VAT Flashcards
When is the tax point of a transaction?
The earlier of the:
- Despatch
- Invoice
- Payment
If the invoice is issued within 14 days of despatch, then the invoice is the tax point.
What can you NOT claim input VAT on?
- UK client entertaining
- cars
- non-business items
- items for which no VAT receipt is held
Under what conditions is a trader required to register for VAT via the historic method?
If taxable supplies in the last 12 months exceeded £82,000
When dates should you register for VAT via the historic method and when will it be applicable?
- within 30 days of taxable supplies exceeding £82,000
- the first day of the second month following, e.g. if in September supplies exceed the threshold, VAT will apply from 1 November
Under what conditions is a trader required to register for VAT via the future method?
If taxable supplies in the next 30 days will exceed £82,000
When dates should you register for VAT via the future method and when will it be applicable?
- notify by the end of the 30 day period
- immediately applicable
When is it compulsory to deregister for VAT?
when a company ceases to trade
Can you voluntarily deregister for VAT?
why of course, if taxable supplies over the next 12 months will be less than £80,000
When gifting goods, what value do you charge the VAT on?
The amount it would cost to replace the goods
In a partnership, is it the partnership as a whole or the individuals?
VAT is charged on taxable INDIVIDUALS
How do you calculate VAT return?
Output VAT - Input VAT
If somebody runs 2 businesses and is also a member of a partnership, how many VAT registrations will they need?
2 for the businesses, the partnership registers collectively even though the individuals are taxed
Is providing a service taxable?
No
Do you need to pay output VAT on stock held at deregistration?
Yes, if the output VAT exceeds £1000
At what point can a company claim back output VAT relating to a client that has gone into liquidation?
when the debt is 6 months old and written off in the accounts?
When is the basic tax point on goods on sale or return?
Adoption date, unless invoice is issued under 14 days from adoption, in which case it is the invoice
Is the supply of capital assets, e.g. machinery, taxable?
naaaaaa
Does a company making over £82,000 worth of zero-rated supplies have to become VAT registered?
Yes they still need to register and can apply for an exemption
Can input VAT be recovered on goods purchased before registration?
Yes, input VAT can be recovered on goods supplied within 4 years before registration, so long as the business still owns the goods and they are for business use.
Can input VAT be recovered on services provided before registration?
Yes, input VAT can be recovered on services supplied 6 months prior to registration as long as they were for business
If an individual’s year end is 30 June, and their return is required in 2 months of their year end, is the return due on 30 or 31 August?
31 August
