Can a trader making exempt supplies apply for VAT?
Can a trader making zero-rated supplies apply for VAT?
What is the historic turnover test?
At the end of each month, the trader must look at the cumulative total of taxable supplies for the last 12 months, or since commencing trade, whichever is the shorter
When must a trader notify HMRC in a historic turnover test?
Within 30 days, registration is effective from the first day of the second month after taxable supplies exceed threshold
What is the future prospects test?
This test is considered at any time, when taxable supplies in the next 30 days in isolation are expected to exceed £83,000.
When must a trader notify HMRC in a future prospects test?
Before the end of the 30 days, registration effectiqve from the beginning of the 30 day period.
How is a VAT group treated?
Treated as if it is a single company for the purposes of VAT. Group registration is optional; not all members of the group have to join the VAT group.
How is group vat return treated?
The representative member submits a single VAT return covering all group members, but all companies are jointly and severally liable for the VAT payable.
What are advantages of group registration?
VAT on intra group supplies eliminated
One return required
What are disadvantages of group registration?
All members remain jointly and severally liable
A single return may cause administrative difficulties collecting and collating information
What can you claim for pre registration VAT?
Goods in inventory - not been acquired more that 4 years
Services - six months prior
When does a person need o compulsory deregister?
Within 30 days of ceasing to make taxable supplies
VAT is cancelled from the date of cessation or a mutually agreed later date
What is the amount that is waved on reregistration?
VAT on sale is treated how?
Normal taxable supply - charge output VAT on assets transferred.
Going concern - not treated as supply
What are the conditions for transfer of going concern?
- The business is transferred as a going concern.
- There is no significant break in the trading.
- The same type of trade is carried on after the transfer.
- The new owner is or is liable to be registered for VAT, immediately after the transfer.
What is the basic tax point?
Goods - when collected, delivered or made available
Service - When performed
What is the actual tax point?
- calculate BTP
- On or before BTP has an invoice been issued or payment?
- Yes - ATP earlier date
- No - invoice within 14 days?
- Yes? ATP = Invoice
- No? - BTP
How is goods taken for own use treated?
- Replacement value of the supplies
How are gifts treated?
Taxable supplies - except if goods to the same person cost less than £50 or business samples
Services are not taxable
What can’t you claim VAT on?
Business Entertaining - (overseas allowable)
Motor cars - except if 100% business use
Leased? - 50% where private use
How is a fuel scale charge treated?
As output VAT
How do you get relief for impairment losses?
Must be at least 6 months old from due date and be written off. Must be made within 4 years and six months of being due. added to input VAT