charging VAT on sale of scrap

[Guest]

Scrap material consisting of used bottles,packaging ,cartons,old furniture etc are being sold to petty scrap dealer with turnover less than ₹ 300000/- Are we supposed to collect VAT from the vendor.

[Ganeshan Kalyani]

The turnover of seller is important to determine whether tax need to be collected on the sales invoice or not. You need to ascertain your turnover and charge VAT accordingly. Thanks..

AI Summary

VAT on scrap sales requires assessing seller turnover to determine whether VAT must be collected on the sale. The operative determinant for charging VAT on sales of scrap is the seller's turnover; sellers must ascertain their taxable turnover and, if it meets the statutory threshold creating a VAT collection obligation, charge VAT on sales invoices to scrap dealers.