There are a number of VAT Schemes which are designed to simplify accounting for the tax. They may save a business money, reduce complexity, avoid the need for certain documentation and reduce the time needed to deal with VAT. Some schemes may be used in combination with others, although I recommend that checks should be... Continue reading »| Marcus Ward Consultancy Ltd
The subject of invoices is often misunderstood and can create serious issues if mistakes are made. VAT is a transaction tax, so primary evidence of the transaction is of utmost importance. Also, a claim for input tax is usually not valid unless it is supported by an original valid invoice HMRC can, and often do,... Continue reading »| Marcus Ward Consultancy Ltd
What can be used to make a claim? It is well known that in order to claim input tax on expenditure a business is required to have a valid tax invoice to support it. But what if there is no VAT invoice? Can HMRC accept any other evidence to support a claim? Well, the answer... Continue reading »| Marcus Ward Consultancy Ltd
The rules for sending, receiving and storing VAT invoices in an electronic format. What is an eInvoicing? eInvoicing is the transmission and storage of invoices in an electronic format without duplicate paper documents. The format may be a structured format such as XML or an unstructured format such as PDF. The benefits of eInvoicing eInvoicing... Continue reading »| Marcus Ward Consultancy Ltd
Latest from the courts In the First-Tier Tribunal (FTT) case of Go City Ltd the issue was the VAT treatment of passes (“sightseeing packages”) sold by the appellant. Should they be outside the scope of VAT as multi-purpose vouchers (MPVs) or whether “functioning as a ticket”? The difference being the time of supply (tax point).... Continue reading »| Marcus Ward Consultancy Ltd
Business promotions are an area of VAT which continues to prove complex. This is further exacerbated by changes to the legislation at EU and domestic level and ongoing case law. The main points are; whether there is a supply, and, if so, what is the value of that supply? I hope that the VAT position... Continue reading »| Marcus Ward Consultancy Ltd
Although one of the “VAT basics”, it is sometimes quite difficult to establish the date for a tax point, and there is a great deal of case law which suggests that this seemingly straightforward exercise can throw up difficulties. The time at which a supply of goods or services is deemed to take place is... Continue reading »| Marcus Ward Consultancy Ltd
HMRC has publish its latest report and accounts. Headlines £843.4 billion total tax revenues collected which is a 3.6% increase on 2022 to 2023 VAT – gross revenue was £277.7 billion, less: revenue repayable of £112.2 billion – net revenue was £165.5 billion £41.8 billion tax “protected” by tackling avoidance, evasion and error – including... Continue reading »| Marcus Ward Consultancy Ltd
VAT Basics The majority of input tax incurred by most VAT registered businesses may be recovered. However, there is some input tax that may not be. I thought it would be helpful if I pulled together all of these categories in one place: Blocked VAT claims – an overview No supporting evidence In most cases... Continue reading »| Marcus Ward Consultancy Ltd
VAT carousel fraud, also known as missing trader fraud or missing trader intra-community (MTIC) fraud, is a complex and highly sophisticated process used by organised criminals which involves defrauding governments of money that should be paid in VAT. It involves a series of transactions where goods are repeatedly bought and sold across borders, with the... Continue reading »| Marcus Ward Consultancy Ltd
Although, ideally, a business puts aside the VAT it collects from its customers (output tax charged) to pay its monthly, quarterly, or annual VAT bill, cashflow management can be difficult, especially for small or seasonal businesses with limited cash reserves. There are some things a business can do to mitigate the impact of VAT and... Continue reading »| Marcus Ward Consultancy Ltd
Latest from the courts In the Lycamobile UK Ltd First-Tier Tribunal (FTT) case, the issue was whether VAT was chargeable on the supply of a “Plan Bundle” at the time when it was sold and by reference to the whole of the consideration that was paid for it, or whether VAT was instead chargeable only... Continue reading »| Marcus Ward Consultancy Ltd
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TC05078 Blue Chip Hotels Ltd This is a FTT case which considered the VAT analysis of a supply in two ways. The appellant was an hotel which offered a wedding “package”. The package comprised; a room which was licensed for civil wedding ceremonies, the hire of other rooms, catering, accommodation, car parking and the use... Continue reading »| Marcus Ward Consultancy Ltd
The case of: General Healthcare Group Limited (GHG) Those that have read my articles in the past will recognise the topic of composite or separate supplies rears its ugly head on many occasions. It is a matter that has occupied businesses, advisers and HMRC since VAT’s inception, and shows no signs of disappearing any time... Continue reading »| Marcus Ward Consultancy Ltd
As many will know, there is a significant amount of case law concerning what may be treated as a composite supply at one VAT rate, and what are separate supplies at different VAT rates. The latest in this series is the First Tier Tribunal case of Stocks Fly Fishery The appellant is a trout fishery... Continue reading »| Marcus Ward Consultancy Ltd
This seemingly straightforward area can throw up lots of VAT issues and touches on a number of complex areas. If we look at inter-company charges (commonly called “management charges”) it is clear that such a charge can cover a lot of different circumstances. Do I charge VAT on a management charge? An easy yes or... Continue reading »| Marcus Ward Consultancy Ltd
Latest from the courts In this First-Tier Tribunal (FTT) case the issue was whether serviced apartments qualify for exemption. Background Realreed owns a property called Chelsea Cloisters in Sloane Avenue, London. The property comprises; 656 self-contained apartments and some commercial units. 421 of these apartments are let on long leases (no VAT issues arise from... Continue reading »| Marcus Ward Consultancy Ltd
VAT Tax Point Planning If a business cannot avoid paying VAT to the HMRC, the next best thing is to defer payment as long as legitimately possible. There are a number of ways this may be done, dependent upon a business’ circumstances, but the following general points are worth considering for any VAT registered entity.... Continue reading »| Marcus Ward Consultancy Ltd
The CGS If a business acquires or creates a capital asset it may be required to adjust the amount of VAT it reclaims. This mechanism is called the CGS and it requires a business to spread the initial input tax claimed over a number of years. If a business’ taxable use of the asset increases... Continue reading »| Marcus Ward Consultancy Ltd
Opting To Tax commercial property Opting to tax provides a unique situation in the VAT world. It is the only example of where a supplier can choose to add VAT to a supply….. or not. What is an option to tax? The sale or letting of a property is, in most cases, exempt (VAT free)... Continue reading »| Marcus Ward Consultancy Ltd
If you build your own home, there is a scheme available which permits you to recover certain VAT incurred on the construction. This puts a person who constructs their own home on equal footing with commercial housebuilders. There is no need to be VAT registered in order to make the claim. As always with VAT,... Continue reading »| Marcus Ward Consultancy Ltd
Help! Supplies relating to property may be, or have been; 20%, 17.5%, 15.%, 10% 5%, zero-rated, exempt, or outside the scope of VAT – all impacting, in different ways, upon the VAT position of a supplier and customer. In addition, the law permits certain exempt supplies to be changed to 20% without the agreement of... Continue reading »| Marcus Ward Consultancy Ltd
In my experience, there is a general assumption that all “education’ is exempt. It is true to say that a lot of education and tuition is indeed exempt, but that is not automatically the case. It is important to establish the reason for the application of non-taxable treatment. The VAT treatment depends on; what is... Continue reading »| Marcus Ward Consultancy Ltd
Latest from the courts In the First-Tier tribunal case of Queenscourt Limited the issue was whether dip pots supplied as part of a takeaway meal deal are a separate zero-rated supply (of cold food) or whether they are part of a single VATable supply of hot food. Background The appellant had originally accounted for output... Continue reading »| Marcus Ward Consultancy Ltd