Claiming VAT on a mobile phone

Discussion in 'Accounts & Finance' started by Alan @ Clyde Resources, Apr 16, 2009.

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  1. Alan @ Clyde Resources

    Alan @ Clyde Resources UKBF Newcomer Free Member

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    Hi there

    I am a new Limited company and about to post my first VAT return.

    To keep costs down when I started up I used my personal mobile phone for business. Therefore it is used for both personal / business calls.

    Am I allowed to claim VAT back on all calls. Business Calls or No calls.

    I am on a monthly contract and very rarely go over my usage.

    I look forward to your comments.
     
    Posted: Apr 16, 2009 By: Alan @ Clyde Resources Member since: Dec 21, 2008
    #1
  2. Fernhurst Solutions Ltd

    Fernhurst Solutions Ltd UKBF Newcomer Full Member

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    Hiya Alan

    You can claim the VAT on your business calls only ... hope that helps.

    PS - have you got an Accountant for your Year End Accounts, Corporation Tax, etc?
     
    Posted: Apr 16, 2009 By: Fernhurst Solutions Ltd Member since: Jul 18, 2007
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  3. David Griffiths

    David Griffiths UKBF Legend Full Member - Verified Business

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    Have to disagree with that, sorry.

    If the phone is in the personal name of the director, I don't see how the company can reclaim the VAT - it won't have a valid VAT invoice.

    If the company pays the phone bill, then the payments should be included in your pay for the year, and full Class 1 employer's and employee's National Insurance accounted for. It also goes on the P11D so that tax can be assessed separately.
     
    Posted: Apr 16, 2009 By: David Griffiths Member since: Jun 21, 2008
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  4. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

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    The best thing to do would be to get the bills made out to the company ie in the company name and then you can claim all of the VAT and their is no benefit in kind.
     
    Posted: Apr 16, 2009 By: MyAccountantOnline Member since: Sep 24, 2008
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  5. CassioAcc

    CassioAcc UKBF Newcomer Free Member

    960 237
    If the company is paying the business calls only then you can claim the appropriate element of VAT but HMRC may disallow it as the invoice is not in the company name.

    I see you are on a fixed bill. As the business calls do not incur any additional cost you cannot claim anything.
     
    Posted: Apr 16, 2009 By: CassioAcc Member since: Mar 17, 2008
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  6. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

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    I disagree - as these bills are not made out to the VAT registered person ie the company then the company can not claim any VAT.
     
    Posted: Apr 16, 2009 By: MyAccountantOnline Member since: Sep 24, 2008
    #6
  7. David Griffiths

    David Griffiths UKBF Legend Full Member - Verified Business

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    Quite correct!
     
    Posted: Apr 16, 2009 By: David Griffiths Member since: Jun 21, 2008
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  8. Mattonella Tile Studio

    Mattonella Tile Studio UKBF Ace Free Member

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    When I did the bookkeeping course they taught that for petty cash expenses where a member of staff was claiming something back, if a VAT receipt was submitted, to separate it out and claim the VAT in the VAT account.
     
    Posted: Apr 16, 2009 By: Mattonella Tile Studio Member since: Jun 10, 2008
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  9. David Griffiths

    David Griffiths UKBF Legend Full Member - Verified Business

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    You might get away with that in the case of typical retail receipts, where there is no customer name, but it simply won't wash with a mobile phone bill which is clearly not in the company name.
     
    Posted: Apr 16, 2009 By: David Griffiths Member since: Jun 21, 2008
    #9
  10. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

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    You might be thinking of subsistence and mileage which is different but in this case as it is a phone bill unless the bill is in the company name VAT shouldnt be recovered.
     
    Posted: Apr 16, 2009 By: MyAccountantOnline Member since: Sep 24, 2008
    #10
  11. KM-Tiger

    KM-Tiger UKBF Legend Full Member - Verified Business

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    I'm sure the accountants are technically correct, but in practice I've reclaimed VAT on personal mobile bills for years, and never had that picked up on VAT inspections.

    Not suggesting you follow suit, but might be worth a try until such time as you can change the invoice name to the company.

    The risk would be having to repay it if challenged.
     
    Posted: Apr 16, 2009 By: KM-Tiger Member since: Aug 10, 2003
    #11
  12. David Griffiths

    David Griffiths UKBF Legend Full Member - Verified Business

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    Why not go the whole hog and claim for your home grocery bills? After all it might be worth a try, and the risk would be vaing to repay it if challenged. :rolleyes:
     
    Posted: Apr 16, 2009 By: David Griffiths Member since: Jun 21, 2008
    #12
  13. RAL

    RAL UKBF Enthusiast Free Member

    723 177
    Let alone vat, I am afraid you can not claim the cost of the mobile calls either (You can not apportioned fixed contract as personal and business). HMRC says, if you go over the limit and use your mobile for the business usages and incurred any charges, then you can claim.

    It is worrying to see that eagerness to recommend you to go to see an accountant and we as an accountant get it wrong.
     
    Posted: Apr 16, 2009 By: RAL Member since: Aug 31, 2008
    #13
  14. KM-Tiger

    KM-Tiger UKBF Legend Full Member - Verified Business

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    Not much VAT on those! Though watch for those items with a * on the till receipt.

    And there would be clear intent to defraud, which is not the case with a mobile used mainly for business, where the technicality is merely the name on the invoice, not the intended use.

    BTW: Is there VAT on envelopes? I used a business one for a personal letter the other day.
     
    Posted: Apr 16, 2009 By: KM-Tiger Member since: Aug 10, 2003
    #14
  15. elainec100@cheapaccounting

    [email protected] UKBF Newcomer Full Member

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    oh dear - I best get off and go and put David's toys back in his pram :):D
     
    Posted: Apr 16, 2009 By: [email protected] Member since: Nov 4, 2005
    #15
  16. David Griffiths

    David Griffiths UKBF Legend Full Member - Verified Business

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    The point that I'm making is that you are claiming for something that you actually know isn't claimable.

    And of course the VAT on the grocery bills will depend on how many choccy biscuits you buy! ;) To eat while you're working obviously.
     
    Posted: Apr 16, 2009 By: David Griffiths Member since: Jun 21, 2008
    #16
  17. elainec100@cheapaccounting

    [email protected] UKBF Newcomer Full Member

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    Bets thing that the op can do is put the mobile in the name of the limited company then total cost can be claimed - business and personal
     
    Posted: Apr 16, 2009 By: [email protected] Member since: Nov 4, 2005
    #17
  18. KM-Tiger

    KM-Tiger UKBF Legend Full Member - Verified Business

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    I would regard it as a grey area, and morally defensible, even if not compliant to the letter of the law.

    To take another example:

    I buy something on line for my business and use my personal credit card. The invoice I print out from the website has my name on it.

    Reclaim the VAT?
     
    Posted: Apr 16, 2009 By: KM-Tiger Member since: Aug 10, 2003
    #18
  19. elainec100@cheapaccounting

    [email protected] UKBF Newcomer Full Member

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    Do you think HMRC give a damn about morals? :|:rolleyes:
     
    Posted: Apr 16, 2009 By: [email protected] Member since: Nov 4, 2005
    #19
  20. Gillie

    Gillie UKBF Legend Full Member - Verified Business

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    Ok well what about this one then ... I have had a contract with voda on a personal level forever and a day and last year I also took out a business contract with them for two phones, however, the way that voda works, is that they associate all of the phones under one main contract ie my original personal one and send one bill, which does have pages for each phone, but although the one for the new two are in my name, they do have voda business on them ... now voda won't change the phones into a business name unless I take out a completely new contract for two new phones .. phew!

    So yes, I or him that does, claims vat back on the two business phones!
     
    Posted: Apr 16, 2009 By: Gillie Member since: Apr 12, 2006
    #20
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