You must show the VAT claimed as a separate total in your These notes are for guidance only.

nly. They reflect the Law and the

purchase records. Department’s position at the time of publication. They do not
replace the Legislation or affect your Rights of Appeal about
The basic T- account transaction is as follows: your tax position.

Transaction (VAT Rate is 15%)

If in doubt, consult the Inland Revenue Department, VAT Accounting
for VAT
1. Section.
Business buys goods to sell for cash VAT Each leaflet covers just one topic. Other leaflets you may find
Inclusive - $3,000 + 450 VAT useful include:
2. What is VAT?
Business sells goods for cash - $6,000 + $900 Should I be registered for VAT?
VAT How to register for VAT?
3. After Registration
Business sells foods on credit - $5,000 + 750 VAT Basic Supply Rules
4.
Mixed Supply Rules
Business imports foods to sell on credit
Accounting for VAT
- $30,000 + $4,500 VAT
Reporting the VAT
Penalties and Offences under the VAT Act
VAT Legislative Overview
VAT and the Consumer
Filing VAT Returns
VAT Documents
Input Tax Deductions
VAT & Entertainment
Transitional Provisions

You can get further help and copies of forms and information
leaflets from the Inland Revenue Department in Castries, Vieux
Fort and Soufriere or The VAT Section, Manoel Street, Castries.

List of typical “business records” include:

• Annual accounts, including profit and loss accounts
• Bank statements and deposit slips
• Cashbooks and other account books
• Purchase invoices and copy sales invoices For further information contact us at:
• VAT Credit or debit notes
• Orders and delivery notes Tel: (758) 468 1420
• Purchase and sales books Email: vatcoordinator@vat.gov.lc
• Records of daily takings such as till rolls vatinfo@vat.gov.lc
• Import and export documents
Website: www.vat.gov.lc
• Business correspondence
• Your VAT account © Ministry of Finance
Inland Revenue Department
April 2012
 Standard -rate Other rate Zero-rate Exempt

Total

If you are a VAT registered business, you must keep records worksheet is used to record the summary of the daily sales, the For Total
each tax period, you must add up the VAT that you
of all the supplies you make and receive, and a summary of amount of VAT you have charged and the amount of VAT you can deduct as input VAT and transfer the total to your VAT
VAT charged and paid/payable for each tax period covered have been charged. A summary of the VAT transactions is then Account.
by your tax returns. transferred to the VAT Account. Sample 2 -Input Tax Worksheet
The VAT Account is a summary of output and input VAT for INVOICE/Custom INVOICE/ SUPPLIER'S TAXABLE
This summary is called the “VAT Account”. each tax period (monthly). DATE Entry TIN# SUPPLIER VALUE VAT TOTAL
INVOICE/Custom INVOICE/ SUPPLIER'S TAXABLE
The information in your VAT worksheet/ account will help you DATE Entry TIN# SUPPLIER VALUE VAT TOTAL
This leaflet tells you about these records, and how best to to complete your tax return at the end of each tax period.
keep them. Remember that there are penalties for failing to
keep proper VAT records a requirement of the VAT Act. Sample 1 - Output Tax worksheet Total

Date Invoice # Supplies / Sales Output tax Total

What records must I keep?

These
Total applicable totals should be transferred to the Tax account/ worksheet or return
Standard -rate Other rate Zero-rate Exempt

You must keep: VAT Account

Input Tax $ Output Tax $

Domestic purchases Supply of goods/services

Input Tax $ Output Tax $
A record of taxable goods and services you Imports Debit note issued

receive(purchase) or supply (sales) as part of your Total

Domestic
Debit note purchases
received Supply
Credit noteofreceived
goods/services

business—this includes supplies at the standard rate Imports

Credit note issued Debit
Bad debtnote issued
recovered

(15%), the lower rate (8%), and at the zero-rate; and Totals from this worksheet should be transferred to the VAT account / worksheet or return.
Debit note received
Bad debt Credittaken
Goods note for
received
non-business

A separate record of any exempt supplies that you Credit note issued
Adjustments for errors etc
Bad debt recovered
Adjustments for errors etc
make or receive.
How do I record my purchases?
Bad debt Goods taken for non-business
You do not have to keep these records in any set way. But, Total Input taxfor
Adjustments allowable
errors etc Total output tax for errors etc
Adjustments
they must be complete and up-to-date, and the figures INVOICE/Custom INVOICE/ SUPPLIER'S TAXABLE Less Input tax allowable

that you use to complete your VAT return must be easy to Your
DATE suppliers’ tax invoices
Entry TIN# will SUPPLIER
show you all theVAT
VALUE details you
TOTAL Tax payable/creditable
Total Input tax allowable Total output tax
find. Usually, your normal business records can be adapted need. Make a summary of the invoices in the same order as
Less Input tax allowable
to give this information. If you find this difficult, ask for you keep or file them. You can make a list of the invoices as
Tax payable/creditable
help from Inland Revenue Department, VAT you receive them, or you may be able to adapt your
Section. cashbook to serve as a summary of purchases.
Total

You may find it useful to number the invoices and record the
How do I record my sales (supplies)? same numbers against the entries in your summary.
What about credit and debit notes?
Input Tax $ Output Tax $
You may make a summary of your tax invoices, and must Your summary must show separate totals at each rate of VAT
Domestic purchases Supply of goods/services
keep copies of them. Your summary should be in the same for: These must show similar details as for a tax invoice, except
Imports Debit note issued
order as your invoices, and show separate totals at each that instead of “tax invoice” they must show either “tax
rate of VAT for: • VATDebit
onnoteimports
received (if any) Credit note received
credit note” or “tax debit note” and the value of the supply
• VAT on your sales(supplies) (Cash/ Credit) • VATCredit
that noteyou
issued have been charged
Bad debt on business purchases
recovered
shown on the original tax invoice, the corrected value, the
• Value of your sales excluding VAT collected • Cost
Badof
debtyour purchases excluding VAT for paid
Goods taken non-business
difference, and the tax charges which relate to that
• Any exempt sales Adjustments for errors etc Adjustments for errors etc difference. In addition, they must contain a brief
You must also keep a separate record of any business
explanation of the circumstances giving rise to the issuing
If you provide any goods or services at no charge, or take purchases on which you cannot deduct input tax:- these are
Total Input tax allowable Total output tax of the note and sufficient information to identify the
any goods from your stock for private use, you must also called “non-deductible inputs” Less
forInput
example:
tax allowable original supply—such as the original tax invoice number.
record: Tax payable/creditable
• What the goods or services were • Passenger vehicles, spare parts, and repair and
• The date you took the goods from stock maintenance service (except if the vehicle is used How do I record my imports?
• The rate and amount of VAT chargeable exclusively for business purposes or you trade in vehicle
• The value of the goods or services excluding the VAT sales)
chargeable • Entertainment VAT is normally payable at the time you import goods or
• Fees and subscription for social and recreational clubs remove them from a warehouse. If you are VAT registered,
At the end of each period, you must add up the VAT shown to claim the VAT you paid on imported goods, you must
in all these records and transfer it to your VAT Account as have official evidence of the amounts involved—such as a
output tax. For most operations, it is advisable that a daily copy of the entry or other customs document.