nat the ment oF GOCE sha eee
mn
y ere payment
sition les to the gov .
puture trans ding system on the sales to the government and GOCC wi
The final with veaive January 1, 2021 in favor of the tax creditabl
aban qystem. This would mean the elimination of the 7% standa
a" aT h favor of full creditability of input VAT on government or GOC
input
sales.
VAT CARRY-OVER ;
‘The input VAT carry-over is the excess of the input VAT over the output VAT
ina particular month or quarter. It is the VAT overpayment that appears
after tax credits and payments are deducted against the net VAT payable.
Rules on Input VAT carry-over
1. The input VAT carry-over of the prior quarter is deductible in the first
month of the current quarter.
2. The input VAT carry-over in the first month of the quarter is deductible in
the second month of the quarter.
3. The input VAT carry-over in the second month of a quarter is not
deductible to the third month of the quarter.
4, The input VAT carry-over of the prior quarter is deductible in the third
month quarterly balance of the present quarter.
Mustration 1
The following data relates to the regular sales of a VAT taxpayer:
Prior quarter *ps0.000 P350000
Current quarter :
qunonth ofcurrent quarter _P 120,000 P_ 100,000
3h mong Of current quarter 150,000 145,000
nth of current quarter 220,000 ___70,000
tte P.490,000 B.315,000
cre
edit rules of the input VAT carry-over shall be applied as follows:
Output varr Simon —‘T#month — 2e4month = month
s:Inputyar 380000 -P 120,000 p1so,000 P CO 00
Carry-over 420,000 yoo.o00 145.000 "19,
(240,000) —> __ 40,000
Input VAT carry over (B-20,000) > 29.000
Not an input VAT carry-over (P1500) ——55 00
mm var payable B.135,000
305
———aLt
~
segue NAT
car her non-VAT registered seller?
nate ee rscoce shall withhold a 3% final percentage tax on the
rove
oe pefore payment.
‘ition _ :
future ran ding system on the sales to the government and .
i, od fective January 1, 2021 in favor of the tax creditable
“ ae oe This would mean the elimination of the 7% standard
ar favor of full creditability of input VAT on government or GOCC
in|
sales.
INPUT VAT CARRY-OVER
The input VAT carry-over is the excess of the input VAT over the output VAT
in a particular month or quarter. It is the VAT overpayment that appears
after tax credits and payments are deducted against the net VAT payable.
Rules on Input VAT carry-over
1
+ The input VAT carry-over of the prior quarter is deductible in the first
month of the current quarter.
2. The input VAT carry-over in the first month of the quarter is deductible in
thesecond month of the quarter,
3. The input VAT carry-over in the second month of a quarter is not
, deductible to the third month ofthe quarter.
* The input VAT carry-over of the prior quarter is deductible in the third
month quarterly balance of the present quarter.
qustration 1
f
' following data Telates to the regular sales ofa VAT taxpayer:
Prior Output VAT — Input VA
Quarter
Curent quarter 2.250,000
* me : ‘
2s mon ent GUarter P 120,000 P 100,000
i“ ent qu;
30 Month ofan quarter 150,000 145,000
—220.000 ___70,000
P.490,000 p_315.000
The Credit
‘ules ofthe Input VAT carry-over shall be applied as follows:
Output y, 24 month st 4 month
IN 1*month — 24 month
ce Input vat P 350,000 P 120,000 ‘P150,000 PP 490009
""Y-over 420.000 100.000 145.000 315,
(240,000) -> “40.000 ----- >__40.000
Input VAT carry over
—>_ 20.000
(b_20,000)
Not an input VAT carry-over (P.15,000) ______
VAT payable B_135.000
305it VAT
Chapter 9 - Input
rter, first month and g
VAT in the prior qua! a econ
The taxpayer Will not Muarier since there is a negative VAT payable. The
month of aay P35 50 VAT in the third month of the current quarter,
taxpayer SI "
Note:
1. The P40,000 input VAT
2. a input VAT carry-over in the first month of the current quarter is ‘creditable
In the second month of the current quarter. 7
3, The P15,000 excess input VAT in the second month cannot be carried over to the third
" Thonth quarterly balance. Instead, the P40,000 deferred input VAT carry-over In the
preceding quarter is credited in the current quarterly balance.
camy-over inthe prior quarter is creditable in the first month ot
Mlustration 2
The following data relates to the regular sales of a VAT taxpayer:
Output VAT — Input VAT
2.360.000 P_400,000
Prior quarter
Current quarter:
1s month of current quarter’ P 160,000 P_ 100,000
2™4 month of current quarter 150,000° 160,000
3ré month of current quarter 170,000 65,000°
£490,000: P 325,000
The credit rules of the input VAT carry-over shall be applied as follows:
Prior quarter
Output var pycmnth d= month 2% month 34 month
Less: Input VAT ooo... P 160,000 ‘Pasoooo ‘p 4g0000
Carry-over ns, 200.000 160,000 325,000
VAT Payable TUTE Tea <> 40,000
Not an input var. carry-over (Pp apgan 20000
Note: :
1 40009 VAT payable p_95,000
var
3. The P40,009 pvt Month cannot | be avable in the first month, ‘The P10,000 exces
400 cary over inthe Ted Qver to the third months
nl Prior quarter is deductible in the third month
the P20, oaths
te 000 VAT paid et Trt mei duce inthe quartet ba
WHat ARE EX ‘ucted in the quarterly VAT pa)
‘CLUD}
1 Advanced VAT whe ROM INPUT ya
2. Input var ich have bees! 'T CARRY-OVER?
tab] en appli
4 fax refund or tax net? 22°0-ratel at a tax credit certificate
certificate !™ which have been apple’
306
forter I= Input VAT
7 7 attributable to zero-rated sales that expired after the two-
vA 1
inp escrptive period
y
Jes of advanced VAT will be discussed in the Succeeding chapter,
The rules 0!
ULES ON CLAIM FOR CREDIT OF INPUT VAT
Rt
1. Specific identification - input VAT that
can be traced to @ particular
sales transaction is credited against the output VAT of such sales
ut tax due or paid that cannot
be directly and entirely: attributed to any one of the sales transactions
shall be allocated Proportionately on the basis of sales
Illustration 1 - Specific Identification
A VAT taxpayer had the following sales with their corresponding directly
traceable input VAT during the month:
—Input VAT_
Sales to private entities P 900,000 P ” “60,000
Export sales 300,000 36,000
Sales to government 250,000 24,000
Sales of exempt goods ——100,000 ——-2.000
Tota B.1550,000 P_i22'009
The Creditable Input VAT may be computed directly as:
Input VAT on Private sales P 60,000
PPYLVAT on export salee 36,000
put ‘VAT on government sales (7% x P250,000) ——12,500
otal allowable (creditable) Input VAT
Input var deductible against Bross income through costs and expenses:
Input VAT on exem 0,
pt goods P
Tomas tPUtVAT fovernment) (P24,000~P17,500)____ 6500
Uustration 2
~Non-traceable input VAT ‘ing th
menpaver “n8aged in merchandising had the following transactions during the
Brempe sales P 200,000
saport sales 300,000
a t° Bovernment 100,000
quar Sales
otalChapter 9~ Input VAT
fi VAT
During the month, the taxpayer had P124,900 total Input that cannes 5
traced to a particular transaction.
The non-traceable input VAT shall be allocated as follows:
Sales Allocation Allocated
—Amount_ __Factor _ input var
Exempt sales P 200,000 P200K/PIM xP124,000=P 24209
Export sales 300,000 P300K/PIM xP124,000= 37.299
100,000 P100K/P1M xP124,000 = 12406
Sales to government
Regular sales 490,000 P400K/PIM xP124,000 =
Total sales 2.000.000 4
The creditable input VAT shall be:
Input VAT allocable to export sale P 37,200
one VAT (P100,000 x 7%) 700
allocabli 49500
bar] le to regular sales
Mlustration 3 -With Non-Traceable VAT
A taxpayer had the following sales reat ¥ aT ne
Sales Traceable
Exempt sales li
Teel sales P 200,000 P 12,000
° 181000
2 500.009
There is a P24,000 input tax that se ee
it either type of transaction.
The creditable input VAT shall be:
Input VAT directly traceable to vatable
Allocated input VAT to vatable sales sales P 18000
r (P300,000/PS00,000 x 24,000)
otal allowable (creditable) input VAT 14.490AT
i input V ALLOWABLE OR CREDITABLE INPUT VAT IN
PTH
10 0
RN i i T is computed and presented
eva ver awable (creditable) input VAT i Pp p
in pai as follows:
the’
in
i P XxXXxxx
i od.
from previous period
carry-over, exceeding P1M 100% HK
we inputtax on capital goods metoat
‘ransitional input tax XK, XXX
Presumptive bp ee
ilar input om: . XXKIOKK
ve archases of capital goods not exceeding: P1iM sooo
Purchase of capital goods exceeding P1! ; a voces
i f goods, other than capital goods
Domestic purchases of gi a n
Importation of goods, other than capital goods ea
Domestic purchases of services
Services rendered by non-residents. XXX
Others pet
Total available input tax eerie
less: Deductions from input tax .
Input tax on capital goods, deferred for future periods P xxx
Input tax on sales to gov't closed to expense XK XKK
Input tax allocable to exempt sales zegaron
Input VAT claimed as refunds/TCC 70K 200
Others KKK
Total allowable (creditable) input tax P20
Histration
VAT taxpayer had the following data during the month:
eitsto regular customers P 4,000,000
€ government. 1,000,000
ent sales 3,000,000
Total ata 2,000,000
. 10,000,000
peutvart 80,000
Deferred inant Ver, from prior period Pee o0
‘nut tax (already amortized for 21 /36 months) 2
Pure : 0
Inpent °f goods or services P 7,000,000 P 940.000
Phase of nee tulPment (8-year life) 1,200,000 x
600
depreciable goods 80,000 9Chapter 9 - Input VAT
pt sales
VAT traceable to exempt si
Anount applied for VAT refunds/TCC on export sales
Input VAT traceable to sales to the government
Amortization of deferred input VAT on capital goods
Input VAT on supplies
Total non-traceable input VAT
The creditable input VAT shall be computed in the VAT return as;
Input VAT carry-over, from prior period P 80,000
Deferred input VAT 75,000
Input VAT on purchase of goods or services 840,000
Input VAT on importation of equipment ——144.000
Total available input tax P 1,139,000
Less: Deductions from input tax
Deferred input VAT for succeeding period! P 211,600
Input VAT on exempt sales? 203,900
Input VAT on export sales applied for
refund or tax credit 150,000
Excess input VAT on sales to government? 23,350 ___ 588,850
Total allowable (creditable) input VAT P_ 550,150
Notes to allowable input VAT computation:
1. Amortization schedule on input tax on capital goods with monthly sare |
acquisition costs exceeding P1M: |
Beginning Allowable Ending
this month __Balanc—
From previous period P 75,000 P—s,000 P 70000
This period (60 months max.) 144.000 2.400
Total Bo 219.000 E7499 pus |
Note; |
1. The deferred input VAT from the Prior period shall be amortized over ere™ |
Tits, 36-21) unamortized months. Hence, Ppa 15=P5000. ye |
2. The P144,000 input VAT on the imported equipment must be amo! t
months. Hence, P144,000 + 60 = P2,400,
Input tax on exempt sales
Te
aa Rapa tax directly attributable to exempt sales P
ora cdo gh oF input tx not direc atrbatable ot
-000,000/10,000, i
Tova P2000, are n200.900 x P35,500) coe |
le to exempt sales i
1968erm
on VAT on sales to the government
inp
3, Boe jy attributable to government sales P 90,000
input aon of input tax not directly attributable
le
aa: Ratable PY 910,000,000 x P 35,500) ase
un oy atable to sales to the government P 93380
we Sudard input VAT (PIM government sales x 7%, 5)
tpt a onsales to government closed to expense 223.350
in > —20.000
This excess amount can be negative or positive. The amount is simply included in
seeomputation whether positive or negative.
Composition of Creditable Input VAT
1, Input VAT traceable to regular sales
2. Input VAT traceable to export sales that are not applied for tax refund or
tax credit
3, 7% of sales to government agencies or GOCCs
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