The election to waive exemption, also known as the option to tax, refers to the choice by a taxpayer to charge VAT on supplies that are otherwise exempt. This mechanism allows businesses to reclaim input VAT, which can benefit their cash flow and overall financial performance.
Input tax is the Value Added Tax (VAT) paid by a taxable person when purchasing goods or services from a VAT-registered trader. It is used to offset the output tax to determine the final VAT payable to tax authorities.
Irrecoverable Input VAT refers to the Value-Added Tax (VAT) paid on items acquired to produce exempt supplies and cannot be reclaimed or offset against output tax.
Partial exemption in VAT refers to limitations imposed by tax legislation on the input tax a taxable person can claim when they make a mix of taxable and exempt supplies.
A company within a group of companies responsible for accounting for both output and input tax for value-added tax (VAT) purposes, and ensuring the quarterly VAT return for the group is submitted. All companies in the group share joint and several liability for any VAT due.
Understanding the concept of self supply in the context of Value Added Tax (VAT) when dealing with commercial buildings used for exempt purposes.
VAT is a consumption tax levied on the sale of goods and services in the UK, added at each stage of production and distribution.
