Tax Point - hotel receipt, paid in advance

Hello All,

a small bit of advice regarding the date a transaction occurs/receipt date and VAT.

I booked and paid for a hotel room via Booking ‘dot’ com. The payment was non-refundable and was taken from my credit card in full on 15/3/19.

The transaction shows up in my bank feed for my credit card but i do not have a VAT receipt for it yet (Total was £245). The payment went to the Hotel, not Booking ‘dot’ com.

I have asked Booking ‘dot’ com for a receipt and also phoned the hotel - they both say that I will get a VAT receipt after I have checked out of the hotel, which will be on May 5th '19. The best the hotel can offer is a proforma invoice, but this will not have the VAT number nor VAT breakdown.

So my question is - if I don’t Tag the payment until I get the receipt (5/5/19) will this have any affect on my 1st quarter VAT return, when the purchase was made?

I think not, assuming the receipt date is the checkout date and not the official Tax Point, which the law seems to suggest is the payment date, then it would get complicated.

I am Cash accounting for VAT.

(it would appear that the law states that the payment date is the Tax Point -
Error in consolidated invoice and system - But then the HMRC website states that -

The date of supply is:

I don’t mind as long as it doesn’t mess with my first VAT return using Quickfile!)

I guess it depends on what the final VAT invoice says, but this HMRC page on advance payments says multiple times that the tax point is the date at which payment is received or the when the invoice is sent, whichever is sooner. So from what you say the tax point should be 15/03/19.

I’m with you on this Lurch, date payment taken, but Hotel was adamant that there was no way their system could send me a VAT invoice/receipt before I had checked in !!

As long as my Tagging/VAT is correct I’m happy to let it go as the argument will be long and tedious…
(I usually do love a nice legal debate with someone in the wrong! - but he reward just isn’t worth it for this one!)

It is possible that the receipt/invoice could have the tax point as 15/03/2019 so don’t start arguing with them yet! However, as you say it’s probably not worth the hassle as the VAT is the same whatever the date on their invoice says.

In which case the whole issue of tax points is moot as you can claim the vat back in the quarter when you make the payment, regardless of when the invoice is dated. If you tag the payment in QuickFile as “payment to a supplier” but not allocated to a specific purchase, and set the vat rate to the 20% you expect it to be, then QuickFile will assume that 20% when it does your VAT return. When you later assign this payment to a purchase (once you have the VAT invoice) then QuickFile should automatically adjust in your next return if there’s any discrepancy between what it calculated as 20% and what the hotel finally say on their invoice.

The whole tax point thing is more about when you are the supplier collecting the VAT, and HMRC don’t like you to hang on to “their” money any longer than absolutely necessary…

1 Like

Thanks Ian - that’s what I needed to know.