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?
- New client has not reported director's pay by RTI 360 10
- VAT on employee loan 281 5
- Taking over from an on-line accounting firm. Any ideas? 940 18
- Charging VAT on a company loan ?. 96 2
- Accountants website 366 5
- TaxCalc - A Return to Form 216 2
- What do you all do in your spare time? 675 29
- VAT on long lease in comercial property that has opted to Tax 163 5
- So who has completed a 2015 tax return then? 447 8
- Threshold company limited by guarantee. 87 1
- Retrospective VAT Claim 108 1
- Auto Enrolment - Director Only Answer 1,405 20
- SAGE 50 PAYROLL YEAR END 217 5
- Can software startup claim VAT refund during development? 170 6
- Tax implications on building an 'office' 218 2
- VT Final Accounts puts "Cost of Sales - Carriage" and "Cost of Sales - Other Costs" into "Other Costs". Is that compulsory? It seems mad. 200 3
- Auto Enrolment, Payroll, Small Client Advice and what to charge? 717 18
- Partial PPR relief to non-resident after 05 Apr 2015 151 1
- Purchased Goodwill 161 1
- Accounting Package for Projects 93 2
- New Fangled Penalties 1,082
- Moving away from CCH software 936
- QROP pension input amounts 428
- write off loan or loan to equity swap or both 372
- HMRC BENCHMARK EXPENSES 344
- Unused Losses and Post Cessation Receipts 312
- fraud 270
- EIS relief on transferring shares to spouse 240
- Sole trade business in UK, but the owner works from EU 213
- Construction CIS LLP Company 192