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Sale/ transfer of depreciable

the entire unamortized input tax on the capital goods sold/


good within a period of 5 yrs or
transferred can be claimed as input tax credit during the month/
prior to the exhaustion of the
quarter when sale of transfer was made
amortizable input tax

goods/properties with estimated useful life greater than one yr :


Capital goods/ properties treated as depreciable assets : used directly/ indirectly in the
production/sale of taxable goods/services

cost of construction work which is not yet completed. CIP is not


depreciated until the asset is placed in service. Upon
Construction in Progress
completion, CIP is reclassified and the reclassified asset is
capitalized and depreciated

a. CIP is considered, for claiming input tax purposes, as a


purchase of service, value of which shall be determined
based on progress billings
b. Until such time construction has been completed, it will not
Input tax on CIP qualify as capital good as defined, in which case, input tax
credit on such transaction can be recognized in the month
the payment was made; Provided, OR of payment has been
issued based on the progress billings

only labor will be supplied by the contractor, materials will be


purchased by the contractee from other suppliers, input tax
Contract for the sale of service credit on the labor contracted shall be recognized on the
where only labor will be supplied month the payment was made based on progress billings,
input tax for materials purchased at the time materials were
purchased

Input tax claimed while the if already claimed while still in progress, no additional input tax
construction is in progress can be claimed upon completion

1. No deduction from Gross income for depn shall be allowed


UNLESS the taxpayer substantiates the purchase with
sucient evidence, such as OR

2. only 1 vehicle for land transport is allowed for the use of an


Depreciation on vehicles, other
ocial/employee, value should not exceed 2,400,000.00
expenses incurred and input tax
3. No depn shall be allowed for yachts, helicopters, airplanes/
on disallowed expense
aircrafts, and land vehicles which exceed 2,400,000,
(RR No. 12-2012, Oct..12,2012) UNLESS taxpayers main line f business is transport
operations/ lease of transportation equipment

4. Maintenance expense on account on non-depreciable


vehicles for taxation purposes are disallowed in its entirety

1. Processors of sardines, mackerel and milk

2. Manufacturers of refined sugar and cooking Oil

3. Manufacturers of packed noodle-based instant meals

PRESUMPTIVE INPUT TAX


4% of gross value in money of purchases of primary
agricultural products which are used as inputs to their
production

1. taxpayers who became VAT-registered persons upon


exceeding the minimum turnover of 1,919,500 in any 12-
month period

TRANSITIONAL INPUT TAX


2. taxpayers who voluntarily register even if thei turnover does
not exceed 1919500 (except franchise grantee of radio/
television broadcasting whose threshold is 10,000,000.00

Beginning inventory of goods, materials, and supplies


(excluding VAT exempt)

BASIS OF TRANSITIONAL IT
2% of the value of the beginning inventory on hand or actual
vat paid on such goods, materials and supplies,
WHICHEVER IS HIGHER

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