ITAX- tax points

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FrancesM
FrancesM Registered Posts: 14
in AAT Level 3 (Level 6 in Scotland)
The rules seem to be that if you are issuing an invoice to a customer who is not VAT registered then you use the date of supply as the tax point. If the customer is registered then you use the date the invoice is issued.

In the real world how would you know if the customer is VAT registered? For example, i got work done on my car, the garage issued an invoice, the garage wouldn't have known if I was VAT registered or not.

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  • h0llymay
    h0llymay Registered Posts: 24
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    My guess is they'd use the tax point from the date that work was done
  • stevef
    stevef Registered Posts: 258 Dedicated contributor 🦉
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    The tax point is always the date of supply, however sometimes that is not easy to assess. The invoice date serves as a good proxy if the supply date is not certain. You do not need to know if the customer is VAT registered or not, the rule is the same.
  • FrancesM
    FrancesM Registered Posts: 14
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    The tax point is not always the date of supply according to the books. What about the 14 day rule? what about if they customer pays part payment etc? This is very confusing
  • h0llymay
    h0llymay Registered Posts: 24
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    The 14 day is if a customer were to collect the goods. The invoice is usually raised within 14 days of the supply. If the invoice is raised before the physical supply then the tax point will be the date of the invoice though in my company we're not actually supposed to invoice until we have supplied the goods unless we have the items and they don't want it in which case we bill and hold. The more you go over it the more it will start to make sense and stick into your head! Working in a manufacturing business has helped me learn these as I have came across all sorts of situations which gave me the experience :)

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