Input Tax is the VAT you pay on business expenses. Recovering this against your Output Tax is key to cash flow management.
✓
Recoverable Input Tax
You can reclaim VAT on expenses used for making taxable supplies:
- ✓ Inventory for resale
- ✓ Commercial Rent
- ✓ Office supplies & equipment
- ✓ Professional fees
✕
Blocked Input Tax
VAT cannot be recovered on:
- ✕ Entertainment expenses
- ✕ Personal motor vehicles
- ✕ Employee benefits (non-contractual)
Conditions for Recovery
- You must hold a valid Tax Invoice.
- You must have paid or intend to pay the consideration within 6 months.
- The goods/services must be used for making taxable supplies.