Turnover Discount Treatment

[Raman Singla]

What should be treatment of Turnover based discounts received (without GST as per Section 15(3)(b)) in Trading Account ?

AI Summary

Debate on Accounting for Turnover-Based Discounts Under Section 15(3)(b): Deduction from Purchases or Indirect Income? A discussion on the accounting treatment of turnover-based discounts received without GST under Section 15(3)(b) in a trading account. One participant suggests that showing the discount as a separate income item could lead to tax issues and litigation, proposing instead to explore showing it as a deduction from purchases. Another participant requests more details to provide a concrete response, emphasizing the importance of careful drafting in purchase agreements. The original query seeks clarity on whether such discounts should reduce purchase costs in the trading account or be shown as indirect income. An article on the topic is shared via email.