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VAT fraction
15 December 2009

  Following the temporary change in the VAT percentage, there was a consequent change in the VAT fraction (used to calculate nett values).

As many organisations may have to apply VAT at 15% or 17.5% within the current financial year, here's a reminder of the relevant VAT fractions:

For 15%, the fraction is 3/23

For 17.5%, the fraction is 7/47

Working at home
22 May 2008

  If you work from home, you are entitled to tax relief against certain expenses that you would not incur otherwise.

Where these expenses are considerable, supporting evidence will be needed. However, a flat rate allowance of 3 per week is now available for every week that you work from home in the tax year 2008-2009. This is an increase on previous years - which was 2 per week.

Your employer can therefore contribute to your extra household expenses and there is no tax or national insurance liability, but nothing can be claimed if no payment is made by the employer.

VAT receipts for private fuel
1 February 2006

  The rules for claiming input VAT on fuel for business use have changed subtly from 1st January 2006.

As before, where an employee buys the fuel for a vehicle and uses that vehicle for company business (excluding travelling to and from work), the employer may claim the VAT back on the fuel element of any business expenses reimbursed. This has not changed.

However, in support of their claim, the employer must be able to produce VAT invoices for the fuel bought. These do not have to be fully detailed VAT invoices, but they will act as proof of purchase provided that the total of all invoices is at least equal to the cost of the fuel used for business. (The total may, of course, exceed this amount).

Zero rated or exempt VAT?
16 July 2003

  Does your accounting system know the difference between goods or services that are zero rated for VAT purposes - as opposed to exempt from VAT?

It may not seem to matter, since the calculated VAT is zero in both cases - but this could change in the future. Last year, the media were discussing the implications of putting VAT on newspapers and books - this year it's children's clothes.

With suggestions that the EU wants to harmonise taxes between member countries, now's the time to check that you have the correct VAT code against your products on your computer system.

Try this little test - which 2 of the following are exempt from VAT?

Insurance; external training courses run by a limited company; sewerage services; tea bags; courses run by non-profit making educational establishments; chocolate covered biscuits; electricity

Members can log in to find the answer.

The VAT Guide book or the Customs & Excise web site are both useful places to obtain a detailed list of zero rated and exempt items.

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Ultralogic Solutions Limited, Point South, Park Plaza, Hayes Way, CANNOCK, Staffordshire, WS12 2DB
Tel: 01543 496885