Page 28 - F1 Integrated Workbook STUDENT 2018
P. 28
Chapter 1
It is important to identify the type of supply in order to claim back input tax.
Input tax can only be claimed back on taxable supplies, i.e. zero and standard rated
goods and services. Exempt supplies are outside the VAT system and VAT cannot
be charged to customers but neither can the input tax on purchases be claimed back.
Taxable supplies, therefore, have a selling price exclusive of VAT (net price) and a
selling price inclusive of VAT (gross price).
If the exclusive price is given, VAT is calculated by:
Exclusive price × tax rate
If the inclusive price is given, VAT is calculated by:
(Inclusive price/(100 + tax rate)) × tax rate
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