Page 18 - Chapter 32 VAT Part 2

12.2. Deemed supply: Indemnity payment [s 8(8)]

- if vendor receives amount from his insurer (a claim) wrt

damage incurred in the course of the enterprise

Reason?

Short term insurance:

• - claim input wrt premium paid

• - charge output wrt claim paid by the insurer

Long term insurance:

• - exempt financial service [refer s 2(1)(i)]

• - no input, no output