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Value added tax is charged by trading companies or by manufacturing companies.?

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Question added by Umair Javed , Deputy Manager Accounts & payables , Fazal Group Of Companies
Date Posted: 2015/12/29
Anil Chauhan
by Anil Chauhan , Senior Accountant , DOTW KUWAIT WLL

It do not depend  on the  nature of the company, it depends  what trading activities are covered by the  related statue to charge the Value Added Tax and need to check how to charge and it all differ from country to country .

 

 

Muhammad Saeed
by Muhammad Saeed , Experienced Associate Auditor (Secondment) , Deloitte and Touche (Middle East)

Value added tax is charged by Manufacturing companies.

manseer muhammed ali
by manseer muhammed ali , Accountant General , Royal Lighting L.L.C & Royal Furnishing LLC

vat is charged by both trading and manufacturing company

Subash Thomas
by Subash Thomas , Manager- Internal Audit. , Suhail Bahwan Group Holding LLC

VAT is multi point tax. It is charged by the manufacturing companies, distributors, traders/ whole salers and retailors until the product is reached the end user. There is an input tax credit, which is debited when the distributor purchases the goods from the manufacturer. This is continued till the product reaches the end user. In effect, each trader has to charge the VAT on the margin or profit he is added to the cost of the product. 

 

Abdul Jawad Qamar
by Abdul Jawad Qamar , Accounts Manager , Zas Travels

VAT is charged by the both.

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