Differences

This shows you the differences between two versions of the page.

--- finances:vat [2026/05/13 11:07] – root
+++ finances:vat [2026/05/13 11:26] (current) – root
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 ===== VAT on Income =====
+VAT is automatically taken off any income we make from the Guild website before it hits the account. This means that when memberships are sold on the website for £5, our current account will be credited with £4.17.
+This also applies to any ticket or merch sales we make on the website. It also applies to cash sales except in these cases it's on the committee to properly declare what the cash is from so that the VAT is taken properly. Falsely declaring ticket income as something else to avoid the VAT is fraud - as tempting as it may be to hold onto those extra couple quid, don't do it. Again, this is automatically taken off the total before it hits the account. So if you pay in £120 in cash and declare it as ticket sales, the amount credited to the account will be £100. You can work this out by dividing your total including VAT by 1.2. So 120 divided by 1.2 = 100.
 ===== VAT on Expenses =====
+The reverse concept applies to expenses as it does for income. That is to say, when we buy something that has VAT on, the Guild pays that for us.
+You can use the same calculation as the income section. So if the total cost of something is £120 including VAT, divide that by 1.2 giving £100 which is the amount the society will actually have taken out of the account.
+To make sure the Guild do this, you need to make sure you have a valid VAT receipt or invoice for the expense. If you don't, they pay it for you and the society account will be charged the full amount. Depending on the total of the expense they might catch this for you and ask you for a VAT receipt or invoice, but they also might not so it's important to keep an eye on the statements and make sure that it lines up with what we expect. If you notice that an expense has been processed and we've been charged the full amount and you expected VAT to be taken off then you need to query this with the coordinator as there might be a reason you haven't realised. If it's simply a lack of a VAT invoice or receipt you can get this from the supplier, give it to the Guild, and they can retrospectively give you the VAT money back. An extra safeguard here is including that you expect it to have VAT taken off in the supporting information of the expense. When you do this, it should prompt the Guild to actually check, and query it if they don't think they can take VAT off.