There are many FAQs about VAT that people want answers to. To define VAT in simple words, it is the consumption of tax throughout Bangladesh, imposed on almost everything sold in the country regulated by NBR (National Board of Revenue). There are specific rules around specific products, which you must follow carefully to be tax compliant if you are a business owner.
So if you sell products to a customer in Bangladesh, you must charge the VAT rate decided by the Government.
VAT is collected on goods and services. On goods, VAT is collected at three stages: import stage, manufacturing stage, and trading stage.
On services, VAT is paid whenever service is availed.
So the first FAQs about VAT is, “Why should I pay VAT?”
Well, legally speaking, you have no other option but to pay your Value Added Taxes on time if you don’t want to face any legal issues in the future.
Also, the development of our country won’t be possible without the money received from VAT collections.
Many people want to know, “Is the VAT procedure too complicated?”
In a way, it is, but if you study it for once, it shouldn’t be tough for you to understand the VAT procedure.
If you are a regular consumer then just know that, if you purchase goods from a company that is eligible to pay NBR VAT, then you would have to pay your share of the VAT.
From there, it’s the company that you just purchased from that takes the lead. This FAQ about VAT is something that people ask most often!
So now, if you are one of those companies dealing with VAT, you need to know that, in association with the law and relevant rules of NBR, you would be expected to pay VAT on the sales that you made.
If you are looking to simplify your VAT procedure then NBR enlisted VAT software like Southtech’s EasyVAT can be your solution.
Wanna know more about EasyVAT?
Another question that people have a lot of confusion about is, “What is a Business Identification Number (BIN)”
BIN is the business identification number taken by an individual on the basis of the turnover of his economic activities. This identification number can’t determine the nature and activities of the individual’s financial activities.
It is a unique 9 digits by which a taxpayer can be identified. A tax payer’s state of business affairs can be identified through this number from the website of NBR for any future references.
So, “What is the responsibility of a VAT consumer?”
As a consumer, your responsibility is to collect and check the invoice from the seller during purchase. So when you get the receipt after making a payment, make sure to check the VAT details mentioned in the receipt. Also, look for the Mushak (VAT registration number) number in the printed receipt.
Also, look for the VAT registration number mentioned on the receipt. Identifying the VAT registration number is a sure-shot way of ensuring that your hard-earned money that you just spent is not being unethically used.
Another FAQs about VAT that many people have is, “How do I know VAT is applicable to my business?
Well to answer this FAQ about VAT, if your business is eligible to pay VAT or not will completely depend on your annual turnover. According to NBR, businesses with over BDT 3 Crore turnover rate must pay VAT. If your business falls under that then you have to pay your due VAT!
It’s understandable that people might have a lot of queries regarding VAT as this is not a topic that is vastly discussed or has easily accessible information available. However, here at Southtech, we aim to help you with your business needs. So keep an eye on our website and soon there could be more info to help you with your VAT queries!