According to the VAT Act, vat credit can be claimed within 12 months of purchases if the output is exclusively VAT attractive. The person shall obtain a Tax invoice prescribed by the regulation (not an Abbreviated Tax Invoice) for claiming the input VAT credit on purchases made.

As per the general understanding, a registered person can only claim an input VAT credit for the goods purchased in a tax invoice prescribed. But as per Rule 43(1), a person can apply for the input VAT credit of any stock or capital items lying at the stock at the time of registration. It can be applied to the respective tax officer in form of Annex 16 of VAT Regulation, 2053 for claiming such input VAT credits. Further, the input VAT credit can be substantiated through the valid VAT documents if asked by the tax officer. Moreover, the tax officer can inspect the stocks lying at the time of registration physically as well.

The application (annex-16) and the valid documents shall be presented to the tax officer within 15 days of registration. The VAT paid on purchases through valid VAT invoice to such dates that is not more than one year before can be allowed as input tax credit by the tax officer. Hence, the stock in this form is deemed to be purchased after registration.