VAT Invoices and Tax Points

Question 1

What 11 points does an invoice need to contain to be a valid supporting document for VAT reasons?

Answer 1

1. Unique invoice number
2. Name and address of the seller
3. Sellers VAT registration number
4. Name and address of the purchaser
5. Invoice date and tax point date (if different)
6. A description of the items being sold
7. The quantity and unit price of each item being sold
8. The rate of VAT applied to each item sold
9. Any trade discounts that may apply
10. Details of any VAT due
11. The total value of the invoice

Question 2

When can a simplified VAT invoice be issued?

Answer 2

When the total amount of the invoice including VAT is less than £250

Question 3

What 5 things does a simplified VAT invoice need to show?

Answer 3

1. The sellers name and address
2. The sellers VAT registration number
3. The time of supply (tax point)
4. A description of the goods and services
5. Total price (including vat)

Question 4

When must a customer keep a copy of a simplified invoice?

Answer 4

If they wish to reclaim the Input VAT

Question 5

Is a Pro forma a valid vat invoice

Answer 5

No

Question 6

What words must appear on a pro forma invoice?

Answer 6

This is not a vat invoice

Question 7

When the goods have been paid for and received what must the business do.

Answer 7

Issue a legitimate VAT invoice

Question 8

What is the tax point?

Answer 8

The time of supply

Question 9

What does the tax point do?

Answer 9

Determines in which period the vat is payable or reclaimable.

Question 10

What is the basic tax point?

Answer 10

The date of supply

Question 11

What is the actual tax point?

Answer 11

When the payment date or invoice date is earlier than the date of supply.

Question 12

Immediate sale - no invoice - when is the tax point

Answer 12

Date of supply

Question 13

Vat invoice issued - when is the tax point?

Answer 13

The date the invoice is issued

Question 14

Vat invoice issued more than 14 days after the date of supply - what is the tax point?

Answer 14

The date the supply took place

Question 15

Payment or invoice issued in advance of supply - when is the tax point?

Answer 15

The date of payment or invoice whichever is earliest

Question 16

Payment in advance of supply and no vat invoice yet issued - when is the tax point?

Answer 16

The date the payment is received.

Question 17

When is the date of supply for goods.?

Answer 17

The date the goods are sent, collected or made available.

Question 18

When is the date of supply for services?

Answer 18

The date the work is finished

Question 19

How do you treat payments in advance and deposits?

Answer 19

Treat each payment as separate tax points

Question 20

What is the tax point of an advance payment?

Answer 20

The date the payment is made or the date the vat invoice is issued for the advance payment whichever is earlier.

Question 21

What is the tax point for the balancing payment?

Answer 21

The date the balancing payment is received or the date the vat invoice is issued for the balancing payment whichever is earliest.

Question 22

When must a vat invoice be sent to a customer

Answer 22

Within 30 days of the basic tax point (the date of supply or if payment is made in advance the date of payment.

Question 23

What documents are not allowable documents to use as evidence of input vat

Answer 23

Pro forma invoice
Statement of account
Order forms
Delivery notes
Letter or emails

Question 24

When can the rule that a valid vat invoice is required as proof that input vat can be reclaimed

Answer 24

Simplified vat invoice for £250 or less
Simple receipt of some form is acceptable for supplies less than £25 including vat so long as the customer believes the supplier to be vat registered.