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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Value of Supply

Which of the following is a condition that must be met, in addition to a pre-existing agreement linked to invoices, for a discount given after the supply to be excluded from value under Section 15(3)(b)?

The recipient must reverse the input tax credit attributable to the discount, based on the document issued by the supplier. This is the second condition under Section 15(3)(b), alongside an agreement made at or before supply and specifically linked to relevant invoices.

  1. AThe supplier must obtain written approval from the proper officer
  2. BThe discount must not exceed 10% of the invoice value
  3. CThe recipient must reverse input tax credit attributable to the discount on the basis of the document issued by the supplierCorrect
  4. DThe recipient must be a related person of the supplier

Explanation

Section 15(3)(b)(ii) requires that input tax credit attributable to the discount, based on the supplier's document, has been reversed by the recipient. The Act sets no percentage cap and no officer approval, and relatedness is not a condition.

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