Persons engaged in taxable, exempt and non-business activities
Certain costs may relate to taxable, exempt and non-business activities. If this arises you need to apportion the costs to determine what Value-Added Tax (VAT) you can reclaim. You can only reclaim that proportion of the VAT which has been used for your taxable activities.
The proportion calculated needs to correctly reflect:
- the extent to which the costs are used for your taxable supplies
- must have due regard to the range of your total supplies.
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