News posted by Clear Books Employee 6 years ago
We would like to announce the launch of VAT exempt status for Invoice and Bill creation. This improvement will allow for more fine VAT status control and to make clearer the status of VAT on an invoice. We hope this helps and stand committed to improving Clear Books as much as we possibly can for all our customers.
All the best,
Hi Mohamed,
Would you be able to point me in the direction of broader explanation of when one or another of these should be applied? For instance what is the difference between Exempt and Exclude?
Cheers
Sam
Hi Sam,
It would depend on the goods sold. Some goods are classed as exempt and sometimes the sale is simply not taxable and excluded from VAT. I would not be able to provide a list of which are which as this is very comprehensive I'm afraid. To put that in a little more perspective VAT on purchases incurred that relate to the supply of exempt supplies, in general, are not reclaimable. This is known as exempt input tax. However, provided the amount of exempt input tax is below a certain amount, it can be recovered in full. In contrast, where you sell or otherwise supply zero-rated goods or services - here you can reclaim the VAT on any purchases that relate to those sales. I would advise perhaps speaking to an accountant to understand this in the context of your situation a little bit better.
All the best,
Mohamed.
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