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12-13.VAT II - en
12-13.VAT II - en
Objectives
At the end of this lesson, students will be able to
understand:
Time of Supply
Tax Rate and Tax Base
Input and Output Taxes
Creditable Input Tax
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Lesson Plan (2)
Objectives
At the end of this lesson, students will be able to
understand:
Mixed Taxable and Non-Taxable Supplies Input Tax
Non-Creditable Input Tax
VAT Refund
Tax Invoice
Activities/ Methodology
Lecture, individual practice and quiz
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Time of supply
(Art. 62, LoT)
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Time of supply (con’t)
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Time of supply (con’t)
Where:
• Goods are supplied under a rental agreement
• Goods or services are supplied under an agreement or law which
provides for periodic payments
• There is a continuous supply of services
The goods or services are treated as successively supplied
for successive parts of the period of the agreement, and the
time of supply of each successive supply occurs on the
earlier date in which the payment is due or received.
The time of supply of import goods, is the time by which the
importer files a declaration and the customs duty and other
import charges are paid.
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Tax Rate and Tax Base
(Art. 61, 64, LoT )
Tax Rate
• 10% for imports and domestic supply
• 0% for exports
Tax Base/Taxable Value
• Import = CIF + Customs Duty + Excise Tax (if any)
• Supply of Goods or Services = The price of goods
or services that the supplier charges the customers.
• The making of a gift or sell at a lower price = Fair
Market Value
• Where the taxable values of goods or services
cannot be determined, the Tax Administration may
determine them (based on arm’s length principle).
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Input and Output Tax
(Art. 65-66, LoT)
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Creditable Input Tax
(Art.68, LOT)
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Creditable Input Tax (con’t)
Example 1: VAT Due:
Import of goods in Oct 2010:
Taxable Value/Tax Base = 1000
VAT (input tax 10% paid to Customs Depart.) = 100
Business expenses = 200
VAT 10% charged by domestic suppliers = 20
Sale to customers with a profit
Taxable Value/Tax Base = 1,500
VAT (output tax 10% charged to customers ) = 150
Filing a VAT return:
Fill in the box for output tax = 150
Fill in the box for input tax (100 + 20) = (120)
VAT Due = 30
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Creditable Input Tax (con’t)
Example 2: VAT Credit Carried Forward:
Import of goods in Nov 2010:
Taxable Value/Tax Base = 1000
VAT (input tax 10% paid to Customs Depart.) = 100
Business expenses = 200
VAT 10% charged by domestic suppliers = 20
Sale to customers as the price has been dropped
Taxable Value/Tax Base = 950
VAT (output tax 10% charged to customers ) = 95
Filing a VAT return:
Fill in the box for output tax = 95
Fill in the box for input tax (100 + 20) = (120)
VAT Credit Carry Forward = (25)
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Mixed Taxable and Non-Taxable Supplies Input
Tax (Sd. VAT Art. 33)
The amount of credit allowable of mixed taxable and
non-taxable supplies input tax is calculated by formula:
= A × B/C
• A: the total amount of input tax for the period;
•B: the total value of taxable supplies exclusive
of VAT made by the taxable person during the
period
•C: the total value of taxable and non-taxable
supplies exclusive of VAT made by the taxable
person during the period other than the value of a
non-taxable supply of the transfer of a business. 13
Mixed Taxable and Non-Taxable Supplies Input
Tax (con’t)
Subject to apply the above formula where the fraction of
B/C is between 0.05 to 0.95;
Where the fraction of B/C is less than 0.05, the input tax
shall not be allowed as input tax credit for the month;
Where the fraction of B/C is more than 0.95, all input
tax shall be allowed as input tax credit for the month;
In some circumstances, the GDT may allow to use an
alternative method by separating input tax for taxable
and non-taxable supplies, if it is possible; or use the
above formula A × B/C, if it is difficult to separate.
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Mixed Taxable and Non-Taxable Supplies Input
Tax (con’t)
Annual Calculation of Deductible Input Tax
In the first month of the following calendar year, the taxable
person who has made a calculation input tax by applying
the formula A × B/C, he/she shall calculate the deductible
input tax of the previous calendar year by using the above
formula based on the total of annual amount of:
• A: Non-attributable input tax;
• B: Taxable supplies exclusive of VAT;
• C: Taxable supplies exclusive of VAT and non-taxable
supplies, other than a non-taxable supply of the transfer
of a business.
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Mixed Taxable and Non-Taxable Supply Input
Tax (con’t)
Annual Adjustment of Deductible Input Tax
Where the calendar year credit is:
• More than the return credit, the balance shall be
regarded as a credit in the first month of the
following calendar year;
• Less than the return credit, the balance shall be
regarded as tax debit which is to be paid through
the tax return for the first month of the following
calendar year.
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Non-Creditable Input Tax
(Art. 69, LoT)
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VAT Refund (con’t)
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VAT Refund (con’t)
The claim for VAT refund of diplomatic missions and
international organizations shall be conditioned as
follows:
The claim must be in the form prescribed by the GDT;
Tax paid on goods purchased from taxable person;
Each purchase invoice shall have a total amount exclusive of
tax of 200,000 Riels and over;
Each claim shall have a total amount exclusive of tax of
1,000,000 Riels and over;
The claim may be made once a month only;
The GDT shall serve a notice of the acceptance or refusal to
refund the tax within one month of the receipt of the claim.
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VAT Invoice
Requirement for Tax Invoice (Art. 77, LoT)
When a supply is made to another registered taxable
person, a tax invoice must be issued
The tax invoice issued must be serial numbered
A tax invoice must be titled “Value Added Tax Invoice”
A VAT registered taxable person has the right to require
another VAT taxable person to provide a tax invoice in
respect of any supply of goods or services.
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VAT Invoice (Con’t)
Content of Tax Invoice (Art. 77, LoT )
Tax invoice shall comprise of:
The name, address, and VAT registration number of the
seller,
The name, address and registration of the purchaser,
Date of issue of the invoice,
Date when goods or services were supplied
Description, quantity, selling price of each type of goods
or services
Total value to calculate VAT
The amount of VAT payable.
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VAT Invoice (Con’t)
Procedure for Issuing Tax Invoice (Art. 77, LoT)
A registered taxable person who fails to provide a tax
invoice to another registered taxable person shall be liable
to a penalty as stated in the LoT.
A registered taxable person must not issue a tax invoice to
a non-registered person, but issue a commercial invoice or
other voucher to that non-registered person
A registered taxable person making taxable supplies shall
retain a copy of the tax invoices, commercial invoices or
other documents issued to his/her customers
Registered taxable person who make taxable supply shall
keep recorded tax invoices as well as other document
related to the supplies..
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Tax Liability Becomes Due?
Situation Answer
1. In October 2011, BBA (Cambodia) Co. made a selling
contract with a customer for $100,000 inclusive of VAT.
The products will be delivered that customer at the end of
December 2011. The customer deposited $20,000 on the
date of signing the contract. How much VAT is due for the
month of October 2011?
2. ESP Electronic Shop is a real regime taxpayer which is
solely owned by Sok. Beside owning this shop, he is also
investing in a new five star hotel in Siem Reap. On 30
October 2011, he sent electrical equipment from his shop
to use for the new hotel at cost of $12,000. If he sells the
electrical equipment to customers based on market price,
he could earn $15,000 in revenue VAT inclusive. When
and How much VAT is due ?
3. MDE Cambodia Co., enters into an installment sales of
factory machine inclusive of VAT for $150,000 with a 12
months installment payment starting from the end of
October 2011. The down payment of $30,000 was made
on 1 October 2011 with the agreement contract signed on
the same date.
What is the VAT liability for October 2011?
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End of Lecture II
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