VAT return filing is an important mechanism for the viability of VAT system, since it works as a medium for reporting the VAT collected and paid to the revenue authorities. VAT return filing is a formal way of reporting the VAT collected and paid during any particular period. VAT return is prepared on the basis of the documents available in the records or ledgers. VAT returns also form a basis for auditing and activities related to enforcement of VAT law.
IDMS Accounting services have a team of tax specialists who can help your business structure in-house recording and filing processes to ensure that your company does not incur any penalties from improper compliance due to wrong return filing.
About VAT return filing: Companies are required to file returns periodically. Initially companies will be expected to file returns every quarter or monthly depending on their turnover.
By the end of each filing period business must compile the data on tax paid and tax collected and file the returns following the computation guidelines. A tax liability can accrue as early as the date on which an order advance is received. If no advance is received then the date of delivery or invoice, whichever is earlier will be taken into consideration.
Some examples for adjustments:
Audit of Records
Government may directly or through its appointed agents demand to audit the tax returns of the companies. Companies are required to maintain physical records of all purchases and supplies as also maintain complete registration details of suppliers and customers.
Although a completely digital system for tax filing will be in place, the government may expect companies to furnish proof of returns.
The VAT will be based on Self-Assessment and the onus will be on the companies to accurately account for the output and input tax.