Where a business incurs expenditure which is passed on to a customer, it is important to recognise the difference between a Disbursement and Re-charged Expenditure. A cost incurred on behalf of a customer is classed as a Disbursement and is reclaimed from the client, but does not form part of the main supply of services … Continue reading Disbursement or Re-Charged Expenditure?
The VAT Road Fuel Scale Charges have been amended with effect from 1st May. The new rates can be found here. If a business is VAT registered and purchases road fuel for business use, but there is also private use of a vehicle, then an adjustment needs to be made to ensure that VAT is … Continue reading VAT Road Fuel Scale Charges From 1st May
HMRC has succeeded after a decade-long battle with department store, Littlewoods over compound interest. Between 1973 and 2004, Littlewoods overpaid millions in VAT and, although they were refunded the sum plus simple interest, they took legal action seeking compound interest for the “mistake in law”. The law states that ‘where a taxable person has overpaid … Continue reading HMRC Victorious in VAT Dispute Over Compound Interest
HMRC have backed down in a landmark case that has been ongoing for the past 18 months. The case related to the payment of VAT on advice fees for Birmingham based Barnett Ravenscroft Wealth Management. The case was opened when the firm asked for a £462,528 VAT repayment, relating to fees which it was charging … Continue reading HMRC Back down in VAT on Advice Fees Case
There are a number of ways to account for VAT. While standard VAT accounting is used by many firms, small business owners may wish to consider the alternative schemes that are available. Choosing the most suitable option could save you a considerable amount of time and money. Annual accounting scheme Under the annual accounting scheme, … Continue reading Choosing the Right VAT Scheme for Your Business
To make accounting for private use of fuel simpler, you can choose to apply the VAT fuel scale charge. This scale charge adds back a fixed sum each VAT period to account for the private use of fuel, making redundant any need to split the mileage between business and private use. The scale charge for … Continue reading VAT Fuel Scale Charge
From 1 April 2017 HMRC are changing the rules for using the VAT Flat Rate Scheme (FRS). In an attempt to wipe out what HMRC has seen as abuse of the flat rate scheme, businesses will now need to determine whether they fall into a “limited cost trader” category, by comparing the percentage of goods … Continue reading Concerns for small businesses using the VAT flat rate scheme
Ed Gooderham of Green & Co speaks to the Insider magazine in the latest printed edition on VAT. Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.
Here we are again - can ‘yule’ believe it’s that time of year when businesses like to ‘present’ their staff with a reward for all their hard work? Did you know that certain gifts can be tax efficient? The VAT man won’t entirely ‘reindeer’ on your parade. First off, we have employee gifts. It doesn’t … Continue reading ‘Tis The Season Of Giving – Some Christmas Cheer From The VAT Man
As announced in the Autumn Statement, there are significant changes ahead for companies using the Flat Rate Scheme (FRS) for VAT. The FRS will continue to run, however many businesses will find it is no longer economical to use. Under the FRS, a business ignores VAT incurred on purchases when reporting VAT, with the exception … Continue reading Changes to the VAT Flat Rate Scheme