibility for Input Tax Credit?
A:
Facility of INPUT TAX CREDIT is available for tax paid on goods purchased
within J&K by a registered dealer having a TIN (Tax Payer Identification
Number) from another registered dealer
also having a TIN.
Q7. Are
inter-state purchases eligible for Input Tax Credit ?
A: No, Inter-State Purchases are
not eligible for Input Tax Credit.
Q8. What
is a tax period under the J&K VAT Act?
A: The
Tax period under The Jammu and Kashmir Value Added Tax Act, 2005 is a quarter
which means that the returns have to be filed on a quarterly basis.
Q9: What
happens to the excess Input Tax Credit ?
A: If the Input Tax Credit of a Registered dealer exceeds the tax collected during a tax
period the excess Input Tax Credit will be carried over to the next tax
Period/s.
Q10: What about refund of excess Input Tax Credit ?
A: The Input Tax Credit will be
carried up to the end of the next financial year beyond which the excess
unadjusted Input Tax Credit, if any, will be eligible for refund.
Q11. Which
dealers are eligible for turnover tax registration ?
A:
Dealers who are neither MANUFACTURERS nor IMPORTERS nor EXPORTERS and whose
GROSS ANNUAL TUROVER OF SALES is between Rupees 7.50 lacs
and Rupees 20 lacs, have the option to register for
TURNOVER TAX and pay tax @ 1% of their taxable turnover.
Q12. Can a dealer registered under turnover tax
claim the benefit of Input Tax Credit?
A: No, the facility of Input Tax
Credit is not available to a dealer registered under turnover tax.
Q13. Can a
dealer registered under turnover tax issue a tax invoice?
A: No, a dealer registered under
turnover tax can’t issue a tax invoice.
Q14. When
shall a VAT invoice be issued?
A: A
dealer having a TIN (Taxpayer Identification Number) when selling goods to
another dealer having a TIN shall issue a VAT INVOICE.
Q15. When
shall a retail invoice be issued?
A: If a
dealer having a TIN (Tax Payer Identification Number) sells goods to a dealer
who does not have a TIN or is registered as a dealer under Turnover Tax or as a
Casual Trader or is an unregistered dealer or is a customer, the dealer shall
issue a RETAIL INVOICE.
Q16. On
what kind of invoice is Input Tax Credit available?
A: Input
Tax Credit is available only on VAT invoice (original) and no Input Tax Credit
is available on a retail invoice.
Q17. Can a dealer registered under turnover tax
charge tax from the consumers?
A: No, a dealer registered under
turnover tax can’t charge any tax from the consumers.
Q18. Is
the mode of assessments different under VAT system?
A: Yes,
there is a mechanism of self–assessment under VAT whereby the dealers assess
their own tax liability and pay the tax due as per the returns filed by them on
a quarterly basis.
Q19. Who
gets the facility of self-assessment?
A: The
facility of self-assessment is available to all registered dealers irrespective
of their turnover.
Q20. Shall
the department issue any notices for assessment?
A: No,
the department shall not issue any notices for assessment, if the dealers file
their returns in time and also pay the tax due in time.
Q21. Will
all the returns filed by dealers be picked up for audit?
A: No, a
transparent criteria has been evolved under which a
small percentage of cases shall be picked up for tax audit/ audit assessment.
Q22. Is
there any surcharge under VAT?
A: No, there is no provision for
surcharge under VAT.
Q23. Is it
mandatory for a dealer having a TIN to issue a VAT or a retail invoice?
A: Yes,
it is mandatory for all registered dealers having a TIN to issue a VAT invoice/
a retail invoice, as the case may be.
Q24. What
happens if a dealer having a TIN fails to issue a VAT invoice or a retail
invoice, as the case may be?
A: If a
dealer having a TIN fails to issue a VAT invoice or a retail invoice, as the
case may be, shall be liable to a penalty equal to ten times of the tax payable
on each such default or Rs. 10,000 whichever is
higher.
Q25. What happens if a person purchases goods from a
dealer (having
a TIN) without an invoice?
A: If a
person purchases goods from a dealer having a TIN without an invoice, he shall
be liable to penalty equal to double the amount of tax leviable
on such goods.
Q26. Is the depiction of price of commodity and
component of tax separately on the VAT/retail invoice mandatory?
A: Yes,
it is mandatory to depict the price of commodity and component of tax
separately on the VAT/retail invoice.
Q27. What
are the different tax rate slabs under VAT?
A: The tax rate slabs under VAT
are: 0%, 1%, 4% and 12.5%
Q28. Which
commodities have been kept out of VAT ?
A:
Aviation Turbine Fuel, Diesel, Liquor, Lottery tickets, Natural Gas, Petrol and
Resin have been kept outside VAT.
Q29. What
is the status of services under VAT in J&K?
A: The
services have been kept outside the purview of VAT in J&K and are taxed
under The Jammu & Kashmir General Sales Tax Act, 1962.
Q30. Is there a provision of tax deduction at source
under The
A: No,
The Jammu and Kashmir Value Added Tax Act, 2005 does not have any provision for
tax deduction at source and the same continues to be governed under The Jammu
& Kashmir General Sales Tax Act, 1962 .
Q31. What
is the benefit for exporters under VAT?
A: If
any goods are exported outside the
State is
allowable ) and the dealer is entitled to the refund
of the Input Tax paid in the State.
Q32. If I
need a registration, in what Form VAT need I to apply?
A: Every
dealer other than a Casual Trader liable to be registered (including voluntary
registration) shall submit an application in Form VAT-01 to the Jurisdictional
Registering Authority. The application for registration by a casual trader
shall, however be, in Form VAT-02.
Q33. What
is the period of validity of a dealer’s registration certificate?
A: Every
certificate of registration other than the certificate of registration of a
Casual Trader is valid for a period of five years from the date of issue and,
in case of dealers already registered
under The
Trader
the certificate of registration shall be valid only for the period as recorded
in his certificate of registration.
Q34. Within what time period has a registered dealer
to apply to the Jurisdictional Registering Authority for carrying out any
amendment in his registration certificate?
A: The time period prescribed is 30
days.
Q35. Within what time period shall the
Jurisdictional Registering Authority amend the certificate of registration?
A: It shall be done within 20 days
of the receipt of the application for amendment .
Q36. Is it mandatory for a registered dealer to
display the certificate of registration?
A: Yes,
it is mandatory on the part of every registered dealer to display the
certificate of registration at a prominent place at his main place of business
and certified copies are to be displayed at the additional place of business,
if any. If any registered dealer fails to do so he shall be liable to a penalty
of Rs.5,000.
Q37. What happens to a dealer who was required to
get himself registered but has failed to do so?
A: A
dealer who was required to get himself registered but has failed to do so shall
be liable to a penalty of Rs. 5,000 besides the
concerned Assessing Authority shall assess to the best of his judgement the amount of tax due from the dealer.
Q50. What
happens to a turnover tax dealer whose turnover exceeds Rs.
20lacs?
A: As
soon as the turnover of a dealer registered under turnover tax exceeds Rs. 20 lacs, he shall at once
bring it the notice of the concerned Assessing Authority and apply for a TIN.
Q51. What
is the procedure for filing of returns?
A: Every
registered dealer other than a casual trader shall submit a quarterly return
(Form VAT-11 by a VAT dealer or a voluntary registration dealer and Form VAT
–12 by a dealer liable to
turnover
tax) containing particulars of sales and purchases accompanied by proof of full
payment of any tax due, to the Jurisdictional Assessing Authority within one
month from the expiry of each tax period. Every casual trader shall furnish to
the Jurisdictional Assessing Authority a quarterly return in Form VAT-13 along
with proof of full payment of tax due within one month after the expiry of the
quarter.
Every
dealer other than a Casual trader liable to pay tax under the Act shall also
furnish an annual return. Such return shall be filed in Form VAT 11-A by a VAT
dealer or a voluntary
registration dealer, and in Form VAT 12-A by a turnover tax dealer
within 120 days from the expiry of that year. A trading account shall accompany
every such return. Every VAT dealer
shall also furnish along with annual return and trading account
a list of VAT invoice books used during the year mentioning therein the total
number of VAT invoices issued out of each
VAT
invoice book so used.
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