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  • Gujarat Value Added Tax

    Overview

    VAT or Value Added tax has been in effect for over 10 years in the country, and is a tax that is charged based on the category of goods sold. VAT is an indirect tax which replaced the general sales tax and the ambiguity related to it as well. VAT aimed to make the process of taxing purchase of goods in any state simpler and more streamlined.

    Gujarat VAT Rates:

    VAT is applicable on all goods and products sold in the state, and the rates will depend on the products being sold and purchased. Any trader or dealer that has a sale or purchase turnover of a minimum of Rs. 5 lakhs is liable to pay VAT as per the VAT Act. There are different schedules for products that can be taxed and that are exempt from tax, and each of these have different rates.

    Schedule 1: Schedule 1 includes those goods that are exempt from paying taxes, these products can be Agate stones and articles made from them, agricultural implements like huller or opener, thrashers for agricultural uses. The exemption can also be extended to aids of any kind used for people with disabilities, such as Braille equipment, hearing aids, speech trainers, wheelchairs, crutches, orthopedic footwear, heart valves, intra-ocular lens for cataract operations, etc.

    Schedule 2: The goods or products under the schedule that can be taxed are:

    Particulars

    Rate of Taxes

    Agricultural implement which do not fall under schedule 1

    4 paise for every 1 rupee

    Bamboo or articles made thereof

    4 paise for every 1 rupee

    Bicycles, tricycles, rickshaws, pedal rickshaws and the accessories thereof

    4 paise for every 1 rupee

    Betel nut and areca nuts

    4 paise for every 1 rupee

    Biscuits (unbranded)

    4 paise for every 1 rupee

    Bolts, nuts, screws, and fasteners

    4 paise for every 1 rupee

    Brass metal parts

    4 paise for every 1 rupee

    Bricks, roofing tiles

    4 paise for every 1 rupee

    Trunks, buckets, drums,

    4 paise for every 1 rupee

    Candles made of wax

    4 paise for every 1 rupee

    Gold, Silver, other precious metals; jewelry made of these precious metals; precious and semi-precious stones, pearls of any type

    1 paise for every 1 rupee

    The other products covered as per this schedule will be drugs and medication, medical equipments, edible oils, all types of fabric, herbs and barks, dyes, hides and skins of animals, honey, etc. There are many products under this schedule with over 200 products being mentioned.

    Schedule 3: The sale of these products mentioned below are subject to paying VAT.

    Particulars

    Rate of Tax

    High speed diesel oil

    24 paise for every 1 rupee

    Gasoline for Aviation

    26 paise for every 1 rupee

    Gasoline for Aviation (duty paid)

    13 paise for every 1 rupee

    Aviation turbine fuel (bonded)

    38 paise for every 1 rupee

    Aviation turbine fuel (duty paid)

    13 paise for every 1 rupee

    Any motor spirit of other kinds

    26 paise for every 1 rupee

    Gujarat VAT Registration:

    Any individual who is in the business of trading of goods and products which has an annual turnover of Rs. 5 lakhs and taxable turnover that exceeds Rs. 10, 000 in one financial year is liable to pay VAT compulsorily as per the VAT Act. They will need to register their business and the form they can use for such a registration will be Form 101. The form along with the supporting documents should be provided to the registration authority.

    The documents (2 copies) that will have to be attested by a Sales-tax Practitioner and submitted along with the form, are mentioned below:

    1. 2 passport sized photographs
      • If the business is held by an individual then the proprietors photographs will be required
      • If it’s a HUF, the photograph of the Karta will be required
      • If it’s a partnership firm, photographs of all partners will be needed
      • If it’s a private limited company or a limited company, photographs of all board of directors will be required
    2. Proof of ownership of place of business
    3. Copy of passport of the owner of the business
    4. Copy of the election card of the owner
    5. Copy of registration certificate issued by custom and central excise authority
    6. Copy of last electricity bill of place of business
    7. Copy of last bill of property tax of place of business

    After providing all the documents, along with the filled up form the authorities will verify this information and then will provide the certificate for VAT.

    Form Required for Gujarat VAT:

    Form required to be filled for the registration for VAT will be:

    1. Form No. 101: This is the form that can be used to register to pay VAT.
    2. Form No. 101A: This form is used to declare any other places of business, branches or godown maintained in the State of Gujarat.
    3. Form No. 101-B: This is used to declare places of business, branches or godowns that are located outside the state and will need to be accompanied by their TIN numbers.
    4. Form No. 101C: This is the form that will inform the authority about the details of the person who is authorised to sign invoices, delivery challans, declarations, etc. A separate form will be needed for each person who has these privileges.
    5. From No. 101D: This is a form that is used to declare the people who are ultimately responsible for the business. Such people can include directors.
    6. Form No. 101E: If the company is a manufacturer then this is the form that will be used to inform the authorities about the capacity.
    7. Form No. 106: This is the form that can be used to provide information about managers within a business.

    Gujarat VAT Forms:

    Gujarat state VAT related forms can be downloaded from Gujarat Government Commercial Tax website.

    Gujarat VAT Return e-Filing

    Any individuals who would like to file their VAT, on behalf of a business, online can do so via the e-filing services available on the website of the Gujarat Commercial Tax Department. The first step that they will need to take is to register themselves. Once that is done they can file the taxes online for a specific period. They will need to choose the appropriate form to file their VAT. Registered users can make their payments after providing verified credentials and can make the payments via net banking or debit/credit cards. After the payment is made a URN will be issued and can be used in case there is a need for further communication.

    Frequently Asked Questions:

    1. How can a dealer apply for registration in Gujarat?

      The dealer will need to apply using the required forms from the Gujarat Commercial Tax website. The registration will take up to 30 days during which period all the documents submitted will be verified and an acknowledgement receipt will be provided.

    2. How much time will be provided for the dealer to pay tax?

      The tax the dealer will need to pay will be based on the products he/she in dealing with. The products listed under Schedule 2 will need the tax to be paid in 12 days whereas other products will have a time frame of 22 days.

    3. How can a dealer make an e-payment?

      The easiest way to make a tax payment is e-payment. The dealer can visit the website and can choose the tax period and other details and will be directed to his/her bank’s website. The payment can be made using netbanking and debit or credit cards.

    TAX
    Forms:
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