VAT Flashcards
VAT historic registration: When to notify and when registered for period end 31 Mar?
Period end 31 Mar, notify 30 Apr, registered 1 May
VAT future registration: When to notify and when registered?
Notify end of 30d period, registered from beginning of 30d period
VAT pre-registration recovery
Goods on hand: 4y
Services: 6m
VAT deregistration: Stops making taxable supplies: When notified & when deregistered?
Notify 30d, deregistered when stopped making the taxable supplies
Voluntary VAT deregistration: When notified and when deregistered?
When expected supplies under OBT 83 for next 12m (can’t be temporary drop)
Deregistered on date of request (can be any time because voluntary)
What do you have to do when deregistered for VAT?
There is a deemed supply of business assets over 1k
Unless sale/incorporating business
VAT irrecoverable debt
Can claim VAT back if 6m old
Is business entertainment expense VAT recoverable?
NO
Unless 100% business
Or Staff
Or foreign customers
Are cars VAT reocverable?
NO
Unless 100% business
Is (proprietor) private use recoverable?
NO
VAT refund time limit
4y
Can an employee or sole trader recover VAT on fuel bought for private use?
YES
BUT output OBT SCALE CHARGE!
Can you recover VAT on the repairs of cars with negligible business use?
YES
As long as any business use
VAT return electronic payment deadline
1m7d
Is VAT in MTD
Yes
Unless voluntary registration under threshold
What’s it called when HMRC come to check your VAT?
Control visit
Is there any help you can get if you make a lot of VAT recoverable purchases?
Monthly returns
What is the higher limit for VAT and what do you have to do if you hit it?
2.3m
(Liab, any 12m)
Monthly submission
When is a VAT invoice due?
30d from tax point
What is the penalty called when you don’t submit VAT or the return on time?
Default surcharge (OBT)
How long is the VAT default surcharge period?
12m
Error in VAT return: Under deminimis
Deminimis = 1% turnover 10-50k
OBT penalty but no interest
Can submit on next return
Error in VAT return: Over deminimis
Deminimis = 1% turnover 10-50k
OBT Penalty and interest
Have do disclose on separate form
Error in VAT return: Found in control visit
OBT Penalty and interest
(Not disclosed because HMRC have already found out :D)
When is annual accounting scheme VAT due?
2m after end of year
What is annual accounting VAT shcheme?
One annual RETURN
But TEN payments
VAT annual accounting scheme payments
TEN payments
First 9 monthly at the end of the year (10% prev year VAT)
Balancing payment at VAT return
(Can choose to pay quarterly if too many payments aha)
What do you have to do as a flat-rate VAT business when selling to another VAT registered business?
Still need to send a VAT invoice
Group VAT registration requirement
Common control (3p)
UK resident
VAT on output to oveseas
Zero rated (no VAT!)
VAT on input from overseas
No VAT paid
But put as input & output on return
VAT: Goods vs Services
Goods:
1. Hire purchases
2. Power/ heat/ cooling/ ventilation/ water
3. Bus asset gifts (not samples/ under £50)
Services:
1. Hiring goods
2. (Free) use of bus assets for non bus use
3. Restaurants
How to deal with partially exempt traders?
**Do simple tests 1&2*
Failed?
a. Calculate input tax relating to exempt supplies (proportion non-attributable)
b. apply test 1 to the input tax relating to exempt supplies
Who can be part of a VAT group? (need 50% control)
Companies
Pships
Sole traders
VAT on property: Sale of bare land
EXEMPT
VAT on property: Sale of a residential building
EXEMPT
VAT on property: Sale of an OLD commercial building (+3y)
EXEMPT
VAT on property: Lease of building
EXEMPT
VAT on property: Sale of constructed residential building
ZERO RATED
VAT on property: Sale of converted bulding
ZERO RATED
VAT on property: construction of commercial building
STANDARD RATED
VAT on property: Sale of NEW commercial building (3y)
STANDARD RATED
Chargability of VAT on property rules
- Old? Exempt
- Commercial? Standard
- Constructed or converted? Zero
Otherwise exempt (resid, land, lease)
What can you option to tax and what does it mean?
(OLD) COMMERCIAL BUILDINGS
a. recover input
b. charge output on lease (rent & premium) and sale within 20y
Difference with VAT for imports deadline?
Can account for in next VAT return (not when duty paid to release goods)
VAT: Services to non-business overseas customers?
Charge VAT
What to not forget about the VAT car fuel scale rate?
It’s MONTHLY
Two things to remember about the VAT flat rate scheme?
- 1% deduction that year if joined in first year or registration
- Limited Cost Businesses (OBT)
When to use VAT reverse charge system?
Receiving services from business abroad
