It has become crystal clear that my accountant is completely clueless about reverse charge VAT so I am pretty much having to do this myself. Just wondering if anyone here had experience with it and could check my calculations..
revenue exc VAT 50k, so vat is 10k
all purchases exc VAT 8k, vat reclaimed 600
In a normal situation VAT payable is 10k - 600 = 9400
But 5k was charged by a contractor abroad so we apply reverse charge rules
5k * 0.2 = 1000 reverse charge VAT
So Box 1 becomes 10k + 1000 = 11000
Box 4 becomes 600 + 1000 = 1600
So Box 5 (total payable) remains unchanged 11000 - 1600 = 9400
However from what have read boxes 6 and 7 are also affected. In a normal scenario Box 6 is 50k and Box 7 is 8k. Am I correct to understand that 5k is also added to Box 6 and Box 7? Even though box 7 ALREADY includes the 5k since it has been paid.
revenue exc VAT 50k, so vat is 10k
all purchases exc VAT 8k, vat reclaimed 600
In a normal situation VAT payable is 10k - 600 = 9400
But 5k was charged by a contractor abroad so we apply reverse charge rules
5k * 0.2 = 1000 reverse charge VAT
So Box 1 becomes 10k + 1000 = 11000
Box 4 becomes 600 + 1000 = 1600
So Box 5 (total payable) remains unchanged 11000 - 1600 = 9400
However from what have read boxes 6 and 7 are also affected. In a normal scenario Box 6 is 50k and Box 7 is 8k. Am I correct to understand that 5k is also added to Box 6 and Box 7? Even though box 7 ALREADY includes the 5k since it has been paid.
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