vat flat rate calculation help

broadpaws

Hello Team,

I am due to do a vat return and just want to make sure I am working out the amount I have to pay correctly - I am on the flat rate scheme at 11% so can someone just check I am working the percentage out right?

ok - basically I pay vat at 11% on my turnover:

So I thought it would be a simple

52100.76 (turnover) X11% = 5731.08 (vat due)

HOWEVER - my colleague says the calculation should be

52100.76 DIVIDE by 1.11 - that then gives 46937 and the difference bewteen the two is the vat owed (5163.76)

Who's right??

classy69

Hi,


Your colleague is wrong!


Your method is the correct one.

booksurr

as classy69 says

http://www.hmrc.gov.uk/vat/managing/returns-accounts/flat-rate-returns.htm

"Calculating your Flat Rate Scheme turnover
you normally apply a single percentage, based on your business activity, to your total flat rate turnover in a VAT period, and the result is the VAT you pay.

Your flat rate turnover is all the income you receive, including VAT"

broadpaws

reply thank you both

TheCyclingProgrammer

Yes, as above, do make sure you calculate your flat rate VAT on your turnover including VAT, not excluding it! A common error. Your flat-rate turnover should also include the value of any zero-rated or exempt supplies (but not supplies outside the scope of UK VAT).

You might want to get your colleague to check his VAT return calculations too.