VAT Guide to Value Added Tax - sri lanka inland revenue ...

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26.6 VAT ON MICE Tourism VAT rate applicable to the services in relation to MICE tourism rendered by Professional Conference and Exhibition Organizers (PECO) is 10%. This is applicable to Professional Conference Organizers and Professional Exhibition Organizers only if they are members of the Sri Lanka Conventions Bureau. Lower rate is confined to MICE tourism only – ie Meetings, Incentive Travel, Conventions and exhibitions conducted by PEC00. 148
Chapter – 27 Some useful hints 1. Supply of goods i. Sale of goods by a partnership is treated as a sale by the body of persons although partnership is not a legal entity to own the goods and passing of exclusive ownership as the owner may not be present. The same is applied to the sale of fixed assets of the partnership. ii. Similarly sale of liquor etc. by a club to its members is treated as supply of goods. The management owns the goods and the ownership change hands when they are sold for a consideration to its members. The members cannot claim that they consume their own liquor/food. The same applies when a supply is made to a partner by a partnership. iii. In the same vein sale of stolen goods is liable to VAT not withstanding that sale is voidable and passing of exclusive ownership as the owner is absent. iv. Input tax incurred before registration for VAT is not allowable. v. Input tax paid after registration but in respect of supplies received before registration is also not allowed. vi. Input tax paid after registration but before the commencement of commercial operations (That is before the commencement of making taxable supplies) will be allowed because the definition of “taxable activity” includes any activity in connection with the commencement or cessation of a trade, business, profession, voccasion etc. Vide Para 3.7(i)(c ) This is provided in Section 22(7) of the Act subject to the conditions laid down therein. – Vide Para 11.4 vii. Goods stolen if covered by an insurance compensation is considered as a taxable supply. Insurance company must pay VAT. This may be considered under the second limb of the definition of supply of service para 3.3. viii. Samples supplied to actual or potential customers without any charge and not from items ordinarily available for sale and supplies for testing and market research without any charge are not taxable supplies. ix. Bartar transaction (i.e exchange of goods/services without cash payment or with part payment) should be considered as two separate supplies (because the consideration for a supply may be in money or otherwise than in money). If both parties are registered both should account for VAT. If only one party is registered he should account for VAT. Tax base is the market value of goods/services exchanged. 149
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But for the best to the September 0
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Preface The Value Added Tax Act was
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Chapter - 1 Introduction 1.1 Purpos
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However from the point of view of t
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The following test which has been a
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iv. Import of any fabric, yarn, gre
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Chapter - 3 The definitions of conc
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Eg. 1 : If “A” wants to termina
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c. Time of supply in relation to su
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Thus, any trade, business, etc. are
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a business in Sri Lanka and not to
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When the recipient is not a registe
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• There are two types of registra
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(ii) continued without making an ap
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(d) (e) (f) input credit has been c
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4.13 Activity Code Number “Suppli
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the H.S. classification it may be b
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5.8 Payment of tax on Assessments T
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5.11. Collection of VAT on Imports
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6.3 Approval For Deferment Facility
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iv. If an importer declares only pa
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6.6 Deferment on Local Supplies (Te
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7.4 Tax Invoice Tax invoice should
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7.11 Use of tax fraction to compute
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Lower Rate - 10% Goods and services
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Chapter - 9 Calculation of Tax 9.1
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accounted for in respect of all the
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transferred to a taxable activity a
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Eg. If A is an ice-cream vendor who
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(3) In the above case if the regist
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• claim (deduct) only the allowab
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• “Value of Supply” has to be
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VAT chargeable = 900,000 x 20% = 18
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• The Director General of Customs
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10.5.6 Milk - item (iv) • Liquid
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(i) Insurance - xi(i) • Only the
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in Sri Lanka and consumed in Sri La
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Chapter - 11 Refunds 11.1 Unlike in
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11.7 Set off of refunds against fut
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• To make an additional assessmen
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a genuine taxpayer who does not wis
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Penalties Tax payers should comply
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15.3 Keeping of records regarding e
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15.8 Example of a VAT Account VAT A
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the trading house or the other pers
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16.4 Concessions available to Expor
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v. Importation of services are not
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Chapter - 17 Hire Purchase Transact
Page 98 and 99: (a) Under the existing provisions V
Page 100 and 101: y the hire-purchase company to the
Page 102 and 103: Chapter - 18 Leasing & VAT 18.1 Lea
Page 104 and 105: installments. Any VAT not recovered
Page 106 and 107: 18.13 Leasing inputs • Leasing in
Page 108 and 109: 18.15 Leasing Advance Sometimes it
Page 110 and 111: Thus output tax of B on the termina
Page 112 and 113: Chapter - 19 Mortgages 19.1 Mortgag
Page 114 and 115: • Services provided by internatio
Page 116 and 117: Chapter - 21 Some Obligations Under
Page 118 and 119: However an adjusted figure must be
Page 120 and 121: Chapter 23 Construction Contracts 2
Page 122 and 123: Government agencies mentioned above
Page 124 and 125: Chapter - 24 Rulings 24.1 Following
Page 126 and 127: • None of the companies covered b
Page 128 and 129: which he has supplied to the garage
Page 130 and 131: instructions can be exempted if suc
Page 132 and 133: ii. iii. any other registration tha
Page 134 and 135: i. Membership fees and or subscript
Page 136 and 137: Chapter - 25 Zero Rated Supplies 25
Page 138 and 139: (ii) (iii) (iv) Services directly c
Page 140 and 141: Supply of facilities for crew chang
Page 142 and 143: 4. Yard to Port Transporting contai
Page 144 and 145: Chapter - 26 Travel Trade, Tourism
Page 146 and 147: ii. iii. But “travel insurance“
Page 150 and 151: x. Supply of goods & vehicles free
Page 152 and 153: and for VAT purposes the two compon
Page 154 and 155: (i.e the lottery organizer) on whic
Page 156 and 157: The VAT charged on above should be
Page 158 and 159: 1.2.3 Other imported materials exce
Page 160 and 161: The sub-contract awarder should pay
Page 162 and 163: 2.3.1 Imported goods (except fabric
Page 164 and 165: 5.2.2 To BOI garment manufacturing
Page 166 and 167: Annexure - 2 First Schedule to the
Page 168 and 169: 4. Supply of any services to any Di
Page 170 and 171: Services 1. Electricity more than 3
Page 172 and 173: Sale before 01.08.2002 - GST Regime
Page 174 and 175: GST = (CIF + CD + Surcharge + Ex.Sp
Page 176 and 177: to indicate the date of payment of
Page 178 and 179: The period within which the Board o
Page 180 and 181: Mrs. S.N.P. Abrew - Senior Assessor
Page 182: 182
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