MMR on GST Credit note

[sandeep rairakhia]

If we create an invoice with a MMR for a product, and then when taking a credit note if the MMR has changed, which MMR should apply to the credit note? the latest active one or the MMR applied on the invoice.

[KASTURI SETHI]

Pl.expand the abbreviation MMR.

[sandeep rairakhia]

Maximum marginal rate.

on the MRP, we add the MMR % + Tax % to get the List price.

so if for a product the MMR % is 10% when we create an invoice.

on doing sales return credit note, the MMR % is changed to 12%. then in return should it be 10% or 12%

[KASTURI SETHI]

What is name of your product and Chapter/Heading/Sub-heading ?

[KASTURI SETHI]

With the implementation of GST the concept of MRP based valuation is no more in force now. Transaction value under Section 15 of CGST Act is in force. Credit note in respect of sales return is to be issued on 12 % latest. Margin is included in the taxable value while computing tax to be paid. Tax is payable on the amount of margin also.

AI Summary

Transaction value under Section 15 governs credit notes; use current GST valuation and include margin in taxable value.
Under GST the prior MRP/MMR valuation approach is displaced by the transaction value concept under Section 15; a credit note for a sales return must be valued using GST valuation rules prevailing at determination, and any margin formerly reflected by an MMR must be included in the taxable value and taxed accordingly.