Exempt Supplies

    Goods or services not subject to VAT.

    Definition

    Exempt supplies are transactions that are not subject to VAT. Common examples include healthcare, education, financial services, and insurance. Businesses making only exempt supplies cannot register for VAT and cannot reclaim input VAT on their purchases.

    Related Terms

    VAT (Value Added Tax)
    A consumption tax levied at each stage of the supply chain.
    Zero-Rated Supplies
    Taxable supplies charged at 0% VAT.
    Input VAT
    VAT paid on purchases used for business activities.

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