Finance Act 2016

Meaning of “non-deductible tax”

6 (1) In this Schedule “non-deductible tax”, in relation to a taxable person, means—

(a) input tax for which the person is not entitled to credit under section 25 of VATA 1994, and

(b) any VAT incurred by the person which is not input tax and in respect of which the person is not entitled to a refund from the Commissioners by virtue of any provision of VATA 1994.

(2) For the purposes of sub-paragraph (1)(b), the VAT “incurred” by a taxable person is—

(a) VAT on the supply to the person of any goods or services,

(b) VAT on the acquisition by the person from another member State of any goods, and

(c) VAT paid or payable by the person on the importation of any goods from a place outside the member States.