Discount on sale price

[THYAGARAJAN KALYANASUNDARAM]

Dear Experts,

One of my clients who supply the goods to various customers based on the payment terms, as stated below.

Example

Sale price 1000/- + Vat Tax = Bills raised

After supply the goods with bill raised.

1) if the payment received within 15 days, My client would issue credit note 20%, i.e. 200+ vat Tax

2) if the payment received within 15-30 days, My client would issue credit note 10%, i.e. 100+ vat Tax

Now, my query whether the tax can be adjusted for the above transaction while filing the return under the erstwhile TNVAT act? or we can only adjust the basic value.

Please advice me on this.

AI Summary

Clarification Sought on Tax Adjustments for Discounts Under TNVAT Act; Credit Notes Not Deductible Post-Sale A client provides goods to customers with a discount scheme based on payment timing: a 20% credit note if paid within 15 days and a 10% credit note if paid within 15-30 days, both including VAT. The query seeks clarification on whether tax adjustments can be made under the TNVAT Act when filing returns. Responses indicate that only the basic value can be adjusted, and post-sale discounts via credit notes are not deductible under TNVAT. It is noted that VAT regulations vary by state, with some allowing adjustments within specific timeframes.