On reading the HMRC brief I would like to know whether I can just charge the full amount of vat, whilst the customer still receives the settlement discount but only on the goods value?
Goods 100.00
Vat 20.00
Invoice total 120.00 with an offer to receive 3% discount if paid within 14 days.
If customer paid within 14 days their payment would be 117.00. (100.00 - 3.00(PPD)) + Vat 20.00
Am I legally able to to do this?
Thanks,
Neil
Replies (3)
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No
The whole point of the PPD 2015 is that VAT is accounted for on the amount that was actually paid.
So the discount of 3% would actually be £3.60 on the whole value, with goods value being £97 and VAT being £19.40.
See here https://www.gov.uk/government/uploads/system/uploads/attachment_data/fil...