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With respect to sales tax which of the following statements is correct?
A. Sales tax is charged on purchases and sales after trade discounts and
before settlement discounts.
B. Exempt and zero rated supplies have the same tax effect.
C. Sales tax is not reclaimable on capital expenditure.
D. Sales tax is charged on purchases and sales after trade discounts and
after settlement discounts
Given correct answer is D..But how about alternative C? Sales tax relating to capital expenditure has to be irrecoverable i think..thanks in advance 🙂You think wrong 🙂
All sales tax is recoverable if the company is registered for sales tax – it makes no difference what the nature of the expenditure is.
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