Hi we have a sales rep who regularly travels to Germany to check on our customers. Whilst in Germany he records his mileage in his own vehicle and subsistence he pays for personally and reclaims when he returns to our UK based office.
He will give me all his EURO receipts on his return along with his bank statement so I can see the GBP equivalent to pay him. My question is can i claim VAT at for these receipts, will it be at 20%?
Hi Lisa What is the legal status of the business? Ltd?
Before you consider the Vat you need to consider the basis on which you are paying the expenses and whether or not that is correct.
Wholey, exclusively and necessary?
Do the varied expenses fit with the relevant legislation for allowability. Are they scales rates, above or below.
Eg. You don't say if you are paying against his petrol receipts in Germany? Plus on what basis do you recompense him for travel in the Uk? Issues of private use. Potential benefits issues.
Perhaps you can expand.
PS there are much better/simpler ways of processing the expenses which negate the need for all the shenanigans with his private bank statements, which could open up the employee to uncalled for scrutiny, as well as the business, in the event of an HMRC inspection.
Edited for typos
-- Edited by Cheshire on Friday 11th of May 2018 07:45:45 AM
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
