One of the sea changes brought about by the GST era is the way we determine the value of goods and services.As a business, one needs to be aware of the changes in the valuation method and also how to go about valuation in some special cases, for e.g. additional charges / discounts, branch transfers (which are taxable under GST) and when a supply is made with money not being the consideration.In order to eliminate ambiguities and avoid litigation due to inaccurate or flawed valuation of goods and services, valuation methods have been provided by the law which act as guidelines to businesses while determining the accurate taxable value.In the previous tax regime, different methods were adopted to determine the value of the supply, for e.g. -a) Excise - Based on transaction value or quantity of goods or MRPb) VAT - Based on sale valuec) Service Tax - Based on taxable value of taxable service renderedHowever, in the GST regime, the value of goods and / or services supplied will solely be the transaction value, i.e. the price paid / payable at each point in the supply chain.Which may lead us to our next question - how do we account for additional charges and expenses, such as discount, packing charges etc. - under the GST regime?

Source: Economic Times August 19, 2017 05:48 UTC