Accounting for Value Added Tax (VAT) - Philippines
The value-added tax or VAT is a tax on the consumption levied on the sale, barter, exchange or lease of goods or properties and services in the Philippines, as well as on the importation of goods into the Philippines. VAT covers transactions which are made in the course of trade or business, and is not limited to regular activities but can include incidental transactions or transactions deemed sale under the National Internal Revenue Code.
To learn how to post the net VAT to a liability account, see Posting the Net VAT to the VAT Liability Account.