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Input tax

VAT is tax properly chargeable, paid or payable on¹:

1. Ìý

   •ÌýÌýÌýÌý goods and services supplied² or deemed to be supplied to a person³

2. Ìý

   •ÌýÌýÌýÌý goods acquired by a person from another EU member state⁴, and

3. Ìý

   •ÌýÌýÌýÌý goods imported by a person from a place outside the member states⁵

The word 'chargeable' is implied in VATA 1994, s 24(1). If tax is charged in error, it cannot be VAT and therefore cannot be input tax⁶ (or, for that matter, output tax⁷). Conversely, tax which is chargeable may be input tax even where the supplier is not VAT registered⁸. A claim for such input tax will, however, be at the discretion of HMRC; SI 1995/2518, reg 29(2)⁹. The failure to exercise such discretion may invalidate any related assessment, although such an assessment may be reinstated (subject to the normal rules) once the discretion has been exercised¹⁰, subject to the normal rules.

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