The Poinciana: National Flower of St. Kitts Nevis

Tax Tips

Special Input tax rule for supplies at 10%

A taxpayer whose taxable activities include the provision of accommodation and restaurant services, subject to the reduced VAT rate of 10%, is not allowed to deduct in any given tax period, any input tax that exceeds its output tax both of which resulted from this reduced rate taxable activity.

Eg. A taxpayer who operates a guest house or a restaurant and calculates output tax for a particular tax period of $50,000 and allowable input tax for that period of $55,000, is not allowed to deduct $55,000. He/she must only deduct up to $50,000 although he incurred $55,000 in that period.

NB: This taxpayer must never carry forward a credit to the subsequent tax period.