MOT tests - can someone help with VAT treatment?
Strange how so many posts start with 'a new client'. As so often happens, this one has been done no favours by his previous, erm 'bookkeeper'. I'm having to backtrack over a number of years to find when he should have registered for VAT, but the MOT test question is making it more difficult.
He is not an approved MOT centre, so has tests done elsewhere. He charges more than he pays the approved centre, so he is not an agent under VTTAXPER3900, so I don't see how he can treat the cost to him as a disbursement. However, I am reading VTTAXPER48000 incorrectly, as I find two of the VAT treatments conflict. One paragraph says that any amount charged over and above the amount paid is taxable at the standard rate. Yet the next option says that if he does not treat the exact amount that he is charged as a disbursement he must account for VAT on the full invoiced amount.
So, if he only accounts for VAT on the 'profit' under the 1st option, does that mean he has some exempt sales which lead us in to partial VAT calculations?
Any guidance would be greatly appreciated.