{"id":4142,"date":"2022-02-02T09:18:15","date_gmt":"2022-02-02T09:18:15","guid":{"rendered":"https:\/\/way2vat.com\/?p=4142"},"modified":"2022-10-31T06:54:28","modified_gmt":"2022-10-31T06:54:28","slug":"vat_gst-errors","status":"publish","type":"post","link":"https:\/\/way2vat.com\/vat_gst-errors\/","title":{"rendered":"VAT\\GST Errors"},"content":{"rendered":"

We are often asked by our clients if we can review whether their procedures and processes for VAT\\GST recovery are working correctly and efficiently.\u00a0 Most clients are looking to recover extra VAT\\GST but very often we find that mistakes and errors have crept into the VAT\\GST recovery process.\u00a0\u00a0<\/span><\/p>\n

Often it is the same errors that keep repeating themselves and many of these are quite basic.\u00a0 Frequently, they could easily have been avoided and they can often be costly if a business needs to repay VAT\\GST.\u00a0\u00a0<\/span><\/p>\n

We thought it may be helpful if we detail some of the most common mistakes:<\/span><\/p>\n

 <\/p>\n

1<\/span>.Lack of VAT\\GST invoices or other evidence<\/span><\/span> \u2013 this one seems so obvious, it almost seems unnecessary to include, but it is the most common reason why VAT\\GST claims are disallowed. \u00a0 Simply put if you don\u2019t have a VAT\\GST invoice you can\u2019t claim back the VAT\\GST.\u00a0 Shipping notes, emails, delivery documents, purchase orders and proforma invoices are not VAT\\GST invoices and do not give a business the right to recover VAT\\GST.\u00a0 Under the VAT\\GST rules, a supplier must issue a proper VAT\\GST invoice if it charges VAT\\GST.<\/span><\/p>\n

The tax authorities have the discretion to allow a business to provide alternative evidence to recover VAT\\GST. The level of alternative evidence is high and to avoid having to provide this, the business should chase up missing invoices prior to submitting their VAT\\GST return.<\/p>\n

2<\/span>.Invoices not Paid after More than 6 Months<\/span><\/span> \u2013 A VAT\\GST inspector will often ask for an aged creditor list.\u00a0 The reason is that if a business has recovered VAT\\GST but hasn\u2019t paid the invoice, it is required to repay any input VAT\\GST claimed where the invoice is more than six months overdue for payment. This rule is automatic and does not depend on the supplier informing the customer that it will be claiming bad debt relief. <\/span><\/p>\n

3<\/span>.Claiming VAT\\GST twice<\/span> \u2013 where a supplier issues a payment request and then issues a VAT\\GST invoice, sometimes a customer will process both documents thereby recovering double the amount of VAT\\GST.\u00a0 Clearly this is incorrect.<\/p>\n

4.VAT\\GST on Business Entertainment<\/span> \u2013 VAT\\GST is not recoverable on business entertainment. There may be scope to recover VAT\\GST on the cost of basic refreshments provided to overseas customers\/clients, but the rules are quite restrictive.\u00a0 To add to the confusion, where VAT\\GST is incurred on staff costs e.g., the office Christmas party the VAT\\GST is recoverable (subject to the normal rules).<\/p>\n

5.Import VAT\\GST<\/span><\/span> \u2013 When businesses import goods into the UK, if the freight agent\/carrier requests a business to pay import VAT\\GST, this can only be recovered if the business has the correct document.\u00a0 In the UK this document is called a \u201cMonthly Import VAT\\GST Certificate\u201d or \u201cC79 certificate\u201d’, which is issued by HM Revenue & Customs (\u201cHMRC\u201d).\u00a0\u00a0<\/span><\/p>\n

VAT\\GST is not recoverable with the invoice issued by the freight agent\/carrier as this merely represents the amounts paid by the freight agent\/carrier on behalf of the business. Since the start of 2021 in the UK, in most cases it should not be necessary for VAT\\GST registered businesses to pay import VAT\\GST at the point goods are entered into the UK as under the <\/span>postponed VAT\\GST accounting<\/b> rules, import VAT\\GST can be recorded on a VAT\\GST registered business\u2019s VAT\\GST return.\u00a0 This will assist importers of goods as they will not have the cash flow cost of paying import VAT\\GST and then waiting to recover the VAT\\GST on their VAT\\GST returns.\u00a0\u00a0<\/span><\/p>\n

Contact us to learn more about VAT\\GST.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

We are often asked by our clients if we can review whether their procedures and processes for VAT\\GST recovery are working correctly and efficiently.\u00a0 Most clients are looking to recover extra VAT\\GST but very often we find that mistakes and errors have crept into the VAT\\GST recovery process.\u00a0\u00a0 Often it is the same errors that […]<\/p>\n","protected":false},"author":1,"featured_media":4144,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[26,1],"tags":[],"class_list":["post-4142","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","category-vatgst"],"acf":[],"yoast_head":"\nVAT\\GST Errors - w2v<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/way2vat.com\/vat_gst-errors\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"VAT\\GST Errors - w2v\" \/>\n<meta property=\"og:description\" content=\"We are often asked by our clients if we can review whether their procedures and processes for VATGST recovery are working correctly and efficiently.\u00a0 Most clients are looking to recover extra VATGST but very often we find that mistakes and errors have crept into the VATGST recovery process.\u00a0\u00a0 Often it is the same errors that […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/way2vat.com\/vat_gst-errors\/\" \/>\n<meta property=\"og:site_name\" content=\"w2v\" \/>\n<meta property=\"article:published_time\" content=\"2022-02-02T09:18:15+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-10-31T06:54:28+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/way2vat.com\/wp-content\/uploads\/2022\/02\/404169_BLOG-BANNER_55-1-copy.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"627\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"elad@finext.co.il\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"elad@finext.co.il\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/way2vat.com\/vat_gst-errors\/\",\"url\":\"https:\/\/way2vat.com\/vat_gst-errors\/\",\"name\":\"VAT\\\\GST Errors - 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