At present VAT and NBT are payable by the SME Sector if the turnover exceeds Rs. 650,000 per quarter or Rs. 2,500,000 per annum.
In accordance with the Budget proposals announced on 8 November2012 this limit has been increased to Rs. 12 million per annum. However, VAT and NBT files could not be closed for a minimum period of one year and should continue beyond 31 December 2013 if necessary. Nil return has to be submitted every quarter.
In the case of VAT, there could be outstanding input balance available as at 31 December 2012. This may include balance as at 31 December 2010, which had been allowed to be deducted at 10% per month against VAT output liability with effect from 1 January 2011. This information would be available when VAT return for the quarter ending 31 December 2012 is submitted. Since there is no output liability after 1 January 2003 for people who have annual turnover less than 12 million. I appealed to the Department of Inland Revenue to consider refunding the VAT input outstanding as at 31 December 2012 or permit setting off against income tax liability if any commencing year of assessment 2012/2013 (15 February 2013 is the next date).
I appeal to the Ministry of Finance and Planning to consider my proposal favourably.