VAT
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Government introduced legislation to tax goods directly at the point of sale. |
It is the responsibility of each business to register for VAT once the annual turnover limit has been reached |
Business owners take VAT from customers and pass it on to Inland Revenue |
Business representitives calculate the cost of bringing products into their place and condition |
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A suitable profit element is added to the cost to calculate the selling price |
17.5% is added to the selling price of goods, that the consumer pays to the business at the point of sale |
The business completes a monthly, quarterly or annual return that declares how much VAT has been collected |
The VAT paid on goods purchased for use in the business is deducted. |
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The net amount payable or receivable is paid or claimed |
The effect is that only the end user or consumer pays the VAT |
Business therefore ACT as ‘agents’ for the government |
There are inspections leading to fines and penalties for VAT fraud |
