Anyone have a clue about this? I have a receipt for drinks - some coffees, some soft drinks. Bill is broken down into food and beverage even though all are 'beverages'! Do I include VAT on the food element and not on the beverages?
I also have another receipt that breaks down stuff into wet and dry! VAT on the dry but not the wet?
I've looked on HMRC but am still confused!
Own company or employee of one?
own company
Flat rate scheme? Might be worth it unless turnover is too high?
Just claim on the lot - it's not a large enough amount that the VAT man will even query it.
Flat rate is a nightmare - especially if you are on a cash accounting with clients.
Own company?
We're on the FRS ourselves, while the rate isn't as good as it was it saves worrying/calculating anything to do with VAT. Plus if anything goes on the accounts 'wrong', you ain't defrauding the VATMan 🙂
Flat rate is a nightmare
Flat rate is a dream come true for all the contractors on here, they collect more VAT than they pay. Like getting a commission from the VAT man 🙂
1. Personally I'd get an accountant if you've got your own company and VAT is a mystery 😉
2. Yes, Flat Rate Scheme is what you want to get on if you're a small enough business, *if* you want to be VAT registered (or if your turnover is over £81k and then you have to).
FRS is much easier as you don't have to claim VAT back on each purchase, plus you might be able profit a little depending on how much you sell and spend (due to difference in the VAT rate you pay vs the VAT you charge on sales).
In terms of claiming expenses, I assume you've paid personally and want to claim back from your company. In which case you as an individual just claim the full amount, VAT and all, from your company. If the company is VAT registered then the company can also claim the VAT back from HMRC, but not if it's on the FRS. If not VAT registered then the company can't claim anything, but then you don't charge VAT on your sales and have to do a VAT return either.
Disclaimer: IANAA (I Am Not An Accountant) 😀
Also, I'm looking at it from a Ltd company point of view. If you're a sole trader I'm not so sure.
Thanks all, its more an issue of the individual elements within a bill that I had a query about rather than the need to go to the flat rate. Some receipts break them down, some don't.
In simple terms, if it is overnight you can claim, if not you can't.
I usually bung the whole lot in irrespective of whether I am staying overnight or not.
[i]Thanks all, its more an issue of the individual elements within a bill that I had a query about rather than the need to go to the flat rate. Some receipts break them down, some don't. [/i]
The beauty of FRS is that you don't care, just look at the gross.
If you are consultant/ contractor and don't buy much you want frs. Did my quarterly return in about 10 mins today. All receipts just go in a box to be ignored.