Term Open Market Value (OMV) under GST

Posted on 10 June 2022 Category : GST terms

What is Open Market Value (OMV) under GST

This post explains about Open Market Value (OMV) under GST.

Open market

Open market Valuation of Goods or Services in GST

Open market value of a supply of goods or services or both means the full value in money, (excluding GST & cess) where the supplier and the recipient of the supply are not related and price is the sole consideration, to obtain such supply at the same time when the supply being valued is made.

Open Market Value (OMV) is an opinion of the best price at which the sale of an interest in an asset would have been completed unconditionally for cash consideration on the date of valuation, assuming:

a willing seller;
that, prior to the date of valuation, there had been a reasonable period (having regard to the nature of the asset and state of the market) for the proper marketing of the interest, for the agreement of price and terms and for the completion of the sale;
that the state of the market, level of values and other circumstances were, on any earlier assumed date of exchange of contracts, the same as on the date of valuation;
that no account is taken of any additional bid by a purchaser with a special interest; and
That both parties to the transaction had acted knowledgeably, prudently and without compulsion.

The open market value has below important components,

i) Value for a transaction when Supplier & recipient are not related will be taken

ii) In case of such transaction price should be sole consideration

iii) The comparable transaction should be at the same time

iv) The value will not include any taxes & cess.

The information provided here is about Open Market Value (OMV) under GST. If you would you like to add more information about Open Market Value (OMV) under GST, share below your thoughts.

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