Chapter 8 - Time of Supply

Question 1

Time of Supply

Answer 1

Gives us the date of sale or purchase for VAT purposes. The date is crucial as it determines which VAT return the output or input tax is accounted for (and paid)

Question 2

Basic Tax Point

Answer 2

For a supply, the BTP is the date the goods are delivered, made available or collected
For services, date of supply is when the services are performed - ie all work is done with exception of an invoice being raised

Question 3

Basic Tax Point Override

Answer 3

The BTP can be overridden by a different date in two situations:

1) if there is a receipt of a payment or a tax invoice is issued on a date before the BTP date, the earlier date becomes the tax point used
2) if an earlier tax point does not apply and an invoice is issued within 14 days after the BTP, then the invoice issue date becomes the tax point

Question 4

Deposits

Answer 4

It is possible to have more than one tax point for the same supply, for example where a deposit is paid upfront and the balance paid when the goods are delivered.
The deposit and balancing payment will each have their own tax points

Question 5

Special Rules for Services

Answer 5

Sometimes with services, the service can be ongoing and not end unless the contract is terminated. For continuous supply of services there is not a basic tax point, there is only payment and invoice, so the earlier of the two will determine the tax point