Book taxi invoice as cost in P&L account, and claim VAT - sounds OK
Issue invoice to Parent as Other sales in P&L and charge VAT - no, you should post to the original place where the taxi invoice was posted to (so that the cost cancels out), and I don't think there should be any VAT.
I agree with gbm about the treatment of the Taxi cost to the UK firm as a normal expense via P&L claiming the VAT back as applicable and then raise invoice to parent company allocating the income to the same expense code.
However, I do believe that the invoice to the parent company should be a VAT invoice including the VAT at the standard UK rate (currently 20%). My reason for this is that the supply of the service took place in the UK.
I hope thats correct and maybe someone can back me up on the VAT side of things.
Hello, Thank you. If my Japanese colleague had paid for the taxi service himself, he would have paid the VAT. For this reason, I tend to agree with Merlion ABS, that I recharge the parent, including UK VAT. Is is absolutely incorrect to record the recharge as Misc. sales, instead of using the cost account, or do I have a choice? regards
I agree with the Grand Bauhinia Medal taxi companies on the cost of treatment, the United Kingdom as a normal cost, claiming that after the VAT through the profit and loss, and then propose the distribution of income for the parent code for the same invoice cost.
Dont record it as Misc Sales, its not a sale, its a recharge of a cost, the recharge invoice to the Japanese company should offset the original expense.
