Computing for input VAT

The expanded value added tax increased the vat rate from 10% to 12%. When computing for your input VAT, the net amount is now divided by 1.12, instead of 1.10.

The formula for getting the gross amount is derived below:

Thus, if the net amount paid is P33.60:

P30.00 is to be recorded as Expense, and the remaining amount (P3.60) is to be recorded as Input Vat.

The formula for computing the input VAT is derived below:

If the net amount is P33.60:

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