VAT on training services

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Barney77

Guest
I am a sole trader providing management consultancy services. I am doing a project with a client which includes some training - e.g. 20 days consultancy and 10 days training.

I am registered for VAT. Do I need to charge VAT on the training days? Does training need to be on a separate invoice? Are there any conditions - registration etc, before I can designate these training days as training?
 
Check out vocational training (VAT exempt). There are conditions for it to be VAT exempt - basically it must be carries on in a class room evnviroment etc. If your client is VAT registered I wouldnt be overly worried about getting yourself into the VAT exempt box as the VAT will effectively be no cost to him/her
 
Following on from CXC's point regarding the fact that the VAT would not be a cost to your VAT-registered client, if you were to go down the road of providing VAT-exempt supplies, you would end up having to make an adjustment on your own VAT input credits...

e.g. say 20% of your turnover related to VAT-exempt training, and therefore 80% of your turnover was derived from VATable supplies; then you would only be entitled to an input credit for the 80% of your overheads (e.g. light/heat, phone, motor etc...) that relate to the taxable activity.

As you can see, it all gets very messy very quickly, so you will be much better off deciding that the type of training services you are providing are not "Vocational training", and just invoice the VAT...
 
What type of specific training is it?
Based on VAT Legislation, most training is exempt, but do not assume your service is.

as stated above, if you have VAT exempt services, then any input costs relating (directly and/or proportionally) to the exempt service cannot be claimed in your VAT return.

As also suggested, 1 invoice.....hmmm...what happens if someone from Revenue looks at this.....agree its the most straightforward......so that is why need to find out exactly the type of training
 
Per Revenue guide to rates of VAT, "Vocational Training" is... "Exempt if provided to students to improve ability to carry out work or to obtain employment, and if provided in a 'classroom' setting, a pupil-teacher relationship exists, and a recognisable standard of skill is achieved."

You haven't said what it is you'll be doing but if you aren't doing it as described above, and you invoice with VAT, I don't envisage you having any problems.

Anyone agree / disagree..?
 
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