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Posted December 3, 2019

Zero-rated vs Exempt


Zero-rated vs Exempt

Not Knowing how to distinguish difference between : 

ZERO RATED SALES EXEMPT SALES
No output tax No output tax
Subject to 0% Exempt from VAT
VAT on purchases is claimed as input tax VAT on purchases is claimed as expense
Taxpayer should be VAT-registered Taxpayer should be non-vat registered



Reference : Sec 4.106.5 ; 4.108.5 and 4.109-1 RR 16-05