Do you include gross sales & gross expenses in your P&L account if you're using the the VAT Flat Rate Scheme?
Thank you so much.
Replies (5)
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Gross expense and net sales.
The output (sales) VAT is a balance sheet item (liability) and is therefore not shown in P&L.
Any profit/surplus made from being on the flat rate scheme can be shown as additional/other/miscellaneous income in P&L.
Gross sales specifically not permitted by FRS 102/105.
If we're talking about an unincorporated body (why do querists think this isn't an important bit of information?), the position is less clear but I'd take the FRSs as replacing UK GAAP and follow those.
Why is it less clear what the correct treatment of output tax is if the entity is not a company? Surely the same principles apply regardless.
Personally, I agree with you.
However, on the basis of what I see from time to time, others do not.