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Frequently Asked Questions on VAT

Last updated on 06 April, 2018


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How can VAT be claimed?

Registered businesses whose input VAT (tax applied on the purchase of goods or services) is more than their output VAT (tax applied on the sale of goods or services) should indicate on their tax returns that they are eligible to receive VAT refunds.

VAT can be claimed under these scenarios:

Input tax paid on expenses related to taxable supply Fully recoverable by the registered VAT person
Input tax paid on expenses related to non-taxable/exempt supply May not be recoverable by the registered VAT person
Input tax paid on expenses related to both taxable and non-taxable/exempt supply Recoverable on a proportionate basis by the registered VAT person.
The registered person needs to apportion their input tax between the taxable and non-taxable/exempt supplies.
Businesses will be expected to use input tax (ratio of recoverable to total) as a basis for apportionment. Other methods may be used if they are fair and agreed upon by the Federal Tax Authority (FTA).
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