WHAT IS VAT?
VAT is an abbreviation for Value Added Tax. This type of tax is charged by the Central Government on the sale of goods and services when they are ultimately sold to the final consumers. Value Added Tax is charged and paid by the producers of the goods and services but it is finally levied on consumers who purchase the goods and services when they pay for them.
WHAT IS VAT REGISTRATION?
VAT Registration is made compulsory as well as important for all those manufacturers who are solely involved in the process of production of goods and services. VAT Registration means the process of listing with the Government as a company eligible for the return of VAT. A person may get confused between VAT and sales tax since both taxes are related with the sale of goods and services. But sales tax is charged only once when the end user purchases the goods or services. On the other hand, VAT is charged at different levels of production hence it is called a multipoint tax.
The VAT Registration Act has made it compulsory for all business organisations to get themselves registered for VAT payments. Nowadays, VAT Registration can be done online and it is becoming popular among business entrepreneurs since it is easy and time effective.