- This topic has 2 replies, 2 voices, and was last updated 10 months ago by
.
- Posts
Standard rated materials amounted to £32,400, of which £600 were taken by the sole trader for personal use.
I think the input vat would be 6360 i.e. after deducting 600 from 32400 and then calculating input vat. but in the technical article value added tax part 1 example 12 the input vat has been calculated as 6480 i.e. calculating 20% on 32400 without deducting 600.
Why is it so Is it incorrectBoth your answer and the one shown in the article are correct – they are just alternative ways of getting the same outcome!
You have done what I would also have done and simply treated the input tax on the private use purchase as irrecoverable and therefore got net input VAT recovered as £6,360 whereas the answer has firstly shown input tax on the full purchases as £6,480 and then shown output tax of £120 (600 x 20%) and therefore also has net input tax of £6,360 (6480 – 120).
- You must be logged in to reply to this topic.