Article 29 – Accounting for Tax on the Margin
1. The Taxable Person may calculate Tax on any supply of Goods by reference to the profit margin in the following situations:
a. Where he made a supply of Goods mentioned in Clause 2 of this Article which were purchased from either:
1) A Person who is not a Registrant.
2) A Taxable Person who calculated the Tax on the supply by reference to the profit margin.
b. Where he made a supply of Goods for which Input Tax was not recovered in accordance with Article 53 of this Decision.
2. The Goods to which Clause 1 of this Article refers are Goods which have been subject to Tax before the supply which shall be subject to the profit margin scheme and those Goods are:
a. Second-hand Goods, meaning tangible moveable property that is suitable for further use as it is or after repair.
b. Antiques, meaning goods that are over 50 years old.
c. Collectors’ items, meaning stamps, coins and currency and other pieces of scientific, historical or archaeological interest.
3. A Taxable Person may not elect to calculate Tax by reference to the profit margin in respect of Goods referred to in paragraph (a) of Clause 1 of this Article if a Tax Invoice or other document is issued for that supply mentioning an amount of Tax chargeable on the supply.
4. The profit margin is the difference between the purchase price of the Goods and the selling price of the Goods, and the profit margin shall be deemed to be inclusive of Tax.
5. The Taxable Person must keep the following records in respect of supplies made in accordance with this Article:
a. A stock book or a similar record showing details of each Good purchased and sold under the profit margin scheme.
b. Purchase invoices showing details of the Goods purchased under the profit margin scheme. Where the Goods are purchased from Persons who are not Registrants, the Taxable Person must issue an invoice showing details of the Goods himself, including at least the following information:
a) The name, address and Tax Registration Number of the Taxable Person.
b) The name and address of the Person selling the Good.
c) The date of the purchase.
d) Details of the Goods purchased.
e) The Consideration payable in respect of the Goods.
f) Signature of the Person selling the Good or authorized signatory.
6. Where a Taxable Person has charged Tax in respect of a supply with reference to the profit margin, the Taxable Person shall issue a Tax Invoice that clearly states that the Tax was charged with reference to the profit margin, in addition to all other information required to be stated in a Tax Invoice except the amount of Tax.