After 12 years of bookkeeping I've never come across this before:
One of my clients ordered some hampers for his clients for their Christmas gifts. There was nothing out of the ordinary - a few chocs and festive piccies - no alcohol. When I requested a VAT invoice from the business that supplied the hampers, it listed the VAT as being 8.2%
There was only hampers on the invoice - nothing else - and the VAT line actually had the wording ' VAT charged at 8.2%'
Has anyone any idea what this might be? I thought about phoning the business and asking them - but thought I'd run it by the forum first.
Does anyone deal with partial exemption businesses? Do they have to show the VAT like this?
Carol
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Carol Saunders Lady of Ledger Book Keeping Telford, Shropshire
I was under the impression a hamper was treated as a mixed supply, with VAT charged according to what's actually in the hamper. (so if £60 worth of the contents were standard rated goods (assuming that is the VAT inclusive price), and £20 was zero rated, the VAT would be £10 - i.e. £70 net, £80 gross.
It could be that what the supplier has done is worked out the VAT as an overall proportion based on the contents for the sake of simplicity - which is probably fine for calculating it in the first place, provided they are consistent with the contents - but they shouldn't be wording it like that on the invoice, because it would lead to people inferring that 8.2% is some kind of standard rate for hampers.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
I've also spoken to the business that sent the invoice, and they've confirmed this is the case. Apparently their systems have each hamper worked out as to what the spread is of each VATable and non Vatable supply in each one.
I'm glad QuickBooks allows us to alter the VAT amount easily - there are some accounting packages that don't let you do this without a lot of hassle aren't there?
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Carol Saunders Lady of Ledger Book Keeping Telford, Shropshire
