Google AdWords and VAT Flat Rate scheme

Postby blainpritchard on Mon Nov 20, 2006 7:50 am

Confused as to treatment of supplies of advertising by Google using AdWords. It appears that the cost should be shown as an EEC aquisition(which apparently includes services) calculate the tax and include in box 2 and pay over the VAT on them with no reclaim of vat in box 4 if you are using the flat rate scheme. Is this correct as the HMRC booklets appear to be somewhat contradictory in particulat para 12.5 of leaflet 733. Any explanation would be appreciated
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Postby Generix on Fri Nov 24, 2006 6:41 am

As you are operating the Flat Rate Scheme you do not have to include the reverse charge for services within your turnover. So just ignore it. Any queries contact me on generixbanshee@hotmail.com or post reply here.

(Not sure on how the new domestic reverse charge will effect this scheme, although as Germany are blocking it seemingly indefinately that may never happen)
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