VAT - Debt relief

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Account for VAT with factoring arrangements

Owing to cash-flow difficulties caused by the coronavirus outbreak, you have decided to use a factoring arrangement as an alternative to a bank loan. As a cash accounting scheme user, how do you ensure your VAT returns are correct?
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BAD DEBT RELIEF - 28.02.2020

Avoiding costly mistakes with bad debt relief

Unless you use the cash accounting scheme, relief for VAT on bad debts needs to be reclaimed. However, there is a particular procedure to follow in order for a valid claim to be made. What do you need to do?
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BAD DEBT RELIEF - 12.12.2019

VAT flat rate scheme users missing out on bad debt relief

If a customer fails to pay your invoice you can, after six months, claim a refund of the corresponding VAT you accounted for to HMRC. But if you use the flat rate scheme a further adjustment might be needed to your profits. Why and what is it?
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VAT CASES - 05.11.2019

Theft leads to successful bad debt relief claim

The case. Total Catering Equipment Ltd (T) took customer orders for goods over the phone but a dishonest employee arranged for debit card payments to be paid into his personal bank account instead of the business account. When the problem was discovered, T proceeded with its VAT reporting by initially accounting for output tax on the stolen payments but then claiming bad debt relief (BDR) on a subsequent VAT return....
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CREDIT NOTES - 01.10.2019

New rules on credit notes

Since 1 September 2019 you need to be aware of a rule change which affects how you use credit notes to account for price changes. How might the changes affect your business?
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BAD DEBTS - 01.10.2019

How to deal with an unexpected payment of a bad debt

One of our subscribers recently received a part payment from a bankrupt customer. The debt related to supplies made at different VAT rates, and had been written off in the accounts. How should he deal with VAT on the windfall?
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