I am just doing a clients books for the first time and come across something which I need a bit of help on.
They have an invoice for phone & broadband, so vatable supply, and the invoice states that it includes VAT at the appropriate rate but at the top it states this is not a tax invoice.
Quite often broadband companies (Zen comes to mind) send a proforma invoice at the beginning of the month which includes VAT but is not a VAT invoice, then, when the DD goes through they send a "proper" VAT invoice. See if your client's company operates this way. It may come through on an email and s/he may not have printed it out thinking the proforma is OK.
For the sake of one invoice, claim the VAT if you have seen other bills and know that whole invoice carries VAT. If an investigation ensued, I am sure the VAT man would accept that one invoice went a miss, so long as you could prove that it was a valid business expense etc.
Ask the client to try and source the VAT invoice, and replace the filed non vat invoice, if it turns up.. But no need to get knickers in a bunch, if not.
For the record, I'm not trying to encourage people to be lax, just to keep things in perspective. I've been part of a number of investigations, and they don't really sweat the small stuff, if its not taking the mick :)
-- Edited by FoxAccountancyServices on Saturday 11th of May 2013 11:37:00 PM
I`m working at an events catering company,we have a joint working agreement with the City Council ,so if we selling more then the guaranteed (15,000)number of wedding and party, and rent marquees then they gonna to pay 60 % of the event hire to us what actually the customer straight away have paid to the city council.
I was asking from the city councils admin to raise an invoice about the amount what they will pay to us then they told me this is not gonna be an vat invoice .
I don`t understand how is it possible and why should and how the VAT is presented and whether they include VAT in the hire fee or on top or if they charge the VAT inclusive in the advertised figure?
Wow, that was discussed in great length, wasn't it?
I stand by my advice. In an investigation, the VAT office aren't looking to see if you have a VAT invoice for every single transaction, whose got time for that? They look for sales VAT reconciliation, they review "invoices of interest" such as motor, legal, repairs, checking that they bonafide business expenses (this is just a general comment for the small business, I know they can investigate more, but you get my point) I have never seen any inspector mither about a couple of missing invoices from suppliers that can be shown as VAT registered. (I have seen then miss some other whoppers though, let me tell you!)
When I am faced with a missing invoice, I consider:
Is it a supplier I have encountered before - do I know that they are VAT registered. Do I know that their supplies are always vatable.
If I don't know the supplier, and the invoice is for a small amount, I dont claim
If I don't know the supplier and the invoice is a larger amount, I ring the supplier and ask them if they charge VAT on everything. If they do, I claim the VAT and tell the client to chase the invoice. If the supplier doesn't charge VAT on everything, I hold back on the claim until an invoice is produced.
If I know the supplier and I feel confident there is VAT, I claim, and ask the client to chase the invoice
If I know the supplier but its something like stationery which may or may not have VAT, I would air on the side of caution, and not claim VAT unless an invoice was produced.
If it was a BT bill, the normal charge of which was say, £30 a month, and I knew this normally carries VAT on the total, I would claim and ask the client to chase the invoice.
However, if the missing BT bill was for an abnormal £130, I would hold back on claiming the VAT until an invoice was produced, as BT have non vat charges... as do some motor repair bills if an MOT is included.
For me, it's all about weighing up the situation, thinking about what you know of the supplier and its products, as well as, your client's behaviour - you will know if they are usually pretty good with invoices, and you can trust them to chase the missing invoices. Plus is it the "odd" invoice or "nearly every" invoice that is missing? That will make a difference too.
The invoice the OP mentions is for telephone and broadband. My advice is to consider:
Do you know that this is a line for business only use. Ie - its not a home telephone Do you know that this provider usually charges VAT on the whole invoice? Is the invoice an average representation of the other bills from this supplier?
If the answers are yes, the VAT claim would be fair, claim it and ask the client to chase the invoice.
Just my view, folks :)
Edit - fixed a cheeky typo :)
-- Edited by FoxAccountancyServices on Sunday 12th of May 2013 09:17:25 PM
Exactly. Using your noggin. When preparing VAT Returns from client bookkeeping (without seeing any purchase invoices at all) there will invariably be several items per quarter which would either need querying with the client or correcting out of hand.
Missed VAT when there'd normally be standard rate - say BT Too much VAT when it should have been a lower rate - say 5% on Light Heat Power Full rate claimed when the item was patently private
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Sandra. I've no experience of your query but apologise for skipping your question. I'm sure someone else will be a bit more helpful. I notice you haven't yet used the Start A New Topic with the grey button at the top right.
I'm sorry, I am not sure if I have fully grasped what you are trying to say.
If the council owe you money, then shouldn't you be raising the invoice to them, for the 60%, and applying VAT to it, as appropriate? How can they issue you with a VAT invoice, as they arent the ones who are charging the VAT, you are??
Sorry if that's totally wrong, but if I were you, I would start a new thread and break the explanation down so its a bit more readable.
here :- 
