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VAT on private use adjustments

Are debits to director's loan account consideration?

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Quick query

If instead of going down the P11D route for accounting for private use of company employees, my client debits a % of the cost to the director's loan account, should this be viewed as consideration for a supply and VAT applied accordingly?

Cheers

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By johngroganjga
12th Nov 2019 08:30

Presumably you mean a debit to the DLA.

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By the_drookit_dug
12th Nov 2019 08:44

Yes - amended

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By lionofludesch
12th Nov 2019 09:38

Private use of company employees ?

Tell us more.

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By the_drookit_dug
12th Nov 2019 09:50

Administrative staff providing assistance with directors' personal admin beyond what may be considered incidental or insignificant.

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By lionofludesch
12th Nov 2019 09:56

Phew! At least it seems legal.....

Well, it begins to sound taxable at standard rate.

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By the_drookit_dug
12th Nov 2019 10:00

Hahaha.

I wonder though whether going down the P11D route also involves a deemed supply.

Been reading this thread with interest: https://www.accountingweb.co.uk/any-answers/vat-on-benefit-in-kind

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By lionofludesch
12th Nov 2019 10:12

Yes it does.

No difference at all.

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By JDBENJAMIN
12th Nov 2019 10:10

It depends what is being supplied. You need to give more detail.

Update; I see you have done so now. If there is a charge for use of employees' time, then that should be subject to VAT. By charging the DLA, a consideration is being received by the company, so there should be VAT on that. So, yes.

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