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Any repayment due must first be set off against any other tax arrears. Where a vendor can satisfy the LRA that excess credits are a feature of his business activities, the quarterly rule may be waived and the vendor allowed to make monthly refund claims, or whenever a credit arises.

Objections and appeal

A person who is dissatisfied with an assessment may file an objection with the Commissioner within 30 days after the notice of assessment. After considering the objection, the Commissioner may allow the objection in whole or part, or disallow the objection. The Commissioner must serve the person objecting with notice of the objection decision. If the Commissioner has not made an objection decision within 60 days, the Commissioner is deemed to have made a decision to disallow the objection.

A person dissatisfied with an objection decision may, within 30 days, appeal to the Tribunal. A party to a proceeding before the Tribunal who is dissatisfied with the decision of the Tribunal may, within 30 days, appeal to the High Court. A party to a proceeding before the High Court may, with special leave of the Court of Appeal, appeal the decision of the High Court to the Court of Appeal.

VAT records

VAT invoices

A registered vendor must issue a VAT invoice in respect of a taxable supply to a taxable vendor in the same month that the goods or services are supplied. A VAT invoice must contain the following details:

  • the words ‘value added tax invoice’ or ‘VAT invoice’;

  • the vendor’s commercial name, address, place of business and VAT registration number;

  • individual invoice number;

  • the commercial name, postal address, place of business and VAT registration number of a vendor recipient;

  • date of issuing the VAT invoice;

  • brief description (including quantity or volume) of the goods or services supplied; and

  • the selling price, excluding VAT and any discount, the total amount of the VAT charged, and the selling price including VAT; or

  • the total charge on the invoice inclusive of VAT, any discount and the rate of VAT.

Credit notes and debit notes

Credit notes may be issued where the VAT disclosed on an issued VAT invoice exceeds the correct amount chargeable. The credit note must contain the following information:

  • the words ‘credit note’ in a prominent place;

  • the vendor’s commercial name, place of business, VAT and TIN registration number;

  • the commercial name, place of business, VAT and TIN registration number of the recipient;

  • the date the credit note is issued;

  • brief explanation of the circumstances that gave rise to the issue of the credit note;

  • sufficient information to identify the taxable supply to which the credit note relates; and

  • the taxable value of the supply shown on the VAT invoice, the correct taxable value, the difference between the two amounts and the VAT relating to the difference (that is, the VAT overcharged).

Other than the fact that the words ‘debit note’ must appear in a prominent place, the information to be disclosed

in a debit note is similar to the information required in a credit note. The additional VAT amount in a debit note is due for payment in the period in which the additional liability arises.

Additional export documentation

The required proof of exportation includes:

  • commercial invoices;

  • certified copies of the documents presented to Lesotho Customs at exportation;

  • certified copies of customs import documents of the country of destination; and

  • proof of payment (settlement) if applicable.

Record keeping

A vendor must keep record of all the supplies made and supplies received, including zero-rated supplies, and a summary of VAT for each month. The VAT summary is referred to as the vendor’s VAT account. A separate record must be maintained for any exempt supplies made by a vendor.

If a vendor sells directly to the public he does not need to issue a VAT invoice unless the customer asks for one, but must make a summary of his sales, showing separate totals for:

  • VAT on the sales;

  • value of the sales before VAT;

  • total of all exempt sales;

  • VAT on certain postal imports and

imported services; and

  • credits allowed to customers.

A vendor must keep a summary of supplier invoices received, showing separate totals for:

  • VAT paid on purchases in Lesotho;

  • value of the purchases before VAT;

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