Output VAT on cash stolen??

Output VAT on cash stolen??

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Cash takings received by pub and held on premises. Cash then stolen. Is VAT payable on this money? May seem a strange Q but I can envisage Customs saying that the tax point has arisen when the customers paid the cash so VAT is payable and it isnt a bad debt!
Martin Dore

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David Winch
By David Winch
02nd May 2006 11:49

I would have thought so

Martin

I am not a VAT specialist, but I cannot see why VAT should not be payable on the takings which were stolen (i.e. the theft will not cause any change to the VAT which would have been due had there been no theft).

If you have no information which would help the authorities to identify the thief or to trace the stolen funds then you will not be required to report the theft to SOCA (formerly NCIS).

However if the identity of the thief is known or you have information which may be relevant (even if that information is already known to the police) you must report in the usual way.

If you are an MLRO you can get confidential one-to-one email support, information and NewsAlerts from my website www.mlrosupport.co.uk.

David
[email protected]

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By AnonymousUser
03rd May 2006 13:18

Cash stolen
I agree that VAT is payable on this.

Whats the position where cash is stolen by an employee by for example short ringing amounts into the till & pocketing the difference. The amount stolen will not show up anywhere as the till roll will show the smaller amount. But the customer has paid the full amount.
Most small pubs don't have EPS systems and although their stock control systems may show up shortages it would be difficult to differentiate between cash shortages and spillages/ullages etc.

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By John Savage
02nd May 2006 11:49

I very much fear...
that you are right. I came across this very stance during my time as a VATman many years ago, and don't think that C&E's policy has altered (perhaps someone may know otherwise).

The argument was that a tax point has been created at the time of the sale, and VAT is due on those monies. This is different to the case of a 'bad debt' in that the monies would not actually have been paid.

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By AnonymousUser
05th May 2006 17:22

VAT is payable
Unfortunately, VAT is still due. This is because VAT does not apply to the money per se. VAT is chargeable on the supplies that have been made for which the money has been received.

Nick

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