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TAXATION: Value Added Tax (VAT) – INPUT VAT

A. Define Input Tax

1. Meaning of input tax

Input tax is the value- added tax due from or paid by a VAT registered person in the course of his trade or business on
importation of goods or local purchase of goods, properties or services, including lease or use of properties from a VAT
registered person. It shall also include the transitional input tax and the presumptive input tax

2. Four categories of creditable or deductible input taxes

a. VAT paid on local purchases (passed on by seller) or on importation (passed on VAT)

b. Presumptive input tax
c. Transitional input tax
d. Standard input tax

3. Persons who can avail of input tax credit

The input tax credit on importation of goods or local purchases of goods, properties or services by a VAT registered person
shall be creditable:
a. To the importer upon payment of VAT prior to the release of goods from custom custody
b. To the purchaser of the domestic goods or properties upon consummation of the sale or
c. To the purchaser of services or the lease or licensee upon payment of the compensation, rental or royalty or fee

B. Presumptive Input Tax

C. Transitional Input Tax

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TAXATION: Value Added Tax (VAT) – INPUT VAT

D. Standard Input Tax

E. Determination of Allowable Input Taxes

F. Sources of Creditable Input Taxes (Local Purchases or Importation)

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TAXATION: Value Added Tax (VAT) – INPUT VAT

G. Claimed for Input Tax on Depreciable Goods (Under RR 16-2005)

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TAXATION: Value Added Tax (VAT) – INPUT VAT

H. Deductibility of Depreciation Expenses as it Relates to Purchase of Vehicles and Other

Expenses Related Thereto, and Taxes Allowed (RR 12-2012)

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TAXATION: Value Added Tax (VAT) – INPUT VAT

I. Advance Payment of VAT

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TAXATION: Value Added Tax (VAT) – INPUT VAT

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TAXATION: Value Added Tax (VAT) – INPUT VAT