CH- PARTIAL EXEMPTION

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CH - 12 - PARTIAL EXEMPTION

Formula to determine % recovery:

Taxable supplies value (minus capital goods)/ Tx. sup (minus capital goods) + Exempt sup. = %

To exclude from calculation:

Capital goods (L&B, PCs, )

Self-supplies

outside scope transaction

DE MINIMUS INPUT VAT RULE

VAT on exempt trans. can be recovered if total exempt input tax is less than or equal to:

Threshold 625 pounds p.m. and

less than 50% of total input tax

ANNUAL ADJTS. - when to account for - depending on Stagger group!!

A/C for on the firs VAT return of the new year or :

Final return of the VAT year rather than wait until the first return of the new year.

EXCEPTIONS:

CAPITAL GOODS SCHEME:

Adj. will be done ---> 2nd VAT return following the end of the VAT yr.

CH- 26 L&B - OPTION TO TAX

Land (any sort of land, ie.: farmers's land : exempt , therefore, option to tax

Domestic building (eg: terraced house): exempt, but, domestic, therefore no option to tax

Cial. lease building (e.g: 5 year old factory) : cial. + lease : exempt, option to tax available.

freehold sale 1 yr. old office block: Stand Rate

99 year lease of 1 yr. old shop: Cial+ lease: exempt, option to tax available.

Notes: gran of a lease -cial. building + lease: exempt supply. option to tax available.

Freehold @ SR. >3yrs old.

uncompleted cial. building

new cial. building

LEASE - CIAL PROPERTY = EXEMPT

PREMIUM+RENTAL INCOME ON CIAL PROP.= EXEMPT + OPT. TO TAX AVAL.