Tuesday, April 28, 2009

sale tax

Important Supporting Concepts and Tables

Zero-rated Supplies
The supplies which are taxed at the rate of ‘0%’ are called zero-rated supplies these are:-
Exported goods
DTRE (Duty and Tax Remission Exports)

Exempted Sales
Exempted supplies means locally sold goods which are purchase in previous month

Commercial Exporter
Commercial exporter means a registered person who has no manufacturing facility of his own and exclusively makes zero-rated supplies or ‘same stated goods’.

Same Stated Goods
Same Stated goods mean goods purchased by a commercial exporter or manufacturer cum exporter against tax invoice for export as such.

Section 8B(I) SRO 647(1) 2007
Under this section Total input tax should not exceed 90% of the total output tax. It is a maximum limit of input tax in general case. Normally it is given when sales are made to Registered person. However there are some exceptions to the section:
Exception to the section.
This section 8B (1) shall not apply in case of;
Commercial importer
Whole seller
If item are Under SRO 644 (1) [Table I]
If items are Under SRO 644 (I) [Table II]
Manufacturer consuming Raw Material

Important Note:
No input tax in case of sales tax credit, it will be claimed as tax refund.
No tax credit on utilities in case of commercial exporter

Assessed Imports

Value of imports will be considered as by custom duty ( at import stage)
+ custom duty
+Federal duty

Total Imports Xxxxxxxxxxxxx

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