Business Trip Abroad

[hugebrain]

Hi,

How do I invoice my customer / declare it to the tax man if I go for business trips to the U.S.? I have to spend money on flights, hotel, taxis, meals etcetera and then invoice the customer.

Should I add VAT to the invoice? Also, whom do I pay tax for the income I get while working there (Uncle Sam or Gordo), I have both passports.

International jet set isn't all it's cracked up to be.

[Mustang]

Seek help from an accountant! I am not one but my intuitive comments would be: -

1) Depends where you are resident and where the company is registered.

2) Expenses in the US could be claimed back at their sterling equivalent.

3) VAT has not been paid so it cant be declared or claimed back!

4) Invoices would have to be raised in the currency you were to be paid in otherwise you would be hit for bank charges. They would need to be converted to your companies base currency anyway to put on the books.

HTH - I am sure someone will tell me if I am wrong!

[ratewhore]

you can add VAT because it's not the actual flight or meal you are billing for, it's the service of taking the flight or meal.

According to my accountant at least...

[Lucifer Box]

I will go further than ratewhore. If you are VAT registered in the UK and are billing a UK client you MUST add VAT to the invoice total. As explained, you are not reselling a flight, hotel accomodation, taxi ride or what have you, you are billing for a value-added service.

[VinnyB]

The approach I take is this.

My flight might be 150 GBP inc VAT, Hotel might be 80 Euros, Meals might be 50 Euros.
So 150 GBP + 130 Euros. Using the Exch Rate from Ruetuers (as an example) this gives me 150 + 85.80 (130 Euros x0.66)= 235.80 GBP.

I then invoice my client for 235.80 GBP + VAT.
I then claim the 235.80 GBP as an expense from my company.

[hugebrain]

Still Confused

The approach I take is this.

My flight might be 150 GBP inc VAT, Hotel might be 80 Euros, Meals might be 50 Euros.
So 150 GBP + 130 Euros. Using the Exch Rate from Ruetuers (as an example) this gives me 150 + 85.80 (130 Euros x0.66)= 235.80 GBP.

I then invoice my client for 235.80 GBP + VAT.
I then claim the 235.80 GBP as an expense from my company.

Wouldn't the client be paying VAT on the flight twice, (BA charge VAT and then I charge VAT again)?

I'm beginning to think I shouldn't include it - anything British will already have VAT in it, anything American doesn't incur VAT. Not sure how I explain it on the VAT/Corporation Tax returns though. It would look like any other payment from the Client to my Company, so the taxman might expect his cut.

[Paddy]

Wouldn't the client be paying VAT on the flight twice, (BA charge VAT and then I charge VAT again)?

I'm beginning to think I shouldn't include it - anything British will already have VAT in it, anything American doesn't incur VAT. Not sure how I explain it on the VAT/Corporation Tax returns though. It would look like any other payment from the Client to my Company, so the taxman might expect his cut.

There is no VAT on Flights. If you pay VAT abroad, you best write it off. You need add VAT on the total. Some times you have to add VAT on top of VAT.

[hugebrain]

puzzled

There is no VAT on Flights. If you pay VAT abroad, you best write it off. You need add VAT on the total. Some times you have to add VAT on top of VAT.

I think I need a new username. I still don't understand.

There is no VAT on flights, but I need to add VAT to the price of the flight!?

I guess I'll just add the VAT onto the invoice and see what happens. Hopefully my accountant can explain it better.

[VinnyB]

I think I need a new username. I still don't understand.

There is no VAT on flights, but I need to add VAT to the price of the flight!?

I guess I'll just add the VAT onto the invoice and see what happens. Hopefully my accountant can explain it better.

Going back to my previous post:

My flight might be 150 GBP inc VAT, Hotel might be 80 Euros, Meals might be 50 Euros.
So 150 GBP + 130 Euros. Using the Exch Rate from Ruetuers (as an example) this gives me 150 + 85.80 (130 Euros x0.66)= 235.80 GBP. At this point I have paid for this out of my personal funds, therefore I will claim £235.80 from my company as an expense.

I then invoice my client for 235.80 GBP + VAT. I show this element as a seperate line on my invoice.

Not sure if it explains this appraoch, but my company uses the Flat Rate VAT scheme and I do not claim VAT back on items bought for the business.

[Lucifer Box]

I think I need a new username. I still don't understand.

There is no VAT on flights, but I need to add VAT to the price of the flight!?

I guess I'll just add the VAT onto the invoice and see what happens. Hopefully my accountant can explain it better.

Yes, you most certainly should. If you are VAT registered you MUST add VAT to your invoice total, regardless of what the line items are or what country you incurred the expense in. You are not reselling your client a flight (you're not a tour operator), you are providing your client with a value-added service on which VAT is due. It just so happens that one element of your service is a flight on which you do not pay VAT, but that is irrelevant. Your client will have no issue with this and would almost certainly query it if you do not add VAT.