Input Tax Deduction Eligibility
Statutory Basis: VAT Act §22
What statute says
Value Added Tax Act, 2014 (as amended by the VAT (Amendment) (No. 2) Act, 2021), s. 22 governs zero-rated export documentation; eligibility for input-tax deduction on those exports depends on the supporting evidence requirements set out there. Input VAT is deductible only where legal conditions are met, including valid VAT documentation and business use connected to taxable supplies. Where expenditure relates to exempt activity, deduction may be blocked or restricted (see Partial Exemption and Apportionment for the apportionment rule).
The legal focus is entitlement, not convenience: claiming input VAT requires documentary support and a defensible link between the expense and eligible taxable activity.
What platform does
CoralLedger Comply tracks purchase transactions, stores VAT category choices, and surfaces calculations in return workflows. The return preview and apportionment outputs help teams review how input claims were derived for each period.
When data is incomplete, Comply flags compliance and data quality issues so users can resolve missing references before filing.
Customer responsibility
Your team must confirm that each input claim is supported by proper documentation and qualifies under VAT rules. You must also ensure blocked or non-deductible costs are not claimed.
For mixed-use expenses, customer teams must classify direct vs shared costs correctly so Comply can apply the right treatment in the return output.