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VAT Treatment on Re-Worked Goods

Posted Tue, 31 Oct 2023 12:05:41 GMT by
Hi, We have supplied goods to a customer who has had to re-work them (adding their own products/time). They are now asking us to pay an amount to them for the cost of the re-working. Would this amount that we pay be subject to VAT? If yes, can we just issue a credit note for the amount requested against the original sales invoice (which was Vatable). Thanks
HMRC Admin 20
Posted Wed, 01 Nov 2023 15:19:20 GMT by HMRC Admin 20
Hi JP1855GRLM,
If you are offering a reduction in price for the goods supplied please see the information below:
VAT guide (VAT Notice 700) 18. Credits and debts
Thank you.

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