Think I'm over analysing this one.
Client runs a hotel and occasionally provides rooms and dining to family and friends free of charge. HMRC's VAT toolkit states "When goods on which a business has claimed input tax in full (such as an item of stock) are subsequently put to private or non-business use, there is generally a deemed supply for VAT purposes and output tax is normally due on the cost of the supply. The deemed supply is one of goods if the change of use is permanent and of services if temporary."
How would you normally calculate the deemed charge - direct costs plus an apportionment of overheads?
Replies (4)
Please login or register to join the discussion.
I’d say food at cost but that’s about it. if you want to be precise/[***]/waste time then calculate a charge for elec & laundry.