VAT on a cross charge invoice
We are a VAT registered business, we have received an invoice from a supplier who is not VAT registered for work done on behalf of our customer, we are then going to charge to our customer, as we have not been charged VAT by the supplier do we need to charge VAT to the customer?
The cost to the customer will be the same, we are not adding a margin
Disbursement
Just to add to above comment, the rules for being able to treat an expense as a disburesement are restrictive. Doubt they apply in this case but, just in case, and for future ref:
http://www.hmrc.gov.uk/vat/managing/charging/disbursements.htm
Dear anon #2
Didn't mean to cast doubt over your comment so apologies if it came across like that. I was, as I said, just adding to it. You rightly brought up the subject of disbursements but gave no further information over where anon #1 might seek info, so just "plugging your gap" so to speak.
You're right I am only guessing that it won't apply. Back to you Anon #1.
VAT to be charged
The supply from your sub-contractor to you is one supply. The supply from you to your customer is another supply.
If you are VAT registered then your supply to your customer will be subject to VAT (assuming it is a taxable supply of services, building, goods, etc).
So if you receivee an invoice from sub-contractor for £100, you would have to recharge this to your customer as £100 + £17.50 VAT, even though you were not charged VAT.