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TMI BlogValuation in GSTX X X X Extracts X X X X X X X X Extracts X X X X ..... the recipient are not related and price is the sole consideration. In most of the cases of regular normal trade, invoice value will be the taxable value. However, to determine value of certain specific transactions, Determination of Value of Supply rules have been prescribed in CGST Rules, 2017. Compulsory Inclusions Any taxes, fees, charges levied under any law other than GST law, expenses incurred by the recipient on behalf of the supplier, incidental expenses like commission & packing incurred by the supplier, interest or late fees or penalty for delayed payment and direct subsidies (except government subsidies) are required to be added to the price (if not already added) to arrive at the taxable value. Exclusion of discounts Discou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ply is between unrelated persons and price is the sole consideration for such supply. Supply of like kind & quality means any other supply made under similar circumstances that is same or closely resembles in respect of characteristics, quality, quantity, functionality, reputation to the supply being valued. Illustration: (1) Where a new phone is supplied for ₹ 20000/- along with the exchange of an old phone and if the price of the new phone without exchange is ₹ 24000/-, the open market value of the new phone is ₹ 24000/-. (2) Where a laptop is supplied for ₹ 40000/- along with a barter of printer that is manufactured by the recipient and the value of the printer known at the time of supply is ₹ 4000/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods being supplied, or, at the option of the supplier, 90% of the price charged for the supply of goods of like kind and quality by the recipient to his unrelated customer. Illustration: Where a principal supplies groundnut to his agent and the agent is supplying groundnuts of like kind and quality in subsequent supplies at a price of ₹ 5000/- per quintal on the day of supply. Another independent supplier is supplying groundnuts of like kind and quality to the said agent at the price of ₹ 4550/- per quintal. The value of the supply made by the principal shall be ₹ 4550/- per quintal or where he exercises the option the value shall be 90% of the ₹ 5000/- i.e. is ₹ 4500/- per quintal. a) In case value cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t c) Life insurance business d) Value of supply of Second hand goods e) Value of redeemable vouchers/Stamps/Coupons/tokens The special provisions related to determination of these supplies are as below: - Special provision related to determination of value of service of purchase or sale of foreign currency including money changing Option-1 Case 1: Transaction where one of the currencies exchanged is Indian Rupees Taxable value is difference between buying rate or selling rate of currency and RBI reference rate for that currency at the time of exchange multiplied by total units of foreign currency. However if RBI reference rate for a currency is not available then taxable value is 1% of the gross amount of Indian Rupees provided/rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent by the airlines. Special provision related to determination of value of service in relation to life insurance business Taxable value varies with nature of insurance policy. The details are as follows:- * Where policy has dual benefits of risk coverage and investment - Taxable value is gross premium charged less amount allocated for investments or savings if such allocation is intimated to the policy holder at the time of collection of premium. * Single premium annuity policy where allocation for investments and savings is not intimated to the policy holder - taxable value is ten percent of the single premium charged from the policy holder. * Other cases- Twenty five percent of premium charged from the policy holder in the first ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial provisions related to determination of value of redeemable vouchers/stamps/coupons/tokens The value of a token, or a voucher, or a coupon, or a stamp (other than postage stamp) which is redeemable against a supply of goods or services or both shall be equal to the money value of the goods or services or both redeemable against such token, voucher, coupon, or stamp. Value of taxable services provided by a notified class of service providers as referred to in para 2 of schedule 1 between the distinct persons The taxable value is deemed to be Nil wherever input tax credit is available. Valuation of certain works contract services (i) Construction of a complex, building, civil structure or a part thereof, including a complex or buildi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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