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What is CST?

CST mean Central Sales Tax

It is tax on sale of goods outside state

 

What is CST Payable

Tax on Cst Sales is called Output CST

This Output Cst is called CST Payable

Note:-

While computing Vat,we do Output Vat-Input Vat

but in CST,Output CST is CST Payable

(Input CST is not reduced)

 

Difference between VAT and CST

VATCST
It is a tax on sale of gooods within stateIt is a tax on sale of gooods outside state
  
Vat ComputationCST Computation
Output VatOutput Cst
Less 
Input Vat 
Vat PayableCST Payable

 

Hence there is no Input Cst

 

 

Case 4A

Suppose a dealer makes CST purchase and sales as follows

Purchase

C LTD
Purchase50000
Cst 2%1000
 51000

 Sale

Z LTD
Sale120000
Cst 2%2400
 122400

What is  cst payable?

-a-

Cst payable=Output Cst=2400

-ea-

 

Case 4B

Suppose a dealer makes CST purchase and sales as follows

Purchase

C LTD
Purchase50000
Cst 2%1000
 51000

Sale

Z LTD
Sale30000
Cst 2%600
 30600

What is  cst payable?

-a-

Cst payable=Output Cst=600

Hence even if CST sales less than CST purchases,then also CST Payable

-ea-

 

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CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 6 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com.
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