Unrecoverable VAT - VAT return treatment.
All these years and I've never given a real thought to this until now...
On VAT standard-rated purchase invoices on which the VAT is not recoverable or disallowed, eg entertaining expenses, what is the correct treatment for the net and VAT items? Presumably the net, because it is standard-rated, will be included in box 7 on the VAT 100, but what about the unrecoverable or disallowed VAT? Where should that be shown, if anywhere? It isn't outside the scope of VAT because it is VAT itself. It is based on a standard-rated item but HMRC clearly states that items entered in box 7 should not include any VAT.
If you add it to the net and show it in box 7, that is not a true figure. For years my staff have treated it as standard-rated and included it in with the net amount in box 7. Agreed, it needs adding to the net cost for accounting purposes, but how about for VAT return purposes?
HMRC website appears silent on the matter. Anyone any ideas or thoughts? Or is there a definitive answer?
- company secretarial software 114 2
- Value pricing 172 7
- Tax repayment for 2013-14 75 3
- Elective DeductionsModel 50 1
- Papilio UK Equity Release Mortgages Ltd 182 1
- Rental Income 286 6
- Payroll 2012/13 92 1
- I have a pain 670 6
- Sale of assets - availability of AIA to the purchaser 69 1
- convert directors loan account to share capital 156 5
- Anyone else seen incorrect tax code notices - rather worring! 720 17
- Belated VAT Exception Application 108 3
- Cash flow 137 2
- New use of home - simplified method 214 4
- CGT and PPR and Lettings Relief? 259 5
- 2 year rule? Self employed. 372 13
- How long is filing an FPS meant to take ? 1,943 32
- Share restructure 327 12
- Liquidation of Subsiduary 146 4
- Unknown cash receipt 1,847 14
- Residential Property Purchase Above £750K 726
- Using Sage with Sofa Categories 497
- Does anyone have an unwanted ICAEW wooden plaque? 342
- One man Company and closing payroll scheme as none paid 336
- Goods shipped inter EU and VAT Reporting 262
- VAT on Gaming Machines 210
- Sage 200 and Access Dimensions reviews 196
- Non-Resident Director - UK Tax Position? 180
- transferring simply accounting 2010 from xp to windows 7 172
- Director Loan account operation 146