glyn edwards aiit vat consultant. question: what makes lap-dancing clubs interesting?...
Post on 15-Dec-2015
216 Views
Preview:
TRANSCRIPT
The Tri-Partite Relationship
The Club Customers
Dancers
Door fee & bar
Cash for Chips
Chips or cash for dances/ ‘sit-downs’
Chips for Cash
Licence Payment
3
‘Services to the Salon’ Structure
Hair Salon Customer
Stylist
Supply (say £100k p.a.)
Subcontract or employee
(say £50k)
Lost VAT £14k
4
‘Services to the Customer’ Structure
Hair Salon Customer
Stylists
Chair Rent/Use of Facilities
(£50k)Supply (£50k)
5
Taxi Firm as Principal
Taxi Firm Customer
Taxi Driver
Supply (say £100k p.a.)
Subcontract or employee
(say £50k)
Lost VAT £14k
6
The Taxi Firm as Agent & Principal
Taxi Firm
Private Customers
Driver
Radio Rental & Commission
(£50k)
Cash
Business Customers
Account
Driving Services
8
Agency is most effective when…..
Customers are unable to reclaim VAT
Contractors are operating below Registration threshold
BUT – Customs hate any VAT-saving device and regard agency as a risk to the revenue
9
Agency – Getting It Right
1. Always have written agreements
2. The principal must be know the value of their supply and the amount of any commission
3. Negotiation – this is key in the Spearmint Rhino decision
4. Control – the principal must be able to control his business as far as possible
10
Other Examples of Agency
Staff agencies – where customer cannot claim VAT e.g. health, banking
Massage parlours
Education – to benefit from the exemption for individual teachers
11
Typical Arrangements
Staff Agency Hospital/Care Home
Self-employed Doctor/Nurse/Auxillary
Invoice incl m/up
Invoice
Past treatment: VAT exempt either as:
1. Services of a medical practitioner/registered nurse
2. Care in an approved institution
13
Is It Right?
Staff Agency New housebuilder
Self-employed Bricklayer
Invoice incl m/up
Invoice
The supply from the agency to the new house builder is a supply of staff: VATable irrespective of the what work the bricklayer performs
Instruction & Control
14
What Has Changed?
University of Glasgow NHS trusts
Consultants
(Medical Lecturers)
Invoice incl m/up
Tribunal found that this was a taxable supply of staff!!
Instruction & Control
15
The “Misdirection” Concession
If a Customs and Excise officer, with the full facts before him, has given a clear and unequivocal ruling on VAT in writing or, knowing the full facts, has misled a registered person to his detriment, any assessment of VAT due will be based on the correct ruling from the date the error was brought to the registered person's attention.
16
The “Misunderstanding” Concession
VAT undercharged by a registered trader on account of a bona fide misunderstanding may be remitted provided
(a) the tax has not been knowingly evaded;(b) there is no evidence of negligence;(c) the misunderstanding does not concern an aspect of the tax clearly covered in the guidance published by Customs and(d) the tax due was not charged, could not now be
expected to be charged to customers, and will not be charged.
17
top related