Tax Book 2023

Chapter 07 Solved Past Papers Sales Tax Numericals of CA Module C

Less: Sales return (756,000) (128,520)
Total supplies/Output tax for the month 20,694,000 3,058,980

(2,753,082)
305,898
Input tax on fixed assets (170,000 x 18,750,000 / 21,450,000) (148,601)
157,297
Further tax on supplies to unregistered persons = 2,800,000 × 3% 84,000
Sales tax payable 241,297

Admissible credit (90% of output tax i.e. Rs. 2,753,082 (3,058,980 × 90%) or
input tax

948 Conceptual Approach to Taxes

Sales tax to be carried forward (3,024,738−2,753,082-148,601) 123,055
Sales tax refundable (3,374,500 × 1,000,000 / 21,450,000) 157,319

W-1: Apportionment of input tax
Residual input tax 3,374,500
Exempt supplies and export sales (1,700,000 +1,000,000) 2,700,000
Total supplies 21,450,000
Inadmissible input tax [(2,700,000/21,450,000) × 3,374,500] 424,762

March 2017 Q. NO. 7

(Note - 1) Assumed that supplies invoices to un registered persons have NTN or CNIC of recipients, as applicable only on

distributors otherwise proportionate input tax shall be disallowed under section 8(1)(m) of the Sales Tax Act, 1990.

Rupees
Supplies

750,000

550,000

70,000

95,000

The folowing further information is available:

(i)

Purchases

March 2017 Q. NO. 7

Taxable goods from unregistered suppliers

Taxable goods supplied to registered customers include goods amounting to Rs. 300,000 supplied to an associated

JahangirAli(JA)isregisteredundertheSalesTaxAct1990.JArunsmultiplebusinesses.Folowinginformationhasbeenextracted
for the month of February 2023:

100,000

3,000,000

Taxable goods exported to Qatar
Taxable goods to registered customers
Taxable goods to unregistered customers

Taxable goods from registered suppliers
Exempt goods from registered suppliers

(i)

(ii)

(iii)

• 
  


• 
  


• 
  


• 
  

  (iv)

  
  

Taxable goods purchased from registered suppliers include:

office equipment of Rs. 200,000, purchased for the warehouse.

Goods pledged with a bank were sold by the bank in an auction for Rs. 1,000,000. The normal seling price of these goods

was Rs. 1,200,000.

Taxable goods supplied to registered customers include goods amounting to Rs. 300,000 supplied to an associated

company at a special discount of 25%.

TaxablegoodssuppliedtounregisteredcustomersincludegoodsworthRs.100,000suppliedtoSaleemBrothers(SB).

JAdidnotchargeanysalestaxfromSBasithassubmittedanundertakingthatitisacottageindustryandexemptfrom

sales tax under the Sixth Schedule of the Sales Tax Act, 1990.

goods worth Rs. 320,000 purchased from Akram Limited who was blacklisted on 25 February 2023 due to issuance of

flying invoices.

goods purchased from ZA Traders amounting to Rs. 30,000. ZA Traders did not declare this amount in its tax return for

the month of February 2023.

a new machine purchased for Rs. 500,000 which was commissioned into operation during February 2023.

(v)

Rate of sales tax is 17%. Al figures are exclusive of sales tax.

Required:

Jawwad Associates (JA)
Computation of Net Sales Tax Liability
For the tax period February 2023
Rs. Rs.
SALES TAX CREDIT (INPUT TAX) Taxable value Sales Tax @ 17%

Taxable goods from registered suppliers 1,950,000 331,500

Excess of input tax over output tax brought forward from January 2023 was Rs. 110,000.

UndertheprovisionsoftheSalesTaxAct, 1990 andRulesmadethereunder,computetheamountofsalestaxpayablebyor
refundable to JA and the amount of sales tax to be carried forward, if any, for the tax period February 2023.

was Rs. 1,200,000.

Taxable goods from registered suppliers 1,950,000 331,500
(3,000,000 – 320,000 – 30,000 – 500,000 – 200,000)
Exempted goods from registered suppliers 70,000 -
Taxable goods from unregistered suppliers 95,000 -
Fixed assets (Machinery) 500,000 85,000
416,500

Less: Inadmissible/un-adjustable input tax (W-1) (15,426)
Admissible input tax 401,074
Add: Excess of input tax over output tax 110,000
Input Tax for the month (Accumulated credit) 511,074

948 Conceptual Approach to Taxes