Thank you for the ample input folks, well understood now. I did come across a post online that went over this issue as it seems some (not mentioned) clients are giving contractors a hard time when they add VAT on top of an already hefty expenses bill. The taxman makes money twice and the client complains that you can just use the "internal expenses" process not understanding the impact. The advice was to always go via the invoicing route even if you had to end up paying the VAT from your own pocket, which I think most of us will agree with.
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Londoners, contacless on the tube - receipts?
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Originally posted by KayMan View PostThank you for the ample input folks, well understood now. I did come across a post online that went over this issue as it seems some (not mentioned) clients are giving contractors a hard time when they add VAT on top of an already hefty expenses bill. The taxman makes money twice and the client complains that you can just use the "internal expenses" process not understanding the impact. The advice was to always go via the invoicing route even if you had to end up paying the VAT from your own pocket, which I think most of us will agree with.
I haven't had any issues when I have had an expenses line on my invoice, in the couple of times I have had to do it.Last edited by MrMarkyMark; 1 November 2016, 11:01.The Chunt of Chunts.Comment
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Originally posted by KayMan View PostThank you for the ample input folks, well understood now. I did come across a post online that went over this issue as it seems some (not mentioned) clients are giving contractors a hard time when they add VAT on top of an already hefty expenses bill. The taxman makes money twice and the client complains that you can just use the "internal expenses" process not understanding the impact. The advice was to always go via the invoicing route even if you had to end up paying the VAT from your own pocket, which I think most of us will agree with.
For you not to invoice with VAT, it would have to be a disbursement rather than an expense. There are very clear rules around what a disbursement is. And an expense is almost certainly never a disbursement.See You Next TuesdayComment
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Of course this is only relevant if the client wants to see receipts which is not something you have to do, but they'll often refuse to pay if you don't.
An ideal scenario is where the client accepts an expense limit, and you then bill them for that + VAT.See You Next TuesdayComment
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Originally posted by Lance View Posttrain travel (although I make money on mileage so prefer that - in fact I often take a train but charge my client mileage),Comment
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Originally posted by fidot View PostDon't think HMRC would take too kindly to this
I'm not defrauding HMRC. My claim from my own company is genuine and valid.See You Next TuesdayComment
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Originally posted by fidot View PostDon't think HMRC would take too kindly to thisComment
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Originally posted by Lance View Postother posters are quite right. You put VAT on everything you charge !or else!
I have a client who doesn't like to pay VAT on VAT so they insist that I deduct the VAT from expenses before before I claim. On FRS this equates to me giving them a discount, but then again I'm making 5.5% on VAT anyway. So all good.
net invoice =X
gross invoice =1.2X
on FRS 14.5% (assuming that's where you got your 5.5% from)
VAT received from client = 0.2X
VAT paid to HMRC =0.145*1.2X =0.174X
VAT "made" from FRS = 0.2X-0.174X =0.026X = 2.6%Comment
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Originally posted by TheCyclingProgrammer View PostSo long as he's not claiming mileage from HisCo personally when he gets the train, its got nothing to do with HMRC. Its between HisCo and the client what he charges them for travel costs.Comment
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