Reclaiming VAT - help

iamdark1988

Hi,

I am currently reviewing last months petty cash receipts to process on Xero and I've noticed a few receipts have an asterisk against various items.

Upon reviewing various Google search results, it means these items are inclusive of VAT. However further research has brought two conflicting answers as to whether or not the Limited company I work for can reclaim the VAT.

Answer 1

It's advisable not to reclaim VAT if a receipt is obtained but only showing a VAT number and asterisks. This is due to a VAT inspector would need to see the VAT breakdown of the items from the supplier directly. Therefore process all receipts on Xero as the No VAT rate.

Answer 2

VAT can be reclaimed on these receipts as long as it shows various information eg. the name of the supplier, address, VAT registration number, gross amount etc. However when these receipts are processed on Xero, any items without an asterisk would obviously need to be processed as at the No VAT rate.

In the future I'll make sure my colleagues obtain VAT receipts if applicable!

Thanks in advanced for any help. Also apologies is this in the wrong category or has been answered before.