Safety Boots/Shoes - VAT

TwistedSpirit

Good Morning

I have a query about the VAT on safety boots and shoes. I have a tendency to waffle but I will get to the point.

Safety Boots are Zero Rated and if purchased for yourself have no VAT
Safety Boots purchased by an employer for staff results in VAT being paid and reclaimed.

Safety Shoes are classed as a luxury and thus when purchased for yourself have added VAT.
Can an employer reclaim VAT on safety shoes?

As a manufacturing company we supply safety boots up to the value of £20.00 for our employees.
If the employee wants more expensive boots/shoes we will give them £20.00 towards them.

What is the VAT situation when we are reclaiming part costs from the employee?

I hope this makes sense as to what I am asking?

Thanks in advance

TS

TwistedSpirit

I have been looking at this again I think it stems to whether we contribute £20.00 +VAT or £20.00 including VAT.

If an employee bought their own for £20.00 they would get £20.00 back which is exclusive of VAT.
If we bought them the £20.00 boots would be £24.00 including VAT.
Therefore our £20.00 would be £16.67 and £3.33 leaving £4.00 on the boots.

Am I right in thinking that as Boots are Zero rated for the employee they would pay £3.33 towards these boots?

£16.67 Employer contribution
£3.33 Employee contribution
£3.33 Reclaimable VAT
£23.33 Total
+ £0.67 that shouldn't be charged to employee

If we contributed £20.00 +VAT
£20.00 Employer Contribution
£4.00 Reclaimable VAT
£24.00 Total

As I said I have a tendency to waffle so I hope you can follow my workings.

Thanks

TS