VAT Flat Rate Scheme Update

[radish2008]

Is a hotel stay a good? Is it a tangible object?

Then you can answer your questions yourself.

Wouldn't it be on the list of major exclusions if it was excluded ? I seem to remember it was on there before but not now.

[radish2008]

For something that's actually quite simple, its amazing how many threads we've had about this. People asking the same questions again and again...

It's amazing how much more energy you've expended when a simple yes or no would have done.

As the 'guidance' from the government on a whole range of issues is changing constantly it's not unreasonable to assume this might have changed also.

[Alan @ BroomeAffinity]

VAT Flat Rate Scheme Update

I'm not incurring more expenses. The £ 12k I'm currently paying for accommodation has no VAT element but if I spent that £ 12k on hotels and I came out of the FRS then I'd be able to claim the VAT back on that = £ 2,400.

Incidentally, I just spoke to a letting agent regarding Company Lets. Has anybody got any experience of this? Entertaining the idea of taking out a company let, claiming the VAT back on it and subletting one of the rooms to somebody else.

Small point: £12k hotel accommodation only has £2k VAT, not £2.4k.

Regarding company lets, you're no more likely to be dealing with a VAT registered landlord by doing it this way I don't think.

[d000hg]

Neither cap ex or accounting fees count. There's a list up there ^^^ somewhere.

You can reclaim the VAT on this expenditure but it doesn't count toward the 2%. These are easily, and often, confused.

Cheers. I was aware about services but not Capital Expenditure.

Although... isn't there another argument about when things are Capital and when they're not?

[radish2008]

Is a hotel stay a good? Is it a tangible object?

Then you can answer your questions yourself.

I totally take your point, however, I've just trawled through VAT Notice 733 and there is no mention of hotels or accommodation at all (apart from rent). I just find it odd as this must be one of the most commonly claimed expenses.

[oliverson]

Small point: £12k hotel accommodation only has £2k VAT, not £2.4k.

Regarding company lets, you're no more likely to be dealing with a VAT registered landlord by doing it this way I don't think.

Don't really understand your point about the company let.

[TheCyclingProgrammer]

It's amazing how much more energy you've expended when a simple yes or no would have done.

I've given detailed replies, multiple times, on pretty much every thread on this topic (and so have many others), so how about you do one and use the search function.

If you can't even work out the difference between a good and a service, then perhaps VAT is too complicated for you and you should just come off it and keep your turnover below the threshold.

[TheCyclingProgrammer]

Although... isn't there another argument about when things are Capital and when they're not?

For the purposes of this test, whether you choose to capitalise the asset in your accounts is not relevant. Whether something is treated as an asset for VAT purposes is outlined in the VAT regulations.

Capital expenditure - is the cost of any goods which are bought to be used in the business over a period of time (for example, longer than a year). Examples include equipment such as a computer, mobile phone, office furniture, a tablet or a printer, even if they are not necessarily treated as capital assets for accounting purposes. The legislation that describes capital expenditure goods can be found in VAT Regulations 1995, 55A (1).

https://www.gov.uk/government/public...technical-note

[TheCyclingProgrammer]

Could we get some kind of sticky/FAQ in this forum on this subject?

[SueEllen]

Cheers. I was aware about services but not Capital Expenditure.

Although... isn't there another argument about when things are Capital and when they're not?

Yes it depends on what your accountant thinks.

Being in IT you should explain to them why something costing £300 or under isn't capital expenditure and why something costing over this is.