.png)
.png)
29 March 2011
A company paid £10,000 in cash for building work, presumably to avoid a ‘VAT surcharge’ for a non-cash payment. The builder has now settled outstanding VAT liabilities with HMRC and the company wishes to recover the VAT element
Last year a company client incurred some building works for its business and paid £10 000 in cash. Although the client was not offered an alternative price for payment by cheque with hindsight the director accepts that there was probably a ‘VAT surcharge’ for a non-cash payment.
Soon afterwards I discussed this with the director who latterly realised that because the company was VAT registered it really would not have mattered had he paid the VAT as it could all have been recovered.
This was brought back to mind because the director has heard on the grapevine that the builder has been investigated by HMRC and has settled his VAT liabilities in full. This means that my client’s £10 000 payment has now been accounted for as approximately £8 500 plus £1 500 VAT.
Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.
