Sunday, August 7, 2011

How the Input Tax Credit-has to be claimed and availed for Capital Goods? (TN VAT)

Every registered dealer while submitting monthly returns to the assessing
authority/can claim the Input Tax Credit paid for all local purchases made
from registered dealers on the basis of Original Tax Invoices in those returns
itself for Capital Goods, after the commencement of commercial production.
They can deduct the same from the Output tax, if any, payable on the local
sales or inter-State sales in those monthly returns. In the first year of
commencement of commercial production, 50% of the input tax credit not
exceeding 50% can be availed and the rest in the second or third year. But
fees condition is not applicable to parts and accessories. At the end of the
third year, any credit not availed will be lapsed to Government.

Regards
G.Srinivas

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