my clients have an annual retainer with a public company for say £100k this is billed with VAT , part of their responsibilities is to arrange events supplying food and drink events the attendees are members of the press and other influencers, my client receives and pays the bill say £50k and we reclaim VAT on this. The question is this correct or should VAT not be reclaimed?
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Your client pays £50k for supplies of catering. He re-charges it, along with other supplies, for £100k. These are supplies in the course of his business, and input tax is deductible on the purchase; output tax is accounted for on the sale.
If you are concerned about the business entertainment rule, then that does not arise, since the hospitality is being paid for.