Page 10 - F6 Slide - VAT Part 4 - Lecture Day 5
P. 10
Deemed Supply:
Indemnity Payments
14/114
Value of supply x consideration received
x % that relates to taxable supplies
Time of supply date of receipt of that payment or the
date of payment to another person
• Insurer replaces damaged/stolen goods = NO output tax
consequences (no indemnity payment)
• Payment is made to a 3rd party to indemnify the vendor =
vendor has to pay output tax
