expenses - vat / corporate tax

[namnadasht]

hi

may sound like a very stupid question but im new to contracting and very confused about how expenses are refunded...
is id deducted from vat we charged on invoices or corporate tax ?

[stek]

hi

may sound like a very stupid question but im new to contracting and very confused about how expenses are refunded...
is id deducted from vat we charged on invoices or corporate tax ?

Neither.

[MyUserName]

Have a read through the guides on the right hand side of the screen or speak to your accountant (if you have one).

[Brett at Nixon Williams]

hi

may sound like a very stupid question but im new to contracting and very confused about how expenses are refunded...
is id deducted from vat we charged on invoices or corporate tax ?

If you pay for business expenses personally you will need to document these on some type of an expenses claim form. You will then have to reimburse yourself the total of the claim. A monthly claim is usually the best approach.

If the company pays the expenses direct from the company account then these will not need to be included on an expense claim (an expense claim form should only be used for personally paid business expenses). You should still keep the receipt/purchase invoice as evidence of the expense.

The exact way of doing this will depend on what software you use or how you are keeping your accounting records.

Income, less Expenses = Profit. Corporation Tax is paid on profits.

I would recommend you speak to your accountant and they will be able to explain the best approach. If you have not appointed an accountant it would perhaps be advisable to do so.

Hope this helps.

Brett