VAT - what is it and how to calculate it?

VAT - what is it? This article will be devoted to our article, in which we will talk about why this tax is set, describe its features. The value - added tax is indirect and is one of the most important ways of replenishing the Russian state treasury. Everyone who wants to do business in detail should know about it. So, let's start studying VAT!

What it is?

The so-called added value is actually present at all stages of production of goods: from the very beginning of their manufacture to the moment of their purchase by the consumer.

The enterprise pays the tax on this most additional mark-up from its amount of the increase in value. If to explain in simple words, it is calculated as follows: the proceeds from the sale of goods minus the amount of costs for 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 enterprise is obliged to expose in the account to the customers and buyers the value-added tax, but the firm does not receive it - this tax is entirely spent in the state treasury.

VAT - what is this in terms of calculations?

In accordance with the laws of our country, the value added tax is calculated as follows: "tax at a rate with a tax base" minus the amount of tax deductions. "

Tax deduction is the sum of all taxes paid upon the purchase of all necessary materials and services for the company's work (taxable VAT).

VAT is considered separately for each rate, excluding those types of goods and services that are not subject to taxation.

What is the current VAT in the Russian Federation?

In 1992, VAT was introduced in Russia. Over the years, his rate has changed many times and reached even 28 percent. In 2004, the Government decided to reduce it to 18 percent. Individual categories of taxpayers are exempt from VAT - for example, organizations that have switched to a simplified taxation system.

Groups of goods are also defined, in which the VAT rate is lowered: for example, some products for children and products. The enterprises producing goods for export do not pay VAT. Other services not subject to this monetary burden, you will tell the tax.

"VAT will be reduced or even canceled" - now, such headlines 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 in general - too large revenues to the budget are related to the value-added tax. Think about this circus - 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 get acquainted with the tax rates of exactly the products you manufacture or sell, and calculate VAT specifically in your case. Successful work!