Global

Details

  • Service: Tax, Global Indirect Tax
  • Type: Regulatory update
  • Date: 11/1/2012

Fiji: VAT Essentials 

Essential information regarding VAT as it applies in Fiji.


Scope and rates

What supplies are liable to VAT?


Value Added Tax (VAT) is payable on taxable supplies. A company makes a taxable supply if carrying on a taxable activity and registered for VAT accordingly.


What is the standard rate of VAT?


The standard rate of VAT is 15 percent.


Are there any reduced rates, zero rates, or exemptions?


Zero rated supplies include:


  • export of goods
  • export of certain services where the use and benefit of such services is outside Fiji
  • international transportation services
  • international inbound telecommunication services
  • certain basic food items
  • electricity to residential consumers.

Exempt supplies include:


  • financial services
  • residential rent
  • education services provided by an educational institution
  • goods and services donated to a non-profit body.

What are the other local indirect taxes beside VAT?


Other indirect taxes include:


  • customs duty
  • stamp duty
  • gambling turnover tax
  • service turnover tax.

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Registration

Who is required to register for Fijian VAT?


Every person who carries on a taxable activity supplying goods or services with annual turnover exceeding 100,000 Fijian dollars (FJD) within 21 days.


Are there penalties for not registering or late registration?


Failure to apply for registration is an offence. Where convicted of such an offence the taxpayer is liable to a fine not exceeding 50 percent of the tax payable where the delay in registration is less than 6 months, or a fine not exceeding the amount of tax payable where the delay in registration is more than 6 months.


Is voluntary VAT registration possible for an overseas company?


No.


Are there any simplifications that could avoid the need for an overseas company to register for VAT?


Not applicable.


Does an overseas company need to appoint a fiscal representative?


No.

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VAT grouping

Is VAT grouping possible? 


No.


Can an overseas company be included in a VAT group?


Not applicable.

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Returns

How frequently are VAT returns submitted? 


Generally monthly.


Entities with an annual turnover of less than FJD300,000 may file VAT returns on a quarterly basis or annual basis on application to the Commissioner.


Are there any other returns that need to be submitted?


An input schedule in the prescribed form is required to be submitted with the VAT return.


If a business receives a purchase invoice in foreign currency, which exchange rate should be used for VAT reporting purposes?


The spot rate on the date of the invoice.

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VAT recovery

Can a business recover VAT if it is not registered?


No.


Does your country apply reciprocity rules for reclaims submitted by non-established businesses?


Not applicable.


Are there any items that businesses cannot recover VAT on?


Not applicable. 

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International supplies of goods and services

How are exports of goods and services treated?


Exports are zero rated.


How are goods dealt with on importation?


Import VAT is payable on importation.


How are services which are brought in from abroad treated for VAT purposes?


Reverse charge VAT is payable.

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Invoices

Is a business required to issue tax invoices?


All VAT registered businesses must issue VAT invoices for all supplies where the value exceeds FJD10.


The recipient of supplies with a value below FJD10 may request a VAT invoice if one is not provided and the supplier is obligated to provide one.


What do businesses have to show on a tax invoice? 


The following particulars are required:


  • the words “tax invoice”
  • name, address and Tax Identification Number of the supplier
  • name and address of recipient
  • serialized number and date of issue of the tax invoice
  • description of goods or services supplied
  • quantity or volume of goods or services supplied
  • the price excluding VAT, the VAT amount, and price including VAT.

Where the supply is made by a retailer and the consideration does not exceed FJD100, the following particulars are required:


  • the words “tax invoice”
  • name, address and Tax Identification Number of the supplier
  • date of issue of the tax invoice
  • description of goods or services supplied
  • statement that the price is VAT inclusive.

Can businesses issue invoices electronically?


There is no current provision within the Fijian VAT law to permit this. However it is possible to negotiate with the Commissioner of Inland revenue to use electronic invoices on a case by case basis.


Is it possible to operate self-billing?


Yes where approved by the Commissioner.


Can a business issue VAT invoices denominated in a foreign currency?


The legislation is silent on this. However where the tax invoice is denominated in a foreign currency, the same must be declared to the Commissioner in FJD at the spot rate of exchange on the transaction date (generally invoice date).

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Transfers of business

Is there a relief from VAT for the sale of a business as a going concern?


The sale of a business as a going concern to a registered person is zero rated.

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Options to tax

Are there any options to tax transactions?


Not applicable.

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Head office and branch transactions

How are transactions between head office and branch treated?


Transactions are treated in the normal manner, that is, treated at arm’s length.

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Bad debt

Are businesses able to claim relief for bad debts?


Yes.

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Anti-avoidance

Is there a general anti-avoidance provision under VAT law?


Yes.

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Penalty regime

What is the penalty and interest regime like?


Penalty for late filing at 20 percent of the amount of tax outstanding and additional 5 percent of the amount of tax payable for each month of default.


Penalty for late payment penalty at 25 percent of the amount of unpaid tax and additional 5 percent of unpaid tax for each moth of default.


Penalty for failure to maintain proper records penalty at 20 percent of the amount of tax payable, or 75 percent where the failure is knowingly or recklessly made.


Penalty for making false or misleading statement at 20 percent of the amount of tax payable, or 75 percent where the failure is knowingly or recklessly made.


Offences, where convicted, are liable to fines or imprisonment.


The legislation provides for interest on late refunds to be payable by the Commissioner, but this is generally not applied in practice.

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Tax authorities

Tax audits


How often do tax audits take place?


There are no set timelines for tax audits.


Are there audits done electronically in your country (e-audit)? If so, what system is in use?


No.


Advance rulings and decisions from the tax authority


Is it possible to apply for formal or informal advance rulings from the (indirect) tax authority?


The legislation provides for the possibility to seek formal rulings, however in practice this has not been implemented by the tax authority.


Are rulings and decisions issued by the tax authorities publicly available in your country?


No. However, there are Practice Statements issued by the tax authority and published on their website: www.frca.org.fj

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Miscellaneous

In your country, are there unique specific indirect tax rules (regimes) that differ from standard indirect tax rules in other jurisdictions?


No.


Are there indirect tax incentives available in your country (e.g. reduced rates, tax holidays)?


Reduced duty rates for importations are available for certain approved projects/industries.

 

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