Question on sole trader VAT and expenses

F

fmul9798

Guest
Hi,

I have a question regarding VAT on business expenses as sole trader.
I am required to travel to a customer site, and do so using my own vehicle. For income tax purposes, I record mileage and keep all fuel receipts, and then calculate the actual business expense related to each trip to/from the client site.
My questions relate to VAT treatment of this and similar business-related expenses:
- Do I reclaim VAT on the proportion of the fuel receipt related to business travel, or ignore it for VAT purposes and just cost it as an expense for income tax?

- In respect of phone & ESB, if my home is my office, do I reclaim the relevant proportion of VAT from these expenses, or is it only possible to reclaim VAT when 100% of the ESB & phone cost is business-related?

- Similarly, I only carry 1 mobile phone for both business & personal usage. I estimate 70% is business use based on billing detail analysis. Can I reclaim 70% of the VAT on my mobile phone bills?

Thanks for any help you can offer (and of course I'm also contacting revenue)
-fm
 
You may claim any vat portion of a legitimate business expenditure. You are on the right lines of apportioning the bill to business use and then claiming that amount.

You may also be able to claim some monies tax free for working away from your regular base but it is a while since I looked at this so best to look it up on the revenue web site before you do.

The revenue are very good to answer any questions you have dont be afraid to ask them.
 
number7 said:
You may also be able to claim some monies tax free for working away from your regular base but it is a while since I looked at this so best to look it up on the revenue web site before you do.
Click to expand...

If you are a sole trader you can't claim mileage/subsistence for working away from your regular base, these only apply to an employer reimbursing an employee. For a sole trader it has to be based on receipted expenses.

Regards

podowd
http://www.prima.ie
 
number7 said:
The revenue are very good to answer any questions you have dont be afraid to ask them.
Click to expand...

Try ringing them sometime. They have lovely music while on hold. I think I got Vivaldi's entire Four Seasons one time while waiting. :rolleyes:
 
podowd said:
If you are a sole trader you can't claim mileage/subsistence for working away from your regular base, these only apply to an employer reimbursing an employee. For a sole trader it has to be based on receipted expenses.

Regards

podowd
http://www.prima.ie
Click to expand...

Is this correct? From what I thought, you can claim (i.e. tax-deduct) mileage on a receipted basis for travel to and from a (non-base) customer site and you can also claim for sustenance/meals.
 
Re:contacting Revenue, I have found that if you are polite and have a clear list of scenarios/questions to talk through, they are very helpful. I keep notes on the date & time of the call, and the details of the discussions in the event that I am misinformed.

You are indeed entitled to claim for certain travel as a sole trader e.g. receipted petrol with detailed mileage breakdown. As for meals/subsistence, it is my understanding that you are entitled only to claim for overnight meals away from your office - breakfast/lunch cannot be claimed.

And to the original question: Revenue tell me that VAT cannot be claimed back on petrol regardless, nor can it be claimed on food (e.g. for the overnight meals I mention abovE). I then spoke with self-assessment, and they told me that if VAT could not be reclaimed for the petrol used, then I am entitled to include the VAT-inclusive amount as the expense.



Thanks again to all
-fm
 
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