1. VAT Presentation to FASIG Liz Shillingford - VAT Accountant 18 March 2008

2. Presentation objectives Explain VAT codes on Aptos Explain partial exemption Sales & Purchases - common problems Increase overall general awareness Increase accuracy of coding on invoices

3. VAT codes on Aptos (Tax specifications) For Sales ST - Standard rate ZE - Zero rated EX - Exempt OS - Outside the scope of VAT Taxable supplies Non taxable supplies

4. Type of supply determines VAT treatment of expenditure Taxable supply = VAT fully recoverable Non taxable supply= VAT not recoverable Mixed supply = VAT partially recoverable

5. VAT codes on Aptos (Tax specifications) For purchases SR - Standard rate, fully recoverable SN - Standard rate, non recoverable SP - Standard rate, partially recoverable You should only see one of these per account code Determined by supply made/income source

6. VAT codes on Aptos (Tax specifications) For purchases ZE - Zero rated EX - Exempt OS - Outside the scope End result is the same - no VAT but they are not the same

7. What is partial exemption? The University is partially exempt because it makes both taxable and exempt supplies It can claim a proportion of the VAT incurred on mixed supplies University has an income based method Taxable sales = percentage recoverable Total sales Percentage applied to partially recoverable VAT

8. Facts & figures 2006/07 Amount of partially recoverable VAT recorded with SP was £4,246,360 Actual amount we recovered was £630,328 The amount of VAT paid to HMRC through our VAT returns over the last 5 years has been £2,342,645 That’s an average of £468,529 per year or £117,132 per quarter

9. Sales – common problems Ensure correct VAT code is used Internal sales are outside the scope of VAT (with the exception of liquor sales – HS only) If there is no supply then no VAT should be charged, e.g. recovery of expenses or grant income See separate handout on VAT and Sales

10. Purchases - common problems VAT inclusive invoices – VAT must be split out – VAT fraction is 7/47 of total amount Mixed supply invoices – Enter a separate line for each change in tax rate – Do not enter total amount using OS and ignore the VAT completely

11. Purchases cont’d VAT only invoices – Ensure VAT is entered in VAT box –Dummy lines will have to be used to enter a line with VAT and credit line without VAT. Credit line should be OS Internal purchases are outside the scope of VAT (incl B&E invoices which show VAT) See separate handout on VAT and Purchases

12. Purchases from outside the UK Ensure you give our VAT number to avoid being charged foreign VAT that we cannot recover Liable for UK VAT Our VAT number is GB 142 0477 95 See separate handout on VAT and Purchases from outside the UK

13. Getting it right & why it matters Correct coding of purchases will allow more VAT to be recovered Correct coding of supplies will increase taxable sales Increased taxable sales = larger partialrecovery percentage Larger percentage = more VAT claimed back

14. Further information Further information can be obtained from: Liz Shillingford Email:E.E.Shillingford@exeter.ac.ukE.E.Shillingford@exeter.ac.uk Tel:extn 3098 VAT Handouts – available on Finances Services, VAT web page HM Revenue & Customs website: www.hmrc.gov.uk