VAT on recharges from the US

Lucy_M Registered Posts: 136 🎆 🐘 🎆
I have a client who has expenses from a trip overseas and wants to recharge his client, they are fro his hotel, food and car hire. If it was the UK I would advise that he adds VAT to any net transactions and charges the ones with VAT at net with the VAT incurred shown, but I'm not 100% sure about expenses from the US. Should he add VAT to them as the client paying is in the UK?
Any advice much appreciated thank you!
Lucy :)


  • TreadStone
    TreadStone AAT Licensed Accountant Posts: 280 💫 🐯 💫
    As they are recharges and not disbursements I would add the £ equivalent and add VAT.
  • Lucy_M
    Lucy_M Registered Posts: 136 🎆 🐘 🎆
    Thank you, that was my thought but my clients customer is saying no so I wanted confirmation before I stamped my feet.. ;)
  • MarieNoelle
    MarieNoelle Moderator, MAAT, AAT Licensed Accountant Posts: 1,369
    edited March 2016
    Whatever has been agreed between your client and your customer is to be taken into account. You client can recharge what he wants (a flat fee, actual expenses etc...) but the recharge is subject to VAT. If the agreement is that your client is not out of pocket then he has to recharge the full amount of U.S. Expenses as he can not reclaim any VAT on these.
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