VAT
VAT applies when you ship a product to a customer whose receiving location is within the same state as your shipping location. When you transfer products to another location in your company that is in a different state, a retention percentage is retained.
VAT consists of two tax types:
VAT
The system calculates VAT as the current taxable amount that includes the excise tax amount.
Additional Tax/Surcharge
The system calculates additional tax or surcharge based on the VAT amount.
Continuing the example from excise tax, this table shows a typical tax calculation for VAT:
Tax Name |
Calculation Based On |
Rate |
|---|---|---|
PRM1 |
Base price minus item promotion discount |
50 percent |
BED |
Current price |
16 percent |
ECD |
Base price minus discounts plus BED tax |
2 percent |
AED |
BED tax |
4 percent |
VAT |
Base price minus discounts plus BED tax plus ECD tax plus AED tax |
21 percent |
SUR |
VAT tax |
13 percent |
If the base price for an item is INR 2000.00, the system performs the following calculations to determine the final price:
Adjustment |
Calculation |
Price |
|---|---|---|
PRM1 |
2000.00 × (50 ÷ 100) |
1000.00 |
BED |
1000.00 × (16 ÷ 100) = 160.001000.00 + 160.00 |
1160.00 |
ECD |
1160.00 × (2 ÷ 100) = 23.201160.00 + 23.20 |
1183.20 |
AED |
160.00 × (4 ÷ 100) = 6.401183.20 + 6.40 |
1189.60 |
VAT |
1189.60 × (21 ÷ 100) = 249.821189.60 + 249.82 |
1439.42 |
SUR |
249.82 × (13 ÷ 100) = 32.481439.42 + 32.48 |
1471.90 |