Dear Sir,
We are the casting manufacturer. For manufacture of castings we are using the tool developed by us on behalf of customer and retained by us for manufacture of castings.
For recovery of tool cost from Export customer we are raising invoice and the same considered as income.
WE are not charging the VAT or excise duty.
But VAT authorities informed us to charge VAT.
Please advice whether we need to charge VAT.
Regards
K Srinivasan
Casting Manufacturer Seeks Expert Opinion on VAT for Tooling Cost Invoices After Directive from Tax Authorities A casting manufacturer is seeking advice on whether to charge VAT on invoices for tooling cost recovery from an export customer. The tools, developed and retained by the manufacturer for casting production, are invoiced as income without VAT or excise duty. However, VAT authorities have instructed them to charge VAT. The manufacturer is requesting expert opinions on whether the authorities' directive is correct, noting that no responses have been received yet. (AI Summary)
TaxTMI 
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