VAT silly mistakes

Question 1

Flat rate scheme

Answer 1

VAT % in HTT
No input VAT recovered - only pay OUTPUT VAT
Taxable turnover limit = £150,000

Question 2

Limited cost business

Answer 2

VAT = 16.5%
When VAT inclusive turnover of relevant goods is LESS THAN

2% of VAT inclusive turnover
£250 per quarter

Question 3

VAT exclusive figure

Answer 3

VAT = * 20%

Question 4

VAT inclusive figure

Answer 4

VAT = 20/120

Question 5

Due date - VAT

Answer 5

1 month and 7 days after end of quarter

Question 6

Partial exemption tests (1 + 2 and De minimis)

Answer 6

Test 1:
Total input VAT < £625 pm
AND
VAT exempt supplies < 50% of all supplies

Test 2:
Total input VAT less input VAT directly attributable to taxable supplies < £625 pm
AND
Exempt supplies < 50% of all supplies

Apportion non-attributable input VAT using % (round up)
% = Total taxable supplies / Total supplies * non attributable input VAT

De minimis:
All input VAT is recoverable if final de minimis < £625 pm and < 50% of total is met

Question 7

CGS (Capital goods scheme)

Answer 7

Calculate initial recovery of input VAT

Adjustment for year
Total input VAT / 10 or 5 years x (TS % now - TS% on initial recovery)

Extra adjustment on sale needed (Taxable disposal = 100%, Exempt disposal = 0%)

Question 8

Pre-registration VAT recoverable

Answer 8

Goods for 100% BU = 4 years before registration
Services for 100% BU = 6 months before registration

Question 9

1st time buyer (SDLT)

Answer 9

SDLT exempt up to £500,000

Question 10

Additional residential property (SDLT)

Answer 10

+3% for each band

Question 11

VAT - Cars

Answer 11

Blocked from VAT

Question 12

VAT - other goods

Answer 12

Can recover BU % of good

Question 13

Stamp Duty - Shares

Answer 13

Due date pg 285
0.5% * consideration
Round up to nearest £5

Question 14

SDRT - listed shares

Answer 14

Due date pg 285
0.5% * consideration
NO rounding

Question 15

Overseas VAT:
Goods

Answer 15

Export of goods = Zero-rated
Seller accounts for VAT in own country

Import of goods = VAT neutral
Account for input and output VAT @20%

Question 16

Overseas VAT:
Services

Answer 16

Services exports:
Not VAT registered (individual)
Use UK VAT rules = 20% output VAT

Services imports:
Reverse charge (charge input and output VAT in UK)

Question 17

Single supply of VAT

Answer 17

Single supply = treated as 1 supply for VAT - even if made up of different things (e.g. Medical advice + medicine).

If an incidental/ancillary element of supply/customers offered same price despite difference in what is supplied = treat as SINGLE SUPPLY

Question 18

Multiple supply of VAT

Answer 18

Multiple supply - individual elements are treated separately for VAT - each element must be clearly identifiable

Apportion VAT by splitting amount based on cost / MV of each element