VAT for invoice for December 2009

[dollybird66]

Hi, just a quick question.

I am just about to invoice for work done in December 2009. Do I invoice it at the rate of 15% since it relates to December. Even though it won't be sent until 4th January 2010 and will be dated 4th January 2010?

Someone please confirm.

[NetConneXions]

I believe that if the work was done in December, then it should be decembers VAT rate of 15%.

[selfeax]

Hi Dollybird,

Provided the work you are about to invoice for was completed before the 1st January, you can choose to account for VAT at 15%.

Regards,

[UKSBD]

Hope you're getting some correct advice or you might be joining me in Siberia,
http://www.ukbusinessforums.co.uk/forums/showthread.php?t=138059
:)

[selfeax]

I am no VAT expert and I am sure one would come along and correct me but from a technical point of view, the basic tax point would be the date of delivery of the goods or services which would have been in December. However, if the invoice raised on the 4th of January was/is raised within 14 days of the basic tax point, then the basic tax point gets overwritten and the date of the invoice (actual tax point) is the tax date.

However, HMRC have issued this guidance under the section "Sales that span the change in rate" which allows businesses to account for VAT at 15% on a VAT invoice raised after the 1st of January, for goods/services provided before this date- please see link below

http://www.hmrc.gov.uk/vat/forms-rates/rates/rate-changes.htm

Regards,

Maryann

[David Griffiths]

If the work was complete by 31 December you can charge 15% VAT

If the work was ongoing at 31 December, you can charge 15% VAT on work done by that date and 17.5% on the work done afterwards. HMRC won't challenge any reasonable basis of apportionment

Of course if your customer is VAT registered, then it doesn't matter. :)