VAT classification
It is a list of vat rates, which describes the nature of
the business activity and type pf
transaction. These are in-built in the system and will be updated if and when
any statutory changes take place. Some of the classifications are :
Input vat @ 4%
Input vat @ 1%
Input vat @ 12.5%
Output vat@ 1%
Output vat @ 4%
Output vat @ 12.5%
Purchases – capital goods
Purchases – exempt
Purchase – unregistered dealers
Depending on the type of the business, type of
transaction, and the statutory requirements of your state, you will need to select
the appropriate classifications from the list during ledger creations, voucher
entries, etc.
The sales and purchase transactions are segregated based
upon the classification selected during voucher entry and shown in the vat
computation. Thus you can see in the vat computation, the classification – wise
vat and net values.
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