The 2012 worldwide VAT, GST and sales tax guide

I SLE OF MAN 325
Imported goods. The time of supply for imported goods is the
date of importation or the date on which the goods leave a duty
suspension regime.
Goods sent on approval or for sale or return. The tax point for
goods sent on approval or for sale or return is the earlier of when
the goods are accepted by the customer or 12 months after their
removal from the supplier. However, if a VAT invoice is issued
before these dates, the invoice creates an actual tax point, up to
the amount invoiced.
Continuous supplies of services. If services are supplied continuously,
a tax point is created each time a payment is made or a VAT
invoice is issued, whichever occurs earlier.
Reverse-charge services. Effective from 1 January 2010, the tax
point for reverse-charge services is when the service is performed.
For single services, this is when the service is completed
or when payment for the service is made, whichever is earlier. For
a continuous supply of services, the tax point is the end of each
periodic billing or payment period or when payment is made,
whichever is earlier. For continuous supplies that are not subject
to billing or payment periods, the tax point is 31 December each
year unless a payment creates an earlier tax point.
F. Recovery of VAT by taxable persons
A taxable person may recover input tax, which is VAT charged on
goods and services supplied to it for business purposes. Input tax
is generally recovered by being deducted from output tax, which
is VAT charged on supplies made.
Input tax includes VAT charged on goods and services supplied
in the Isle of Man or the United Kingdom, VAT paid on imports
of goods into the Isle of Man or the United Kingdom, and selfassessed
VAT on intra-Community acquisitions of goods and
reverse-charge services (see the chapter on the EU, page 208).
A valid tax invoice or customs document must generally accompany
a claim for input tax.
Special rules apply to the recovery of input tax on expenditure
incurred before registration and after deregistration.
Nondeductible input tax. Input tax may not be recovered on purchases
of goods and services that are not used for business
purposes (for example, goods acquired for private use). In addition,
input tax may not be recovered for some items of business
expenditure.
The following tables provide examples of items of expenditure
for which input tax is not deductible and examples of items for
which input tax is deductible if the expenditure is related to a
taxable business use (these lists are not exhaustive).
Examples of items for which input tax is nondeductible
Purchase of a car (unless the car is available exclusively for business
use)
Fifty percent of VAT incurred on the rental or lease of a car used
for mixed business and private purposes
Private expenditure