How to file VAT return online - Step by Step Guide.

 VAT or Value added tax is the tax imposed on the purchase or sales of goods and services provided that the yearly turnover crosses the limit of Rs 5 Lakhs or Rs 10 Lakhs ( depending upon the state guidelines ) by the state government. All the traders and suppliers are abided to get registered to pay VAT. 


 VAT Returns is the measure of Value-Added Tax owed to HM Revenue and Customs, ordinarily submitted on a month-to-month or quarterly premise depending upon the state under which the business is enrolled. Since the VAT Returns are decided by the state govt, the duties and rules are diverse in regard to each state in India. In any case, if the business is situated in more than one state, VAT Returns for various states ought to be recorded independently. As VAT is charged at every production stage, the proprietor holds some piece of VAT gathered from the client while the other piece of the sum is moved to the Government's asset through assigned banks each month.


Filing for VAT online is a less time-consuming task but at the same time it has to be done with complete responsibility without any silly mistakes and you can not overlook even a tiny of the smallest details. In such cases, it is advisable to take up CA services for tax returns, certainly from the same state from where you operate your business services to keep it easy and convenient for you. They will guide you in each and every step and also make sure that you won't require to pay a penalty due to any misinterpretation issues. 


Following things are to be considered before calculating the VAT tax amount :

 

  • Total of the sales and purchase of raw material, product, or service on a quarterly basis.

  • The amount that is owed for the sales.

  • The total amount that can be reclaimed from the purchases done by the business.


If the amount that is owed on the sales is more than the amount to be reclaimed then VAT is to be paid to HM Revenue and customs and if vice versa is the case then HM Revenue and Customs will pay you the difference amount.


Things Required for filing the VAT return online:-

  1. TIN Number:- This is the 11 digit tax identification number that is issued to business dealers by the concerned tax department of the state. This number will be used by the state govt to keep the track of all the tax-related queries. 

  2. User ID:- Once the dealer gets registered, they will receive their user id and password from the state tax department. If you are a first-time user then you are required to change the password after you log in.

  3.  E-Filing Software:- Once you access your account by logging in you have to download the e-filing software that will convert the e-filling data to XML which has later to be uploaded on an online portal of the Directorate of commercial taxes.

  4. VAT receipts:- You can generate the VAT receipts of every transaction you do use your account.

 

Once you have collected all these things it will take very little time to fill the VAT. You keep the regular check on your VAT account because it consists of all the important data and statements required to fill the VAT.


Given below are the steps that are required to be followed to e-file the VAT:-


  1. Go to the website or online portal of the directorate of commercial taxes of your state from where you manage your business services and log in to your account.

  2. After logging in to your account you need to download a zipped file of a form named 14D which will be in pdf format and you have to fill it with an annexure.

  3. The information that you require to fill in the form is all mentioned in VAT Receipts. If you get confused in this stage you take help from your CA services for the tax return.

  4. With the help of the software that you downloaded you have to convert the form into an XML file and then upload it on the website with annexures required. 

  5. The e-filing system then verifies the data and if any mistake is found it has to be rectified and again has to be resubmitted.

  6. After the form gets submitted you will receive a receipt as an acknowledgment of the VAT file. This receipt will work as evidence for you to prove that you are paying VAT every month on time.


Overall it can be said that filling for VAT online is a better option because it is not only paperless and time-saving but also chances of error decrease as all the data are saved in the taxpayer's account. Also, chances to lose acknowledgment receipts are near to zero because a copy will always stay in the taxpayer's account.

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