I have a client who is giving away a prize to a magazine for a competition. How is this treated eg for VAT. eg raising an invoice, reclaiming input tax, paying output tax etc. Thank u
I believe VAT should be accounted for as it is really a 'sale'. You could raise a 'sponsorship' invoice for VAT purposes only which is probably better than journaling the cost to 'marketing' and 'output' tax. This is my first thought on the matter.....perhaps others can disagree/concur?
