Tax Book 2023

Practice Questions with Solutions Chapter- 06

(Note - 3) As purchases from non-registered persons are without sales tax invoices hence the same shall
be without sales tax u/s 23(2) of the Sales Tax Act, 1990, therefore the question of adjustment of input tax
in not applicable.

(Note - 3) A registered person is not entitled to claim or deduct the input tax paid on electricity, telephone
and gas bills that are not being the direct constituent and integral part of the taxable goods produced,
manufactured or supplied during the course or in the furtherance of any taxable activity under section 8 of
the Sales Tax Act, 1990.

Q.1 1 Mr. Usman is a registered commercial importer. Data for his business for the month of August 20 22

is as follows:

Rs.

1 Taxable supplies to registered person 402,130

2 Taxable supplies to non-registered person 94,013

(including the amount of sales tax)

3 Supplies to DTRE registered person 192,993

4 Zero rated supply 607,785

5 Taxable purchases from registered person 209,812

6 Exempted purchases 35,912

7 Imported goods 337,100

8 Sales tax paid on gas bill- consumed 18,000

9 Sales tax paid on electricity bills 20,000

(Sales tax registration number is printed on)

10 Previous month credit b/f 2,000

Required: Calculate sales tax payable.

Solution

Rs.

Output tax

On taxable supplies to registered person U/S 3 (Rs. 402,130 x 17%) 68 ,3 62

On taxable supplies to non-registered person U/S 3 (Rs. 94,013 x 17 / 117) (Note – 4) 13 , 660

Supplies to DTRE registered person [U/S 4 read with 5th Schedule] 0

Zero rated supplies [U/S 4 read with 5th Schedule] 0

82 , 022

Input tax

On apportioned local supplies (working attached)

Of previous month credit b/f

34 , 956

2,000

Balance sales tax payable

45 , 066

Sales tax refundable in respect of zero rated supplies / DTRE supplies 58,018

Working

Taxable purchases from registered person (Rs. 209,812 x 17%) 35 , 668

Exempted purchases 0

Imported goods U/S 3 (Rs. 337,100 x 17%) 57 , 307

Sales tax paid on gas bill- consumed (Note – 5 ) 0

Sales tax paid on electricity bills (Note – 5) 0

Total input tax to be apportioned 92 , 975

Apportionment of taxable supplies input tax

[U/R 25 of the Sales Tax Rules, 2006] Supplies Input tax

Rs. Rs.

Taxable supplies to registered person 402,130

Taxable supplies to non-registered person (94,013 x 100/117) 80,353