Jay Cooke

There is nothing in the law on this, most suppliers have brains and can figure this out but you can't legislate for stupidity. If the supplier has asked their accountant then the reply about disbursements is irrelevant, accountant hasn't understood the question asked or supplier has not explained the question properly, this was never a question of disbursements (it is not a disbursement). This is just a simple situation whereby supplier buys goods for £100 + £20 VAT, supplier reclaims the £20 VAT, supplier then recharges the goods on for £100 + £20 VAT, no mark-up or profit earned on this transaction but VAT fully charged, supplier is complying with the VAT rules, customer acquires the goods without mar-up from supplier, everyone wins. The supplier is of course allowed to add a mark-up for their troubles and it might be that the supplier is doing exactly that, adding a 20% mark-up, if so, maybe buy the goods directly and not via the supplier. Only solution, if common sense is not prevailing, is to not use them again and explain to them they are marking up all their prices that makes them too expensive to deal with.

It is unsporting when recharging a cost, to charge the gross plus VAT. As CraigF has stated, if the supplier is able to reclaim the VAT on the costs/general expenses they buy in, when recharging onto the customer the supplier should simply recharge the net amounts of those expenses plus VAT, that way the customer is paying the same amount as if the customer had paid for these expenses themselves. However, there is nothing in the legislation that compels a supplier to recharge net plus VAT (although it is good practice), the supplier can add a mark-up if they want to, depends on the contract T&Cs, but in my experience, a phone call to the supplier to explain that by charging VAT on top of the gross, means the supplier benefits/makes an unintentional mark-up/profit and that you as the customer lose out, usually the supplier will reissue the invoice as there is no loss to them, especially if you have an ongoing relationship with them.

https://www.gov.uk/government/publications/revenue-and-customs-brief-7-2021-vat-liability-of-charging-of-electric-vehicles/revenue-and-customs-brief-7-2021-vat-liability-of-charging-of-electric-vehicles Why are EV drivers unable to obtain a receipt? When I charge my car at a public charger, I can get a receipt. Different charger networks have different rules. It should be much easier than it currently is but I guess the EV network is still in the developing stage.....try getting a VAT receipt from Amazon, just as painful but an email order confirmation is not a VAT invoice, you have to go into your order and request a VAT invoice, etc.

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No need to worry, when paying by direct debit, HMRC will check that on the 7th of the month that i) you've filed your return on or before the 7th and ii) that you've an active direct debit setup. If that is the case, HMRC will request funds around 3-4 days AFTER the 7th deadline (depending upon weekend/bank holiday). Your payment is not late and there is no penalty. It's not 5 days late, it is three working days later. Link here https://www.gov.uk/pay-vat/direct-debit "Once you’ve set up the Direct Debit, payments will be collected automatically from your bank account 3 working days after the payment deadline on your VAT return. If you file your VAT return late, your payment will be taken 3 days after you file the return."

You need to read this HMRC Notice https://www.gov.uk/guidance/opting-to-tax-land-and-buildings-notice-742a You cannot charge VAT on rent relating to a commercial property unless you have first notified HMRC in writing (via email). This process is called "opting to tax", this is because commercial rent is not a VATable supply, it is an exempt supply, but you as the property owner have the choice to "opt" to tax the property, whereby you notify your intention to charge VAT on rent and your rent is then standard rated. The right to reclaim VAT is always on the basis the costs you incur (property purchase) are connected to the making of a taxable /VATable supply (the rent is your supply, it is not taxable unless you opt, so without opting, no right to reclaim VAT), so to answer your query, you cannot reclaim any input tax (the £20,000) unless you first opt to tax/notify HMRC. You should read all of the Notice and then speak to your accountant if you have one. Once you have notified your option to tax, it is irrevocable for 20 years, this means all future rents or any future sale will be subject to VAT, even if you try to deregister for VAT within next 20 years, there may likely be an output tax liability due on the market value of the property which you'll have to pay before deregistering (unless you ell the property plus VAT or it meets the sale conditions to be a ToGC), so opting to tax is not something to take lightly or without advice or at least thinking through the numbers first.. If you try and reclaim the £20,000 VAT on your next VAT return, this will likely attract HMRC's attention (HMRC often monitor land registry transactions plus the £20k might be a higher figure than normal for your business and such a spike will trigger HMRC to query the return) and when HMRC enquire as to why the refund is so high, you will tell them you bought a property to rent out, HMRC will then ask for your option to tax notification, you will not have that and HMRC will deny you the refund and potentially issue penalties for trying to reclaim VAT without an option to tax in place. In summary, you can reclaim the VAT if you opt to tax, but ensure you understand all the implications of opting to tax. If you don't opt to tax, you cannot reclaim the input tax on the property purchase.