Commentary

V7.363 Partial exemption special methods/non-business VAT (1 January 2011)

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.363 Partial exemption special methods/non-business VAT (1 January 2011)

Part V7 Tax planning | Commentary

V7.363 Partial exemption special methods/non-business VAT (1 January 2011)

When deciding how much input tax can be claimed by a business on an expense, there is a two-stage process to carry out:

  1.  

    •     identify the proportion of the expense that relates to business use (this can be done using any method that is fair and reasonable), and

  2.  

    •     identify (and not claim) any of the remaining VAT (after the previous stage has been carried out) that needs to be blocked to reflect exempt use, ie taking into account the principles of partial exemption

Until 1 January 2011, any partial exemption special

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