Apportionment Steps
Step 1: Direct Attribution
Allocate input tax directly to taxable supplies (fully recoverable), exempt supplies (not recoverable), or residual (mixed — needs apportionment).
Step 2: Standard Method
Residual input tax × (taxable supplies ÷ total supplies) = recoverable amount. Round to nearest whole per cent. Apply each tax period.
Step 3: Annual Adjustment
At year-end, recalculate using actual annual figures. Compare with provisional claims. Pay back over-recovery or claim under-recovery. File adjustment in first return of new year.
💡 Special Methods
If the standard method doesn't produce a fair result, you can apply to NBR for a special method. Common special methods include: transaction count, floor area, headcount, or sector-based methods. Banks and insurers almost always need special methods.