Profit and Loss & VAT

by **flashman** on Sun Aug 16, 2009 3:40 pm

We are registered for VAT in France not in the UK as our line of work is catered ski holidays. We sell holidays with French TVA included in the price and reclaim TVA in France on outgoings such as catering supplies, transport etc etc. We are however still a UK limited company and so need to complete CT600 forms at this time of year.

This is the first year that I am preparing Corporation Tax returns since we got involved with VAT. In the profit and loss account do i show income and expenditure with VAT included or not? Apologies if this seems like a basic question. Doing your own accounts is a steep learning curve!

by **pawncob** on Sun Aug 16, 2009 7:10 pm

VAT is normally excluded from all accounts.

by **RAL** on Mon Aug 17, 2009 8:16 am

I am afraid the answer is not straightforward. If you selling packaged holidays then you have to operate TOMS for VAT purpose. So VAT is generally excluded from Profit and loss account, however you have to operate margin scheme.
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by **flashman** on Wed Aug 19, 2009 3:16 pm

Thanks for the advice. We are not within TOMS as we don't sell packages. I should have explained more clearly, we are an accommodation provider in the Alps and customers book their own flights, ski passes etc. Seems like there shouldn't be any VAT shown in accounts.

Does anyone know if I need to fill in any forms to tell HMRC that all of our supplies are outside the scope of UK VAT? We are over the VAT threshold but place of supply rules dictate that as all of our business is for a property in France we have had to register in France. We've done this but as yet haven't done anything with regards HMRC. Do we simply just not register for UK VAT or is there a nice long form to fill in to explain that our supplies don't fall within the scope of UK VAT?

by **RAL** on Fri Aug 21, 2009 5:17 am

flashman wrote:We are registered for VAT in France not in the UK as our line of work is catered ski holidays. We sell holidays with French TVA included in the price and reclaim TVA in France on outgoings such as catering supplies, transport etc etc. We are however still a UK limited company and so need to complete CT600 forms at this time of year.

flashman wrote:Thanks for the advice. We are not within TOMS as we don't sell packages. I should have explained more clearly, we are an accommodation provider in the Alps and customers book their own flights, ski passes etc. Seems like there shouldn't be any VAT shown in accounts.

Does anyone know if I need to fill in any forms to tell HMRC that all of our supplies are outside the scope of UK VAT? We are over the VAT threshold but place of supply rules dictate that as all of our business is for a property in France we have had to register in France. We've done this but as yet haven't done anything with regards HMRC. Do we simply just not register for UK VAT or is there a nice long form to fill in to explain that our supplies don't fall within the scope of UK VAT?

You clearly mentioned in the first post that you claim vat on catering supplies and transport. If you selling accomodation and transport together I am afraid it falls within TOMS. So you need to speak to a vat expert to ascertain your position.

As regard to your second part of question, same applies whether you need to register for vat will depend on TOMS so It would be worth spending money to get expert advice.

by **flashman** on Fri Aug 21, 2009 11:46 pm

Thanks RAL, I appreciate your advice and totally see where you are coming from but we have taken expert advice on this in the past. I would dearly love to register under TOMS and not deal with the French government. Believe me, they are the bain of my life! However, we don't sell packages. We don't sell transport to customers. We have vehicles for the use of chalet staff and under French VAT rules can reclaim 80% of diesel. Our catered chalet holidays involve us buying food in France, and the 5.5% reduced rate can be reclaimed on this, as well as the full 19.6% on alcohol.

Anyway, I digress. We are outside the scope of UK VAT. I wish we weren't but place of supply rules seem pretty clear, and the HMRC helpline told me the same thing last year when we registered in France on their advice. It just seems odd that I haven't had to sign any decleration to say that as a UK Ltd company we are trading over the threshold but have not registered as 100% of supplies are outside the scope. Perhaps we can register in UK as well? It would seem strange though as we would be able to claim VAT on any purchases but would never pay any VAT.

Anyway, thanks for your help and I will keep plugging away!