Preparing for vat implementation

SAINT LUCIA
Preparing for VAT Implementation

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Preparing for VAT Implementation
The introduction of VAT and its implementation within your business could have a wide-
ranging effect. VAT is not simply a tax issue - it is a business issue. It affects some of
your business functions and can impact financials, including cash flow.
The challenge is to identify and address all business issues during the VAT
implementation process and minimize, to the extent possible, any disruption to your
business.
It is critical to be compliant with the VAT Law and Regulations. A structured and
strategic approach ensures an efficient implementation, which takes into account your
specific business issues while ensuring ongoing compliance with VAT legislation
All businesses and service providers that are required to register for VAT should urgently
begin to put the necessary internal systems and procedures in place to account for VAT.
Business persons who have an integral role to play should intensify their pre-
implementation procedures, and begin to put the necessary systems in place to position
their businesses to be VAT-ready.
Guidelines for Businesses
1. Impact
Business owners should identify and analyze the impact of VAT on their businesses,
develop an implementation plan, estimate costs and allocate resources.
2. Adjust business structure
Adjust business processes and structure, adapt/change systems, review arrangements with
suppliers and customers, educate and train staff, suppliers and customers
3. Registration
Businesses are reminded that registration is compulsory for those businesses that have
met or are expected to meet the prescribed threshold -of $180,000. The VAT Act will
give the necessary power to the Comptroller of Inland Revenue Department (IRD) to
retroactively register persons who fail to apply for registration and have them account for
the tax that should have been collected.

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4. Getting Ready
Area
Be informedA. • Get information on how VAT operates;
• What items will be subject to VAT;
• Registration requirements including registration
date; and
• Attend seminars
B Registration
.
•
•
Determine if the goods or service you provide
will attract VAT
•
Determine if your business is making the -
annual gross taxable sales per year of $180,000.
•
If yes to both, you must apply for registration by
the prescribed date;
•
Applications for Registration form are available
at all offices of Inland Revenue Department and
the VAT Office.
Get all your business registration documents
ready; store them somewhere safe and easy to
retrieve. For example: Company registration
document, including documents relating to
directors.
C. Taxable nature of
goods & services
• Businesses must be able to separate goods and
services which are going to be taxed at the
standard rate from those which will be taxed at
zero percent, other lower rate or exempted.
D. • VAT registered taxpayers will need to prepare
well in advance and put appropriate systems in
place for fulfilling their obligations under the
VAT Act. This will be particularly important for
businesses relying heavily on computer-based
systems for accounting and management control
purposes. Computer systems may need to be
adapted and tested in good time to ensure a
smooth change-over on the date VAT comes into
effect.
Accounting system

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Area
• Determine if your present accounting and cash
registers are capable of accounting for VAT. Is it
capable of separating transactions as noted in
“C” above?
E. •Records & Accounts
• Every person who is registered to collect VAT is
required to keep accounts, books and records as
will be prescribed under the law and to produce
the relevant accounts, books and records
whenever and wherever they are required to do
so by the Comptroller;
If you are required to registered for VAT, good
record keeping is of utmost importance;
• The records will be required to be kept in
English, quoted in EC currency and kept for six
years; and
• They must be kept in their original format or as
prescribed or permitted by the Comptroller.
F. • Invoicing has a special significance under a VAT
system. As invoices provide the means for
verifying VAT amounts due/ payable and
amounts claimed as input tax, they are the
essential basis for administering VAT. VAT-
registered taxpayers are required to issue a Tax
Invoice for every taxable supply made to a VAT
registered person;
Invoices
•
•
Know the basic requirements/information that is
needed for a tax invoice or receipt;
•
If you are using a pre-printed invoice book, do
an inventory to ascertain how many you have
and if they can carry you to the date of
implementation. Try to avoid unnecessary cost
by printing books, shortly before
implementation, which are not VAT compliant.
Examine your current invoices/receipts to
ascertain if they carry the basic information.
Note that most invoices carry basic information.

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Area
The main additional information will be the
“Tax Identification Number (TIN)” for both the
supplier and recipient, the word “TAX Invoice”,
and the amount of tax charged to the
customer/client;
• you have a large inventory and the invoices carry
the basic information, you can ask the
Comptroller if it permissible for you to buy a
stamp which can be used to add the TIN and the
“Tax Invoice”. Further information on invoices
can be found in Section 5.
G. •Cash register
•
If you are currently using a cash register,
ascertain whether your existing cash register can
be modified to provide the required information;
•
If yes, identify how long it will take to
reprogram;
•
If it cannot provide the basic information, you
should consider purchasing a new one;
Ideally, the cash register should be able to
account for different taxable transactions,
including exempt sales
H. •Point of sale system
•
If you are using a point of sale system, ascertain
if the existing system can be programmed to
provide the required information for a tax
invoice, sales receipt and different taxable
transactions;
•
Ascertain if it can be programmed by you or if
you need a programmer or the developer to
reprogram it;
Ascertain the length of time it will take to re-
program
I. •Inventory
•
Start analysing your current inventory;
•
Identify those which may be subject to tax, zero-
rated or exempted;
Identify those items that have a quick turnover
rate and on which you may have paid

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Area
consumption tax;
•
•
For the slow moving items which contain
existing taxes to be replaced by VAT, e.g.
consumption tax, you may want to consider
offering some sales discount to reduce your
stock of these items;
•
Avoid making large orders of new stock (goods
that attract consumption tax) prior to the
introduction of the VAT, particularly slow
moving stock. If you are a large importer of
stock, consider using the Customs bonded
warehousing facilities and remove stock from the
bond as needed.
•
The idea is to minimise the double taxation
effect on these items;
If your items are priced for shelf display and it is
possible to reduce the inventory, do so in order
to avoid having too many goods to re-price
J. •Re-pricing
•
If you are a retailer, operating a supermarket or
similar type business, you may want to start
thinking of how best to handle the
implementation with respect to re-pricing. Items
which are tagged and shelf displayed will have to
be re-priced if the price changes with the
introduction of the VAT. This can be time
consuming and will depend on how many items
needed to be tagged. Note the prices are to be
tax-inclusive.
If you offer service, then this may not be as
difficult.
Product identification
& display
K. •
•
You should be knowledgeable of the tax
treatment of the goods/services which you
supply, i.e,, whether they are taxable at the
standard rate, zero-rated, or exempted;
You may have to put systems in place to assist
your customers/clients to identify the different

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Area
categories, i.e. goods/services that are taxable at
the standard rate, zero-rated or exempt. Display
signs, tax codes, colour codes may be used to
identify the respective categories.
Staff sensitisationL. •
•
Your staff should be sensitised, as they should be
able explain the basic aspect of VAT to their
customers/clients;
•
The cashiers should be able to identify the
category of items in the event that your support
system fails. Training of cashier is paramount.
The accounting staff needs to know how to
account for the daily transactions and how to
complete and file the VAT return
M. •Talk to
customers/clients
•
Your customers/clients need to fully understand
the implications of the new tax;
They need to understand how the tax will affect
existing contracts or contracts being negotiated.
N. •Transition provisions
• Where a contract was concluded between two or
more parties before the implementation, and no
provision relating to the new tax was made in the
contract, the supplier may recover from the
recipient the tax due on any taxable supplies
made under the contract after the date of
implementation;
With the implementation of VAT, there will be
some implications for existing contracts, or
contracts being negotiated or existing inventory.
For inventory, see note ”I” above.
• If the contract is concluded after the
implementation and it does not include a
provision relating to the tax, the contract price is
deemed to include tax and the supplier under the
contract is required to account for the tax due;

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Area
O. • VAT may also have implications for cash flow
and costing/pricing arrangements in some
businesses. For example, in a business where
most inputs are purchased on credit terms and
most sales are for cash, there would be cash flow
benefits since the tax collected on sales would in
effect provide a low-cost solution for working
capital needs. Conversely, if purchases are
mainly made for cash and most sales are on
credit, there would be adverse cash flow effects.
These negative or positive cash flow effects
would have cost implications which might, in
turn, require some adjustment of selling prices,
depending on competitive conditions. The prices
charged for goods or services newly subject to
tax under the VAT system may also need to be
reviewed by those concerned with making such
supplies.
Cash flow/ pricing
effect
5. TAX INVOICE
A. Over view
An invoice is a document which notifies a purchaser of an obligation to make a payment.
A tax invoice is one of the most important documents in a VAT system. It contains
additional information which is not normally found on an ordinary invoice. The
additional information is a requirement of the VAT Act.
B. What is a Tax Invoice?
A Tax Invoice is a document issued by a VAT registered person to another VAT
registered person indicating that a taxable supply has been made and that VAT has been
charged on the value of the goods/services being supplied.
C. Who can issue a tax invoice?
A tax invoice can only be issued by a person who is registered to charge and collect
VAT.

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Whenever a VAT registered taxpayer sells goods or services, which are subject to VAT
to another VAT registered taxpayer (purchaser), the supplier, must issue to the purchaser
a tax invoice showing, among other details, the amount of tax charged on what is being
supplied.
D. Why is it important to issue tax invoices?
Tax invoices are used to record sales and purchases between VAT registered taxpayers. A
tax invoice serves four main purposes:
i. it establishes the time of supply when issued;
ii. it serves as evidence of transacting business between two registered taxpayers and
how much VAT is charged;
iii. it serves as a reference for cross-checking, which is one of the main features of
the tax credit method of a value added tax; and
iv. importantly, it is the principal evidence to support the registered purchaser’s claim
for input tax.
A VAT registered taxpayer should ensure that he receives a tax invoice when he makes a
purchase from another registered taxpayer. He will be able to support his claim of the
VAT he paid on purchases for his business, but he must keep the tax invoices he
received. Similarly VAT invoices myust be issued to ensure registered taxpayers claim
their input tax.
E. What information should be included on Tax Invoice?
A tax invoice shall contain the words, “TAX INVOICE” in bold letters at the top or at
any prominent place and shall also contain the following details-
i. the term “Tax Invoice”;
ii. the supplier’s and purchasers Tax Identification number (TIN), name and address;
iii. date of supply;
iv. quantity, description of goods or services, unit price of items;
v. the rate and amount of any cash discount offered;
vi. total consideration, excluding tax;
vii. tax rate
viii. total tax charged; and
ix. total price payable by the recipient.
Therefore, a tax invoice is simply a normal commercial bill or invoice with the following
additional pieces of information:
• the words “Tax Invoice”;
• the VAT registration numbers (TIN) for the supplier and the recipient;
• the rate and amount of tax applicable; and

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the total value of the invoice including tax.
A simpler version of the tax invoice should be used when VAT registered persons sell to
unregistered customers/clients. It is called a “sales receipt”. The sales receipt should
contain the following information.
i. the words “VAT Sales Receipt” in a prominent place;
ii. the name, address and TIN of the supplier;
iii. the date on which the sales receipt is issued;
iv. a description of the goods and services supplied, including the quantity or volume
as applicable and, if necessary to identify the supply, the date on which the supply
was made (time of supply);
v. the total consideration for the supply (including VAT); and
vi. the amount of VAT charged
Remember: A person shall not issue a false tax invoice or sales receipt as it is an
offence resulting in severe penalties.
F.Time of Supply
This is the time when a supply of goods or services is treated as taking place. A supply of
goods or services occurs on the earliest of the date on which —
(a) The goods are delivered or made available or the performance
of services is completed;
(b) An invoice for the supply is issued by the supplier; or
(c) Any consideration for the supply is received.

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Example 1
A Tax Invoice
Sales Invoice No. 175
VAT Registration No. 987 6543 21
From: The Business Approach Ltd
Church Street, Soufriere, St. Lucia
To: The Other Ltd
57 North Road, Vieux Fort, St. Lucia
VAT Reg. No. 9876624 22
Date 16/09/2012
Quantity Description & Price Unit Price
Amount
Excl. of VAT
EC $ VAT Rate %
VAT Net
EC$
6 Radios, (am, fm band) 52.5 315.00 15.00 47.25
4 mp 3 players 102.5 410.00 15.00 61.50
6
nickel base standing
lamps 350 2,100.00 15.00 315.00
Delivery (strictly net) 10.00 15.00 1.50
Net 2,835.00 425.25
VAT 425.25
Total 3,260.25
Terms : Cash discount of 5% if paid within 30 days

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Example 2
TAX INVOICE
Computer Accessories TIN: 23457
T/A Best Computer Services Date:11/08/2012
8 King Street
Vogue Ltd TIN: 77654
89 Young Street
Inv# CA-B345
Qty Description unit price Total
5 computer key board 334.00 1,670.00
3 printer covers 50.00 150.00
5 computer screens 350.00 1,750.00
7 17'' monitors 540.00 3,780.00
1 mouse pads 35.00 35.00
Sub-Total 7,385.00
less 10% discount 738.50
Total 6,646.50
Tax @ 15% 996.98
Total price 7,643.48
sample invoice - indicating treatment of cash discount
prices are tax-exclusive

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Example 3
TAX INVOICE
MILLS Wholesale TIN: 23457
8 High Street
Date: 09/23/2012
G & B Grocery TIN: 2384
89 Young Street
Inv# 0035
Qty Description unit price Total
15 lb rice X 5.00 75.00
10 lb sugar X 7.50 75.00
12 pk milk X 10.00 120.00
12 bread X 3.00 36.00
24 soda T 8.00 192.00
24 malta T 12.00 288.00
36 bath soap T 5.00 180.00
24 lotion T 6.50 156.00
24 shampoo T 15.00 360.00
12 hair oil T 4.50 54.00
48 pens T 2.00 96.00
48 pencils T 1.00 48.00
Sub total 1,680.00
Tax @ 15% 206.10
price - tax exclusive
Code is used to identify type of product:
Z for zero-rated; X (E) for exempt & T- for standard rated

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Example 4
TAX INVOICE
8 High Street Date: 09/23/2012
89 Young Street
Inv# 0035
Qty Description unit price Total Tax
15 lb rice 5.00 75.00
10 lb sugar 7.50 75.00
12 pk milk 10.00 120.00
12 bread 3.00 36.00
24 soda 8.00 192.00 28.80
24 malta 12.00 288.00 43.20
36 bath soap 5.00 180.00 27.00
24 lotion 6.50 156.00 23.40
24 shampoo 15.00 360.00 54.00
12 hair oil 4.50 54.00 8.10
48 pens 2.00 96.00 14.40
48 pencils 1.00 48.00 7.20
Sub -Total 1,680.00 206.10
Tax @ 15% 206.10
This sample invoice shows the tax separately

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Example 5
TAX INVOICE
8 High Street
Date: 12/23/2010
89 Young Street
Inv# 0035
Qty Description Unit price Total
15 lb rice X 5.00 75.00
10 lb sugar X 7.50 75.00
12 pk milk X 10.00 120.00
12 bread X 3.00 36.00
24 soda T 9.20 220.80
24 malta T 13.80 331.20
36 bath soap T 5.75 207.00
24 lotion T 7.48 179.40
24 shampoo T 17.25 414.00
12 hair oil T 5.18 62.10
48 pens T 2.30 110.40
48 pencils T 1.15 55.20
1 transportation of goods T 28.75 28.75
Tax @ 15% 209.85
Taxable amount 1,608.85
Unit prices are tax-inclusive
Code is used to identify type of product:
Z for zero-rated; T- for standard rated; X for exempt
Note: the tax is computed by applying the tax fraction to the total taxable amount
Total price * (r / (1 + r)) = $1,608.85 * (0.15 / 1.15)
NB: your cash register or Point of Sale system can be programmed to computed the tax
and taxable value if the prices are input as tax-inclusive

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6. Recording Key information
i) Recording Sales;
Sales invoices must be recorded in your sales day book. A summary of the
invoices applicable to the period in which you are preparing your VAT return
must be maintained.
Your summary should be in the same order as your invoices and show separate totals for:
• VAT on your sales
• VAT-exclusive values of what you have sold
• Any exempt sales
• Any credits allowed to your customers.
If you give any goods away or take any goods from your stock for private use, you must
record:
• What the goods were
• The date you took them from stock
• The rate and amount of tax chargeable
• Their VAT-exclusive cost.
Each tax period you must add up the VAT shown in these records and transfer it to your
VAT account as output tax.
Remember- If you allow a credit to a customer, any VAT on the credit note will reduce
the amount of VAT you have to pay in the tax period in which you issue the credit note.
ii) Treatment of Export Sales
Where goods are exported, the registered person is required to hold evidence that the
goods have been exported. This will include, for example:
• contracts;
• copies on invoices;
• freight and packing details;
• custom export documents
• evidence of payment for the supply.
If services are supplied to a non-resident who utilise that service outside of St. Lucia, or
are zero-rated because they were supplied under conditions which rendered them so, the

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registered person should keep records to show that the services provided were zero-rated.
These include:
• contracts;
• tax invoices, invoices or sales receipts;
• evidence of payment for the supply.
iii) Bad Debt
It is quite common for businesses to pay output VAT before they have received
payment from their customers. If the amount due from the customer is later classified
as a Bad Debt, a business is allowed to make an adjustment to reclaim the VAT paid
on sales, subsequently deemed bad.
Business making bad debt adjustments must keep records for six years, from the
date of the claim to show;
• The time and nature of supply, customer’s name and consideration- normally
a VAT invoice will show this.
• The amount of VAT and the accounting period it was paid.
• Any payment received from customer to date
• The provision made for the bad debt.
iv) Recording Purchases;
Your supplier’s tax invoice will give you all the details you need. A summary
should be maintained of the invoices in the same order as you keep them. You can
make a list of the invoices as you receive them or you may be able to adapt your
cash book to serve as a summary of purchases if you want to deduct input tax as
you pay your suppliers. You may find it useful to number the invoices and record
the same numbers against the entries in your summary. Your summary must show
separate totals for:
• VAT that you were charged on your purchases
• VAT-exclusive values of your purchases
• VAT on imports (Paid to customs & Excise)
• Any credits received from suppliers
If you receive a credit from a supplier, any VAT on the credit note will reduce the
amount of tax you can deduct in the tax period in which you have received the credit
note.
You must also have a separate record of any business purchases on which you are not
able to claim input tax, for example, cars and business entertainment expenses.

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(You should provide your supplier with your VAT registration number to be included on
any invoice issued to you.)
Each tax period you must add up the VAT that you can deduct as input tax and transfer it
to your VAT account.
Remember that if you are deducting VAT
• You must have a proper tax invoice, and
• The purchase must be made for business purposes.
v) Recording your Imports
VAT is payable at the time you import goods or remove them from warehouse (in
case of a bonded warehouse). To reclaim VAT you pay on imports or goods
removed from the bonded warehouse, you must have official evidence (found on
your customs declaration) of the value of the goods. You must show the VAT on
imports as a separate total in your purchase records.
7. Keeping Records and Accounts
Legal Requirements
Every person who is registered to collect VAT is required to:
a) Keep accounts, books and records as prescribed under the law;
b) Produce relevant accounts, books and records whenever and wherever they are
required to do so by the Comptroller of Inland Revenue;
c) Produce any other information as may be required or as may be prescribed;
d) The accounts, books, records and other information relating to the taxable
business must be kept in and English, E.C. currency and in Saint Lucia for
six years.
What Records should a business maintain?
Records must be kept of all goods and services supplied by or to the registered person
showing sufficient detail to enable the goods and services, and the suppliers or the agents,
to be readily identified by the Inland Revenue Department. All invoices, tax invoices,
sales receipts, credit notes and debit notes relating to those supplies must be kept.

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The records must be kept in a form, and contain information, which will enable the
Comptroller to determine a registered person liabilities and obligations under the Act; or
the amount of any rebate or refund to which the registered person is entitled.
The records must be completely up-to-date and must easily relate to the figures shown on
the tax return for each tax period. A tax period is a calendar month.
Examples of books and records include:
• Certificate of Registration
• Tax invoices;
• Sales receipts;
• Cash register tapes and summary receipts;
• Tax debit and credit notes;
• Purchase invoices/import and export documents;
• Purchases & sales day books;
• Order and Delivery books;
• VAT account;
• Export documents;
• Day book, daily transaction summary;
• Non-taxable Credit and debit notes;
• Charts and code of accounts;
• Accounting instruction manuals;
• stocktaking figures (Inventory)
• list of debtors and creditors;
• list of assets and liabilities;
• Financial statements;
• Computerized records including, system and programme documentation which
describes the accounting systems maintained on a computer, computer tapes,
disks and other similar devices;
• Bank statements, paying in slips or deposit books and cheque book stubs duly
completed; and
• Any other information relating to the taxable business and related businesses.
How long should I retain these records?
A registered person must keep these books and records for at least six (6) years from the
end of the tax period to which they relate. Where the accounts are produce and kept by
means of a computer record, all documents, disks, and tapes are to be stored in a manner
so as to preserve all such information. All changes made and the dates they were made
should be noted in chronological order.

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How am I to treat goods given away, taken for personal use or divert to an exempt
activity?
A registered person must keep a record of goods given away, taken for own use,
transferred to non-taxable activity if these goods have been acquired or produced, for the
purpose of making a taxable supplies. These records must contain the following
information:
• the recipient of the goods;
• date they were taken from stock or utilised;
• the description and quantity of the goods;
• the cost of the supplies and the tax to be paid on it.
Why should a taxpayer keep proper records?
Definition of Records
For the purpose of the VAT Act & Regulations, the term records includes books of
account (whether contained in manual, mechanical or electronic format) which record all
transactions relating to the operation of the business
There are several reasons for a taxpayer to keep proper records:
a) Accurate records will help you to have better control of your business. They help
to determine whether your business is making enough money to meet its
expenses.
b) You'll also have a better idea of how well your business is doing during the year,
rather than finding out when you finally get your books done at the end.
c) Good records increase your chances of getting financing or funding and make it
easier for others to know whether to invest in your business.
d) When it's time to complete your corporate income tax return and VAT returns, all
the information you need, will be readily available. You'll find the more up-to-
date your records are, the quicker you'll get through your tax returns and
paperwork.
e) An Inland Revenue Department audit will be quicker and less disruptive if all the
information is easy to find. Once you are in business it is expected that you will
be audited at some stage.
f) Proper record keeping serves as a history of various transactions conducted by
your operation. It also facilitates the information process and can assist
management in making informed decisions.

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g) Importantly, it is a legal requirement to keep proper books and records. This is a
requirement by the Value Added Tax Act (VAT Act), and possibly other
legislations.
h) It is the best tool to guard against fraud and employee’s theft.
Keeping computerized records
It is common for business records and accounts to be kept on a computer and there
are no special VAT rules about using a computer. The Inland Revenue Department
does not recommend any particular package as suitable for your needs, however, you
must ensure that the system you are using is compliant with VAT regulations and
reflects all the prescribes accounts for VAT, and allows officers to view your records
as and when required.
8. THE VAT ACCOUNT
A VAT account is simply a summary of your output and allowable input tax for each
tax period (monthly). It is a separate record you must keep of the VAT you charge on
your sales (output tax) and the VAT you paid on your purchases (input tax).
It provides the link between your business records and your VAT return.
You need to add up the VAT in your records regularly and enter the totals in your
VAT account with separate headings.
The VAT account has two parts. One part summarizes the totals of output tax for each
prescribed accounting period, including every error or adjustment that is required or
allowed. The other part summarizes the total of input tax for each prescribed
accounting period, again including every error or adjustment that is required or
allowed.
You can keep your VAT account in whatever way suits your business best, as long as
it includes the following information about the VAT that is
• Due on sales
• Due following a correction or error adjustment
• Claimable from your business purchases
• Claimable on acquisitions
• Entitled to following a correction and error adjustment
• Adjustment for Bad Debts

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For most operations, it is advisable that a daily worksheet is used to record the
summary of the daily sales, the amount of VAT you have charged and the amount of
VAT you’ve been charged. A summary of the tax transaction is then transferred to a
VAT account.
Example 6 – Sample - Output VAT worksheet
Date Invoice # Supplies / Sales Output tax Total
Standard -rate Other rate Zero-rate Exempt
Total
The above sales can either be VAT-inclusive or exclusive. However, the VAT
return indicated that the sales should be VAT inclusive.
These totals should be transferred to the VAT account / worksheet or return
Example 7 – Sample -Input VAT worksheet
These applicable totals should be transferred to the VAT account/ worksheet or return
INVOICE/Custom
DATE
INVOICE/
Entry
SUPPLIER'S
TIN# SUPPLIER
TAXABLE
VALUE VAT TOTAL
Total

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You can use the information from your VAT account/worksheet to complete your return
at the end of each accounting period. You subtract your input VAT from your output
VAT, to give you the net amount of VAT you have to pay to or reclaim from the Inland
Revenue Department.
Example 8- VAT Account;
THE BUSINESS APPROACH LIMITED, VAT ACCOUNT, January 1 – 31, 2010
INPUT VAT $ OUTPUT VAT $
VAT on imports 20 000 VAT on sales 50 000
VAT on local purchases 10 000 VAT on goods - personal use 200
VAT on business inputs 1 000 VAT on bad debts recovered 500
VAT on services 3 000 VAT on credit notes received 300
VAT on credit notes given 100
TOTAL INPUT VAT 34 100 TOTAL OUTPUT VAT 51 000
LESS: TOTAL INPUT VAT 34 100
NET VAT PAYABLE 16 900
Remember every VAT registered business must retain a VAT Account.
Penalties
You should be aware that there are penalties for:
a) failure to keep proper records;
b) failure to file returns on time;
c) failure to issue tax invoices

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An Operational Overview of VAT within a Business
Adjustments
Debit note;
Credit note;
Bad debt
recovery;
errors
Supplies – all
sources
Tax Invoices &
Receipts
OUTPUT TAX
WORKSHEET
VAT
ACCOUNT
VAT RETURN
Domestic
taxable supplies
Tax Invoices
INPUT TAX
WORKSHEET
Import
Custom
documents
Adjustments
Debit note;
Credit note;
Bad debt;
Errors

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VAT Implementation Project Office
Bridge Street
Castries
Saint Lucia
Tel: 1 (758) 468-1420
Fax: 1(758) 452-4984
Email: vatcoordinator@vat.gov.lc
vatinfo@vat.gov.lc
Website: www.vat.gov.lc

Preparing for vat implementation

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