VAT - what is it? Our article will be devoted to this topic, in which we will talk about why this tax is established , and describe its features. Value added tax is indirect and is one of the most important ways to replenish the Russian state treasury. Everyone who wants to do business should know about it in detail. So, let's start the study of VAT!
What it is?
The so-called added value is present at virtually all stages of the production of goods: from the very beginning of their manufacture to the time they are purchased by the consumer.
The company pays tax on this additional margin from its amount of the increase in value. To explain in simple words, it is calculated as follows: revenue from the sale of goods minus the sum of the costs of raw materials for production (if it was purchased from a third-party seller). There is also a list of goods and services not subject to this burden.
The company is obliged to invoice its customers and customers with a value-added tax, but the company itself does not receive it - this tax is entirely transferred to the state treasury.
VAT - what is it from the point of view of calculations?
In accordance with the laws of our country, value added tax is calculated as follows: "tax at a rate with a tax base" minus "the amount of tax deductions."
A tax deduction is the sum of all taxes paid upon the purchase of all necessary materials and services for the operation of a company (taxable with VAT).
VAT is considered separately at each rate, excluding those types of goods and services that are not taxable.
What VAT is accepted today in the Russian Federation?
In 1992, VAT was introduced in Russia. Over the years, his rate has repeatedly changed and reached even 28 percent. In 2004, the Government decided to reduce it to 18 percent. Certain categories of taxpayers are exempt from VAT - for example, organizations that have switched to a simplified taxation system.
Also defined are groups of goods for which the VAT rate is reduced: for example, some products for children and products. Enterprises producing goods for export do not pay VAT. Other services that are not subject to this monetary burden will be prompted by the tax authorities.
“VAT will be reduced or completely canceled” - now such headings can often be found in economic publications of the media. However, we dare to assume that this will not happen not only in the coming years, but never at all - too large revenues to the budget are associated with value added tax. Think about this cirf - 25 percent of the entire budget of the Russian Federation is formed by paying this particular tax.
So we answered the most common questions about VAT: what is it, who should pay it and how to calculate it. Now you need to familiarize yourself with the tax rates of exactly the products you are manufacturing or selling, and calculate the VAT specifically in your case. Have a good work!