A company registered for Value Added Tax (VAT) in the United Kingdom. The following information is available in respect for the quarter ended 31 March 2021: 1. Invoices were issued for sales to VAT registered customers of £16,200 in respect of exempt sales, £5,650 in respect of reduced rate sales and £205,250 in respect of standard rated sales. The reduced rate and standard rated sales figures are exclusive of VAT. 2. Invoices were issued for sales to Non-VAT registered customers of £32,350 in respect of exempt sales and £25,670 in respect of standard rated sales. The standard rated sales figure is inclusive of VAT. 3. On 25 March 2021 the company has received a deposit for standard rated services to be supplied to a VAT registered customer on 31 March 2021. The customer paid the balancing payment on 31 March 2019. The company issued an invoice on 2 April 2021. 4. The sales manager of the company is provided with free fuel for both business and private mileage driven in his company motor car. the company paid £995 for fuel during the quarter of which 30% was in relation to private use. The directors of the company wish to change their invoicing process so that customers are only issued with an invoice where there is a legal requirement to do so. For the quarters ended 31 December 2019, 31 March 2020 and 30 September 2020 the firm was late in submitting its VAT returns and in paying the related VAT liabilities. All of the firm's other VAT returns have been submitted on time. Note: Relevant sections of this part are to be dealt with according to the actual UK VAT rules in the tax year 2020-21. Required: Calculate the amount of output VAT payable by the company in respect of the invoices issued in (1) and (2) for the quarter ended 31 March 2021. Identify the tax points, for deposit and balance payment, for the services provided in (3). Calculate the amounts of input VAT and output VAT that are recoverable or payable by the company for the quarter ended 31 March 2021 in respect of the sales manager's company motor car.
A company registered for Value Added Tax (VAT) in the United Kingdom. The following information is available in respect for the quarter ended 31 March 2021:
1. Invoices were issued for sales to VAT registered customers of £16,200 in respect of exempt sales, £5,650 in respect of reduced rate sales and £205,250 in respect of standard rated sales. The reduced rate and standard rated sales figures are exclusive of VAT.
2. Invoices were issued for sales to Non-VAT registered customers of £32,350 in respect of exempt sales and £25,670 in respect of standard rated sales. The standard rated sales figure is inclusive of VAT.
3. On 25 March 2021 the company has received a deposit for standard rated services to be supplied to a VAT registered customer on 31 March 2021. The customer paid the balancing payment on 31 March 2019. The company issued an invoice on 2 April 2021.
4. The sales manager of the company is provided with free fuel for both business and private mileage driven in his company motor car. the company paid £995 for fuel during the quarter of which 30% was in relation to private use.
The directors of the company wish to change their invoicing process so that customers are only issued with an invoice where there is a legal requirement to do so.
For the quarters ended 31 December 2019, 31 March 2020 and 30 September 2020 the firm was late in submitting its VAT returns and in paying the related VAT liabilities. All of the firm's other VAT returns have been submitted on time.
Note: Relevant sections of this part are to be dealt with according to the actual UK VAT rules in the tax year 2020-21.
Required:
- Calculate the amount of output VAT payable by the company in respect of the invoices issued in (1) and (2) for the quarter ended 31 March 2021.
- Identify the tax points, for deposit and balance payment, for the services provided in (3).
- Calculate the amounts of input VAT and output VAT that are recoverable or payable by the company for the quarter ended 31 March 2021 in respect of the sales manager's company motor car.
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