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Vat

sscorssscors Feels At HomeRegistered Posts: 72
Hi

not quite sure why purchases and creditors are £470 and not £400

A business makes sales on credit of £1000 plus VAT and purchases on credit of £400 plus VAT. How would these be accounted for if the sales are exempt activities, whereas the purchases were std rated

Any help would be much appreciated

Comments

  • coojeecoojee Experienced Mentor Registered Posts: 794
    Because if sales are exempt you can't reclaim the VAT on the purchases.
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