10% VAT Refund on Electric Payment in Nepal
"From today onwards, you can get a 10 % VAT refund on bills through an electronic medium in Nepal"
From February 11, 2020 onwards, you can get a 10 % VAT refund on bills through an electronic medium in Nepal
VAT Refund in Nepal! What?! How did it start?
Consumers will still be able to get a 10% Value Added Tax (VAT) refunded on daily consumption. The government of Nepal has started providing the VAT refund facility as an incentive to consumers who pay through electronic means. It was launched by Finance Minister Yuvraj Khatiwada on 11th February 2020.
In what circumstances do we get a VAT refund in Nepal?
According to this arrangement, consumers who pay up to Rs One Thousand to One Lakh Rupees through the purchase of goods and services will get a refund of 10 percent of the VAT amount in their bank account. The Department of Internal Revenue has issued 'Procedure for a refund of Value Added Tax to Consumers paying through electronic means' to refund VAT.
What are the online mediums to pay?
As starting from this January, consumers will be able to avail of payment through mobile wallets, such as mobile banking, card, connect, IPS, e-service, Khalti, IME (Pay).
Such a facility will be available not only for commercial purposes but also for purchase for personal consumption. The process of VAT return has been made only in the business of Rs. 1,000 to Rs. 1 lakh.
How is the VAT Refund possible in Nepal?
For VAT Refund in Nepal, in the form of a tax invoice, the seller will have to create an electric invoice and issue the electricity invoice, making it clear that ten percent of the value-added tax (VAT) will be paid after the consumer pays through electronic means.
Consumer payments are credited directly to the seller's bank account. 10% of the tax paid will be automatically refunded to the consumer's bank account from the seller's bank account. It will be arranged by the payment service provider.
The seller will have to reconcile the tax refunds with the tax details. The details of such transactions are arranged by the Department to be automatically received in the integrated tax system of the department. The consumer who pays the seller at his place of business will have to make the information public that the value-added tax return is convenient.
For this system to implement, you can use the online medium to pay the bills for the consumer products, internet services, DTH, and also ask your local sellers to provide you with the electronic bill.
Also read: NEW E-PAYMENT APP, CELLPAY IN TOWN