Public House Wastage on Beer / Charge for food provided on games nights

ritac

Hi There, I posted this question on the old forum, thought I would look back at the answers received when I needed it and lo and behold the forums have changed, I cannot find the old thread now. Can anyone help again please. How do I deal with the wastage of beer caused when cleaning out pipes in a Pub, I know this is a very specific area and must be followed to the letter.

I need to see the client tomorrow and must sort this today. Thanks to anyone who can help:ohmy:

PaulPSB

I'm not aware of a specific rule as all pubs vary and the loss of ale with pipe cleaning etc will often depend on the skill of the cellar manager.
HMRC will just consider trading margins and make comparisons to see if there is any obvious shortfall.
If you're really keen to get things right there is guidance here:

http://www.hmrc.gov.uk/bens/ben09.htm#11

Read the section on pipe cleaning etc. There is also an appendix to help you calculate the amount of beer in the pipes depending on the diameter of the pipes in use. You can then agree with your client the amount of beer lost when cleaning and ask him to record how often the pipes are cleaned. Then make a weekly/monthly adjustment to the trading account figures.

Hope that helps

Paul

ritac

Hi Paul

Sorry I dont think I have explained myself properly, what I want to know is how to post the journal to show the loss of beer due to wastage/cleaning in the accounts. I found the details on tube sizes etc for pipes but I have been round this so many times I have confused myself on how to post the journal.

:crying:

PaulPSB

So Sorry - I have always opened a new sales account and new cost of sales account (Using SAGE or similar)
Just debit the cost of sales account and credit the new sales account with the amount of the loss. Ignore VAT.
This keeps the entries simple and transparent when preparing accounts or explaining to VAT/HMRC people on subsequent complince visits but lets you keep tabs on the losses and in particular an variance in same.

Hope that clarifies

ritac

Thanks Paul, so in effect you are showing the wastage on drips and pipe cleaning, but it cancels itself out. How about when the publican pays flat rate VAT @ 5.5% on turnover, in this case it is just the 5.5% on the actual sales, ignoring the additional wastage amount, is that correct.

:thumbup1:

claudialowe

Unless you are selling the wastage to the local dross and other wasters

Claudia

PaulPSB

ritac wrote: »

Thanks Paul, so in effect you are showing the wastage on drips and pipe cleaning, but it cancels itself out. How about when the publican pays flat rate VAT @ 5.5% on turnover, in this case it is just the 5.5% on the actual sales, ignoring the additional wastage amount, is that correct.

:thumbup1:

Yes :thumbup:

KernowAccountant

andromilon3 said:

Sale of shop. Seller received £8000 for stock, £1000 for fixtures and fittings and £1000 for goodwill. How is the goodwill treated for tax purposes? Advice greatfully received!

You may wish to start your own thread, rather than resurrecting one almost eight years old.

More information is required: are you asking for the treatment in the hands of the vendor or buyer?

Was the vendor and individual, partnership, company or something else? The same information is required in respect of the buyer.

We're the buyer and vendor connected persons?

When did the transaction occur?