Urgent VAT question

[MarkoTVR]

This is last minute, but if anyone can answer this for me tonight (23/04), that would be great! (I can phone by accountant tomorrow to check this, but finding out tonight would be easier).

Last year I was contracted to a company who paid my expenses (meals, hotel, petrol, etc.) but I (as in my limited company's credit card!!) had to pay for everything first and then claim it back from them. This was done by creating an invoice for the amount of expenses incurred that month, which was sent in and processed in the same way as invoices for my services. As per my service invoices, I had to identify the net amount and the VAT on the expenses invoices.

I am on the Flat Rate VAT scheme at 13%.

My question is......do I have to pay 13% on the total of just my services invoices, or do I need to include my expense invoices too (i.e. so I pay 13% on EVERYTHING that came into the company, even though the exact amount that came in for expenses was to make up for what was paid out in the first place)?
I'm guessing it's the latter, as I'm sure my accountant said so, but I'd like to confirm tonight thanks to my useless memory for important things letting me down.

Cheers!

[Smartie]

yep, on everything.

You charge them the total cost of your services and your expenses and add VAT to this total.

In normal cases you could then reclaim VAT on the cost of these expenses (fuel, hotels, etc), however on the flat rate scheme this isn't the case.

Sorry!

[MarkoTVR]

Thanks Smartie! Well, I think so anyway! Time to write a fat cheque and then cry into a coffee......

[Eric Mc]

Yes. once you are registered for VAT you MUST charge the appropriate VAT on whatever you charge your customers. It doesn't matter if the invoice you raised was for your services or to cover your expenses.

Your customers should have been requesting VAT invoices from you anyway!!!