VAT

News by Category

Easing cashflow with monthly VAT returns

31st May 2022
Is it possible to move to monthly VAT returns to get the cash in quicker? VAT Technician Elaine Wight explains. If most of your sales are zero-rated, then it’s likely that you usually get a VAT repayment every quarter. But having to wait for that VAT refund after the end of a quarter can cause...

Introducing HMRC’s new VAT penalties

26th April 2022
The first step towards alignment of VAT and direct tax penalties was due to take place in just two months but the government recently announced a delay. What’s the full story? Audrey Rankine takes a closer look. HMRC’s original timetable for the harmonisation of its late filing penalty and late payment interest regimes across most...
Termination fees and compensation payments

New rules on termination fees and compensation payments

13th April 2022
Your business has mobile phone contracts and hires vehicles for employee business trips. How do you check that you are not being overcharged VAT following HMRC’s change of rules on termination fees and compensation payments? VAT expert John Craig takes a closer look. New legislation for early termination fees and compensation payments took effect on...
New policy on termination payments

New policy on termination payments

7th March 2022
HMRC is changing its policy on termination payments. As a result, some businesses will be entitled to a VAT refund while others will owe more. What’s the full story? VAT expert John Craig takes a closer look. In September 2020, HMRC changed its policy on one-off payments made in connection with a contract, e.g. early...
March Q&A

March Q&A

1st March 2022
Can a director take a company vehicle out of the business to sell? Q. A company director bought a car through his business on finance, it has been a company vehicle for a few years. The finance is now paid off, and he would like to sell it, but as the business is VAT registered,...

February Q&A

1st February 2022
Is VAT payable on cash stolen by employee? Q. We are retailers and have discovered that a member of staff has been understating our sales by taking, say, £30 cash from a customer, and only recording the sale as £25 in the till. Must we account for VAT on the £5 shortfall? Does it make...

Reclaiming VAT on Sponsorship

15th January 2022
Your son’s rugby club has approached you regarding sponsorship support to pay for his team’s kit. A member of the club says that if you put the cost through your business then you’ll get a tax deduction and can reclaim the VAT. Are they correct? John Craig explains the position. The tax position for sponsorship...

November Q&A

26th November 2021
What VAT rate do we apply to a hamper? Q. We trade as a food and drinks wholesaler. With Christmas approaching, we will be selling a hamper that includes a range of food and drink items, including tins of luxury fruit, jams, cakes, wine and chocolates. Our plan is to sell each hamper for £49.99...

Charging VAT on a mixed-use property?

19th November 2021
You are in the process of leasing a property to a tenant who will use the ground floor for her retail business and the upper floor as living accommodation. Could opting to tax the property save you VAT? Supplies of property, e.g., letting, are normally exempt from VAT but opting to tax the property changes...

Unregistered suppliers and VAT

8th September 2021
You need some building work done at your office, but your preferred supplier is not registered for VAT. This means that it will not be able to reclaim input tax on materials, increasing the final bill to your business. Is there a solution? Bob Johnstone takes a closer look. Frozen VAT threshold Even though the...