Tamil Nadu VAT and TIN Registration

Value Added Tax (VAT) levies on the value added to the commodity during the production and distribution process. At each stage in the value chain, the dealer collects TNVAT for the sales. The dealer shall retain the tax paid on the purchase and pays the balance to the Government Treasury. Thus the final VAT liability passes onto the buyer or to the end customer. The State Governments in India validate the VAT Tax. Thus, the State Governments acquire sovereign rights to determine tax rates and compliance requirements for each state. In this article, let’s look at VAT & TIN Registration along with VAT return filing in Tamil Nadu.

Tamil Nadu VAT Registration

The registration for VAT applies to individuals upon purchasing or selling goods within Tamil Nadu. The registration applies irrespective of business entity. It also applies when the turnover of the entity reaches greater than or equal to Rs.5 lakh p.a. The VAT shall apply for the business entity if the turnover of the entity reaches greater than or equal to Rs.10 lakh p.a. The regulations for VAT shall become applicable implemented and governed by the Tamil Nadu VAT Act 2006. The Act applies to the entire state of Tamil Nadu. However, the Act mandates the registration of VAT irrespective of the quantum of turnover. The following shall require VAT:

Jewellers or Bullion Traders
Factors, Brokers, Commission Agents
Mercantile Agents
Non-Resident Agents or their Principal
Auctioneers
Importers
Exporters
Dealers making purchases against C Form

In addition to the above, any entity establishing a business can apply for registration in Tamil Nadu. Obtaining VAT Registration in Tamil Nadu takes within a week. There may be instances where the applicant registered for VAT and yet to receive the confirmation. During those circumstances, if the application crossed 30 days, the registration shall be treated as approved.

During registration of VAT, the applicants receive Tax-Payer Identification Number (TIN) number. TIN operates as a unique number and allotted by the State Governments Commercial Tax department. The first two digits of the TIN Number represent the State of Registration. All the dealers shall quote the TIN number on all correspondence regarding the VAT Registration. Therefore, VAT Registration and TIN Registration can be used synonymously, as they mean the same.

Tamil Nadu VAT Rate

The Tamil Nadu VAT rate can be divided into three categories:

Items in Part A of Schedule I,
Goods referred to Part B of Schedule I and
Items mentioned in Part C of Schedule I.

The following mentions Tamil Nadu VAT (tnvat) rate for each category:

Goods in Part A of Schedule I taxed at 1% - (i.e, Gold, Silver, Precious Metals, Jewellery, etc.,)
Items mentioned in Part B of Schedule I taxed at 5% (i.e, Utensils, Coffee beans and seeds, computer stationery, pipes, printed materials like diary & calendar, etc.,)
Items referred to Part C of Schedule I taxed at 14.5% (Air conditioners, bakery products, cement, cosmetics, dry fruits, electronic toys and games, etc.,)

Click here to

Download Complete Tamil Nadu VAT Rate Schedule.

Return Filing

The applicant shall file the tnvat return monthly. The applicant can file tnvat returns manually or through e-filings. Persons or entities having a turnover of Rs.2 crores or in the previous year shall file their monthly vat return on the 20th of each month for the previous month. Those having a turnover of more than Rs.2 crores are required to file their monthly TN VAT monthly return on the 22nd of each month for the previous month. Further, those dealers who are not liable to pay VAT tax should file their return annually before the 20th day of May.

Payments

The end customer pays the VAT. Therefore, it is the responsibility of the dealer to collect VAT tax on his/her sales and remit the same with the Sales Tax department before the due date. Dealers having an annual turnover of Rs.2 crores or more must make their VAT payment/deposit through the electronic VAT e-payment facility before the 22nd of each month. All others shall remit the VAT payment or deposit by the 20th of each month.

To obtain Tamil Nadu VAT Registration or File VAT Return in Tamil Nadu, visit IndiaFilings.com

Back to Learn

Frequently Asked Questions

Common questions about Tamil Nadu VAT Registration & TIN Services.

Tamil Nadu VAT Registration is a mandatory process for businesses operating in Tamil Nadu that involves obtaining a Tax Payer Identification Number (TIN) from the Commercial Tax Department. This registration is required for individuals or entities engaged in the purchase or sale of goods within Tamil Nadu, irrespective of their business entity, once their annual turnover reaches or exceeds Rs. 5 lakhs for individuals or Rs. 10 lakhs for business entities.

According to the Tamil Nadu VAT Act 2006, the following entities are required to register for VAT in Tamil Nadu: jewellers or bullion traders, factors, brokers, commission agents, mercantile agents, non-resident agents or their principals, auctioneers, importers, exporters, dealers making purchases against C Form, and any entity establishing a new business in Tamil Nadu, regardless of their turnover.

The TIN (Tax Payer Identification Number) is a unique number allotted by the State Government's Commercial Tax Department during the VAT registration process. It serves as an identification number for all correspondence and transactions related to VAT in Tamil Nadu. The first two digits of the TIN represent the state of registration.

Tamil Nadu VAT rates are divided into three categories based on the goods listed in the respective schedules of the Tamil Nadu VAT Act. Goods in Part A of Schedule I are taxed at 1%, items in Part B of Schedule I are taxed at 5%, and items in Part C of Schedule I are taxed at 14.5%.

The frequency of filing Tamil Nadu VAT returns depends on the dealer's annual turnover. Dealers with an annual turnover of Rs. 2 crores or more in the previous year must file their monthly VAT return by the 22nd of each month for the preceding month. Dealers with an annual turnover below Rs. 2 crores must file their monthly VAT return by the 20th of each month for the preceding month. Additionally, dealers not liable to pay VAT tax must file their return annually before the 20th of May.

Dealers with an annual turnover of Rs. 2 crores or more must make their VAT payment or deposit through the electronic VAT e-payment facility before the 22nd of each month. All other dealers must remit their VAT payment or deposit by the 20th of each month.

The primary purpose of VAT registration in Tamil Nadu is to ensure compliance with the Tamil Nadu VAT Act 2006 and enable the State Government to collect Value Added Tax on the sale of goods within the state. This registration system helps the government track and tax the value added at each stage of the production and distribution process.

No, VAT Registration in Tamil Nadu is not mandatory for all businesses. It is required only for individuals or entities engaged in the purchase or sale of goods within Tamil Nadu once their annual turnover reaches or exceeds the prescribed threshold (Rs. 5 lakhs for individuals or Rs. 10 lakhs for business entities). However, certain categories of businesses, such as jewellers, importers, and exporters, are required to register for VAT regardless of their turnover.

The VAT e-payment facility in Tamil Nadu is a convenient and secure method for dealers with an annual turnover of Rs. 2 crores or more to make their VAT payments or deposits electronically. This facility streamlines the payment process and ensures timely remittance of VAT to the State Government.

Yes, according to the Tamil Nadu VAT Act, if an applicant has applied for VAT Registration but has not received confirmation within 30 days of the application, the registration shall be treated as approved. This provision ensures that businesses can commence operations without undue delay while awaiting formal approval.