ITAX Flashcards
If a VAT registered business makes a supply to another VAT registered business how long must they send an invoice from date of supply?
30 days
If saved electronically what is the most secure format to save the invoice in?
What is the advantages of having electronic invoices?
- Instant transfer or invoice to customer
- Rapid access and retrieval
- Reduced storage costs
- improved cashflow
- more secure
- easier to access in the case of disputes
What should be included on a invoice?
Invoice number Name, address and VAT number of supplier Date of supply and date of issue Purchasers name and address Description of goods or services
What is some examples of basic tax point?
When a supplier sends good to a customer When customer collects goods When supplier makes them available for the customer to use The date when service is performed Date the all work is completed
When is basic tax point over rules by actual tax point?
Advance payments (including deposits and payment of pro forma) and invoices 14 day rule
Can you reclaim VAT on employee entertainment or business entertainment?
Employee expenses unless you are entertaining overseas customers
Can u claim VAT on vehicles?
No unless it is exclusive for business use, taxi, driving school, self drive hire, car dealers - inventory
Can u claim VAT on repair and maintains of a vehicle?
Yes
What is the fuel scale charge?
Payable on each vehicles and the amount is based on CO2 emission of it therefore the higher the CO2 the higher the fuel scale charge. Thus the fuel scale charge increases the amount payable to HMRC.
What boxes should fuel scale charge be in on the VAT return?
VAT exclusive figuree in box 6 and VAT element in box 1
When can the output tax for bad debt relief be written off?
The debt is more that 6 months and less that 4 years and 6 months overdue
VAT has been paid to HMRC
Debt has been written off in accounts
Where is bad debt relief shown in the VAT account?
Increase in input tax not a deduction from output tax. If the business satisfies all the criteria for claiming bad debt relief amount of VAT being claimed should be added to box 4
When is the earliest tax point for goods despatched by a UK supplier to another EU state?
The date on the invoice covering the goods
15th of month following the month of supply
When a UK buyer received goods from another EU state the same applies
When is VAT due if delivering to a storage facility like a free zone or warehouse?
Until goods are released from storage to UK buyer
What is included in box 4 of the VAT return?
Input vat including acquisitions + bad debt relief
When should VAT returns be recieved by HMRC?
Online returns - one month and seven days after VAT period
Returns are made quarterly - except annual accounting scheme or if elect to have monthly returns
When should VAT payment be recieved by HMRC?
If pay online - one month and seven days after VAT period
If pay by direct debit - one month and ten days after VAT period
How much is the misdeclaration penalty?
15% charge on unpaid VAT
What is tax avoidance?
Avoiding paying unnecessary tax
Legal use of tax regime to own advantage
What is tax evasion?
Deliberately misrepresenting or concealing info
Illegal
What box does underpayments get added into on the VAT return?
Box 1
What box does overpayments get added into on the VAT return?
Box 4
Why do we keep accounts?
Internal Control
measuring buiness performance
obtaining credit/financing
statutory requirements
What is capital?
The amount of money invested in the business by the owner(s)
What is a non current asset?
items purchased by a business for use on a semi-permanent basis
What is carriage in?
cost of carriage paid on purchases
What is carriage out?
cost of carriage paid on sales
