I'm on FRS and keep my fuel receipts, but it's an old habit which I could get out of
The rationale behind hanging onto them was if ever challenged over doing the mileage it was evidence, belt and braces type of behaviour tbh.
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Previously on "Incorrectly assumed VAT charged on monthly season ticket"
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Originally posted by psychocandy View PostWeird question. As others said, if you're on Flat then it makes no odds anyway.
Saying that, had an accountant a few years back (I binned him after few months) that used to tell me I had to keep receipts from petrol stations in case I got investigated for VAT. No idea where this came from because I was just claiming 45p mile like usual. IMHO **** all to do with how and where I got my fuel from but there we go. If HMRC think I'm not doing the journey at all then thats a different matter (and obviously fraudlent) but I would have thought invoice/timesheet highlighting days billing at site X would clear that one up.
He reckoned that it was to prove you were doing the miles for VAT purposes. Weird.
... if the business can show that the employee has been reimbursed either:- for their actual expenditure; or
- by way of a mileage allowance.
The business must also obtain and retain invoices for all fuel purchased by its employees.
...
HMRC accepts that the amount of the invoice in many cases will not match the input tax claim in respect of business fuel in any one claim period, particularly where fuel is purchased towards the end of the period.
Clearly a claim cannot be supported by a VAT invoice that is dated after the dates covered by the claim. This means, in practice, that it may be advisable for employers to arrange for their employees who use, or may use, their cars for business purposes to retain all fuel invoices.
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Originally posted by psychocandy View PostWeird question. As others said, if you're on Flat then it makes no odds anyway.
Saying that, had an accountant a few years back (I binned him after few months) that used to tell me I had to keep receipts from petrol stations in case I got investigated for VAT. No idea where this came from because I was just claiming 45p mile like usual. IMHO **** all to do with how and where I got my fuel from but there we go. If HMRC think I'm not doing the journey at all then thats a different matter (and obviously fraudlent) but I would have thought invoice/timesheet highlighting days billing at site X would clear that one up.
He reckoned that it was to prove you were doing the miles for VAT purposes. Weird.
Logic is that if you are using HMRC advisory fuel rats to reclaim a vat element of the mileage rate, then you need enough receipts to cover the vat reclaimed. With most people on FRS it is more or less irrelevant.
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Originally posted by psychocandy View PostWeird question. As others said, if you're on Flat then it makes no odds anyway.
Saying that, had an accountant a few years back (I binned him after few months) that used to tell me I had to keep receipts from petrol stations in case I got investigated for VAT. No idea where this came from because I was just claiming 45p mile like usual. IMHO **** all to do with how and where I got my fuel from but there we go. If HMRC think I'm not doing the journey at all then thats a different matter (and obviously fraudlent) but I would have thought invoice/timesheet highlighting days billing at site X would clear that one up.
He reckoned that it was to prove you were doing the miles for VAT purposes. Weird.
Leave a comment:
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Weird question. As others said, if you're on Flat then it makes no odds anyway.
Saying that, had an accountant a few years back (I binned him after few months) that used to tell me I had to keep receipts from petrol stations in case I got investigated for VAT. No idea where this came from because I was just claiming 45p mile like usual. IMHO **** all to do with how and where I got my fuel from but there we go. If HMRC think I'm not doing the journey at all then thats a different matter (and obviously fraudlent) but I would have thought invoice/timesheet highlighting days billing at site X would clear that one up.
He reckoned that it was to prove you were doing the miles for VAT purposes. Weird.
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Good news, but do try and be a bit more careful in future. You were lucky this time as being on the FRS means there was no significant affect on your books or returns, but if you'd been on the normal VAT scheme you'd have some corrections to file.
If in doubt, always check. UK tax rules are far too stupidly complicated and inconsistent to assume anything.
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Response from accountant. Apparently it is always the gross amount that is processed, so no problems...
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Thanks all.
I've queried this with the accountants, so I'll let you know what they have to say...
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Originally posted by Wanderer View PostIn future, you should always get a VAT receipt which will show you the actual VAT paid because some things don't have VAT or it's at a different rate to what you expected....
I do keep a record of VAT in the purchase ledger but only so that at year end I can make a rough assessment of how much being on the FRS has saved/cost the company. If VAT content is not specified on a receipt then I make an educated assumption, it doesn't affect the company accounts or CT calculation in any way.
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Originally posted by tbrain View Postfor a train ticket of e.g. £960, have submitted expenses of £800 net, £160 VAT, £960 gross. I am on FRS
In future, you should always get a VAT receipt which will show you the actual VAT paid because some things don't have VAT or it's at a different rate to what you expected....
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Originally posted by eek View Post[NLUK mode]
Have you thought about asking your accountant
[/NLUK mode]
But seriously as you can't reclaim VAT if you are on the flat rate scheme the £800+£160 vat would have been treated as an expense of £960 so it shouldn't have made any difference regarding profits...
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Originally posted by eek View Post[NLUK mode]
Have you thought about asking your accountant
[/NLUK mode]
But seriously as you can't reclaim VAT if you are on the flat rate scheme the £800+£160 vat would have been treated as an expense of £960 so it shouldn't have made any difference regarding profits...
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Originally posted by tbrain View PostFor years I've been submitting monthly season train ticket expenses, and when doing so have made the assumption that VAT is charged on these tickets at 20% So, when submitting my monthly expenses to the accountant for a train ticket of e.g. £960, have submitted expenses of £800 net, £160 VAT, £960 gross. I am on FRS, and the tickets were for about 6 months paid for using my personal credit card before subsequently being paid for on company debit & credit cards.
So by incorrectly assuming VAT was applied, have I lost out in any way e.g. increased corporation tax bill?
Have you thought about asking your accountant
[/NLUK mode]
But seriously as you can't reclaim VAT if you are on the flat rate scheme the £800+£160 vat would have been treated as an expense of £960 so it shouldn't have made any difference regarding profits...
Leave a comment:
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Incorrectly assumed VAT charged on monthly season ticket
For years I've been submitting monthly season train ticket expenses, and when doing so have made the assumption that VAT is charged on these tickets at 20% So, when submitting my monthly expenses to the accountant for a train ticket of e.g. £960, have submitted expenses of £800 net, £160 VAT, £960 gross. I am on FRS, and the tickets were for about 6 months paid for using my personal credit card before subsequently being paid for on company debit & credit cards.
So by incorrectly assuming VAT was applied, have I lost out in any way e.g. increased corporation tax bill?Tags: None
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