Clarification on GST for Travel & Tour Services

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  1. ash@2169

    [email protected] New Member

    Need an urgent clarification on application of GST on Travel & Tour Services. I think it will be better if I use an example.

    Calculation A: Current procedure followed by the agency
    Nett cost charged by Vendor / Supplier for tour package - Rs. 1000.00
    GST (4.5%) - Rs. 45.00
    Total amount payable to Vendor - Rs. 1045.00

    Markup (10%) on the Rs. 1045 - Rs. 104.50
    Nett amount charged to customer - Rs. 1149.50
    GST (4.5%) - Rs. 51.75
    Total amount payable by the Customer - Rs. 1201.25


    Calculation B: My understanding of the GST rules
    Nett cost charged by Vendor / Supplier for tour package - Rs. 1000.00

    GST (4.5%) - Rs. 45.00
    Total amount payable to Vendor - Rs. 1045.00

    Nett cost for tour package charged to customer - Rs. 1000.00

    Markup (10%) on the nett cost - Rs. 100.00
    Nett amount charged to customer - Rs. 1100.00
    GST (4.5%) - Rs. 49.50
    Total amount payable by the Customer - Rs. 1149.50


    Kindly advise which is the correct procedure as you will notice that the difference in the amount payable by the customer is Rs 51.75

    Regards
     
  2. RAMESH POLINENI

    RAMESH POLINENI New Member

    GST TAX IS = INPUT CREDIT- OUTPUTTAX

    in sictuation A he is collecting gst on gst input so this is not correct that is
     
    Last edited: Jul 27, 2017
  3. RAMESH POLINENI

    RAMESH POLINENI New Member

    calculation B =45-49.50 =4.90

    so sictuation B is absolutely correct
     
    Last edited: Jul 27, 2017
  4. RAMESH POLINENI

    RAMESH POLINENI New Member

    SICTUATION B IS CORRECT
     
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