General Terminologies of VAT

Term	Description
Input Tax	This is the tax paid on purchases
Output Tax	This is the tax charged on sales
Input Credit	The excess amount of Input tax over output tax for the current period which is permitted to be set off against Output tax of subsequent periods is termed as Input Credit.
TIN	Tax Identification Number (TIN) is the Registration Number given by the department to the dealer at the time of  Registration. This needs to be quoted at all required places where the registration details are to be provided.
Tax Invoice	This is the Sales invoice format issued by one Registered Dealer to another. Based on this Invoice, the ITC can be claimed by the purchasing dealer.
Retail Invoice	The Sales invoice format used for invoicing the Exempted Sales and the Sales made to Unregistered dealers is termed as Retail Invoice.
Registered Dealer	This term is used to identify a dealer who is registered either under Voluntary Registration or Compulsory Registration under the VAT Act. Such dealer can issue tax invoice and also claim the tax paid on purchases made from other registered dealers as Input tax credit.
Unregistered Dealer	Dealers who are not registered under the VAT Act are called as Unregistered Dealers (URD). Such dealers cannot issue tax invoice. They can neither Charge Tax nor Claim Input Tax Credit.
Purchase Tax	The Tax paid on goods purchased from unregistered dealers is liable to Purchase Tax. The purchase tax is treated as Output VAT payable by the dealer as it is a liability. It has to be paid while making the payment towards VAT liability. Based on the Rules and Regulations, the Input Tax Credit can be claimed on the payment made towards Purchase Tax.