GST-registered businesses may claim input tax before paying their suppliers. However, if a supplier is not paid within 12 months from the payment due date, the input tax claimed must be repaid to the Comptroller of GST.
Partial Payment
Only the input tax on the unpaid portion must be repaid, calculated as: Unpaid GST-inclusive amount × 9/109.
Example: On a S$140 invoice with S$50 paid, the S$90 balance remains unpaid after 12 months. Input tax to repay: S$90 × 9/109 = S$7.43.
Paying Later
If you pay the supplier after the 12-month deadline, you may reclaim the repaid input tax, provided payment is made within 5 years from the end of the accounting period in which it was first claimed.
Key Actions
- Review your accounts payable ageing regularly
- Track input tax repaid so it can be reclaimed on time
- Report repayments and reclaims in the correct GST periods
Contact us for assistance with GST compliance.