Podcast
Questions and Answers
What is the annual sales amount threshold for goods or services to be VAT-exempt?
What is the annual sales amount threshold for goods or services to be VAT-exempt?
Which government agency is responsible for the post audit of exemptions claimed under the VAT provision?
Which government agency is responsible for the post audit of exemptions claimed under the VAT provision?
What does 'input tax' refer to in the context of VAT regulations?
What does 'input tax' refer to in the context of VAT regulations?
The term 'output tax' in VAT regulations relates to tax due on which transactions?
The term 'output tax' in VAT regulations relates to tax due on which transactions?
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What should be adjusted using the consumer price index every three years?
What should be adjusted using the consumer price index every three years?
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For VAT-exempt sales, what are buyers not allowed in relation to tax?
For VAT-exempt sales, what are buyers not allowed in relation to tax?
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Which transactions are exempted from VAT according to the NIRC?
Which transactions are exempted from VAT according to the NIRC?
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In the context of VAT exemptions, what is considered 'in their original state'?
In the context of VAT exemptions, what is considered 'in their original state'?
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Which of the following is not exempted from VAT under the NIRC regulations?
Which of the following is not exempted from VAT under the NIRC regulations?
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What is the consequence of having excess input VAT or output VAT?
What is the consequence of having excess input VAT or output VAT?
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Which of the following processed food items is considered 'in their original state'?
Which of the following processed food items is considered 'in their original state'?
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What types of properties are generally exempted from VAT according to the NIRC?
What types of properties are generally exempted from VAT according to the NIRC?
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What percentage of the input VAT on the janitorial services can EFG Corporation claim?
What percentage of the input VAT on the janitorial services can EFG Corporation claim?
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When is input VAT on domestic purchase of goods creditable to the purchaser?
When is input VAT on domestic purchase of goods creditable to the purchaser?
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Under what conditions can input VAT on domestic purchases be claimed?
Under what conditions can input VAT on domestic purchases be claimed?
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Which of the following is NOT a condition for consummation of a sale under the NIRC?
Which of the following is NOT a condition for consummation of a sale under the NIRC?
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In what scenarios can input VAT on domestic purchase of goods be creditable to the purchaser?
In what scenarios can input VAT on domestic purchase of goods be creditable to the purchaser?
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What must happen for a purchase of goods to be considered for conversion into or intended to form part of a finished product for sale?
What must happen for a purchase of goods to be considered for conversion into or intended to form part of a finished product for sale?
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Study Notes
VAT-Exempt Transactions
- Certain sales, barters, exchanges, or leases of properties are exempt from VAT, as specified in the NIRC.
- Examples of VAT-exempt transactions include:
- Sale or importation of agricultural and marine food products in their original state.
- Sale or importation of livestock and poultry, or breeding stock and genetic materials.
Input VAT and Output VAT
- Input tax refers to the VAT paid by a VAT-registered person on importation of goods, local purchase of goods or services, or lease or use of property from a VAT-registered person.
- Output tax refers to the VAT due on the sale or lease of taxable goods or properties or services by a VAT-registered person.
- Excess input VAT can be credited to the VAT-registered person, while excess output VAT is payable to the BIR.
Claiming Input VAT
- Input VAT is creditable to the purchaser upon consummation of the sale of goods or properties.
- Consummation occurs when the parties perform their respective undertakings under the contract of sale, culminating in its extinguishment.
- Examples of purchases that can claim input VAT include:
- Goods for sale.
- Goods for conversion into or intended to form part of a finished product for sale, including packaging materials.
- Goods for use as supplies in the course of business.
- Goods for use as materials supplied in the sale of service.
- Goods for use in trade or business.
VAT Refund
- The process of VAT refund is possible when there is excess input VAT.
VAT-Registered Persons
- VAT-registered persons can claim input VAT credits on their purchases.
- VAT-registered persons are required to pay output VAT on their sales.
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Description
This quiz covers VAT-exempt transactions, input VAT and output VAT distinctions, consequences of excess input or output VAT, and the process of VAT refund as per Sections 109-112 of the NIRC. Test your knowledge on exemptions, credits, and refunds related to VAT.
