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figaro


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VAT partial exemption...
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I do the books for a healthcare & recruitment company that produces around 70% of VAT exempt supplies and the other 30% at the standard VAT rate.

Am I right in saying that they:

Can claim VAT back on purchases made directly in relation to services that they charge standard VAT on

Cannot claim any VAT back on purchases in relation to their VAT exempt supplies

Cannot claim ANY vat back on overhead expenses

Do I need to bother with the de Minimis test?  As the VAT exempt supplies are well over 50% (Please say I don't)evileye

Thanks Folks

 

Giulio

 



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leshoward


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Not quite correct; input tax on overheads is claimed in proportion to taxable supplies / total supplies. Although you can apply for a Special Method using a different basis if you wish. (Sorry for the error first time!)

And yes, you do need to do the de minimis test. An Excel calc should do the job.



-- Edited by leshoward on Tuesday 24th of May 2016 06:58:23 PM

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RobH


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Les I thought you could recover vat on overheads in the ratio of taxable supplies over total supplies?

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Rob
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