If a client is on standard accounting then the vat is deducted from the sales and the relevant expenses and vat is not shown at all on the profit and loss account. With fixed rate vat, I have always shown it as an expense on the profit and loss account, how does anyone else show it. I do not feel it is right to deduct from sales as it is a special scheme, it would reduce the sales value but the expenses would include vat. The treatment has been queried by a bank manager/financial advisor.
12th Nov 2011 15:51