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Posted Fri, 24 Mar 2023 19:04:22 GMT by Philip Burling
In February 2022 I hired an art director for several hours to help me scope a project and give advice on hiring artists. Apparently given that he was within the EU (based in Austria), and that my limited company was based in the UK, and that it was a B2B transaction meant that he didn't need to charge me VAT. I gave him my company number for the invoice, but I used my personal bank account to pay for it as I hadn't set one up for my limited company yet - and it wouldn't have had any money in it anyway as it hasn't sold anything yet. The limited company company I had set up still has had no income yet, and therefore can't pay back to my personal bank account. I'm unsure whether I've made a mistake here using my personal bank account to pay, and what I can do to remedy it. I'm also unsure how I'm meant to log this in my company records, or in my company accounts submitted to Companies House, or on my corporate tax return. 1. Does this count as a trade? 2. As I used my personal account, does this count as a company expenditure/loss or not? 3. If not, do I somehow need to pay this VAT after all? 4. Does it count as a debt instead of an expenditure, and what is the correct way to record or submit this on these 3 documents? In November 2022 I paid for a product from a person based in the USA, and I did pay for the VAT, also using my personal account, but using my limited company's name. 5. Should I have paid this VAT? 6. How would I reclaim it if not? 7. Similar to the above questions... How does the fact I used my personal account affect my record-keeping, company accounts that I submit, and corporate tax return? Is this recorded as a debt to me personally, or a loss/expenditure? Please help. Thanks Phil
Posted Mon, 27 Mar 2023 14:28:21 GMT by HMRC Admin 17

If you are hiring an artist director who is giving you advice and they are based overseas then this would normally
be treated under the reverse charge procedure and so VAT would be accounted for by you,the customer.

This prevents the overseas supplier from having to charge the VAT to you. 

If the supplier hasn't accounted for this correctly then I would speak with them as you're not allowed to recover VAT as input tax
where it has been incorrectly charged.

Please see the folllowing guidance :

Place of supply of services (VAT Notice 741A)    .


I would recommend speaking to our Corporation Tax Department on 03002003840
to discuss any consequences of paying from your private  account  .

I would also speak with Companies House regarding this matter .

Thank you.


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