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I'm morbidly fascinated by how the accounting for this works.
by regularfry 3y ago
I'm morbidly fascinated by how the accounting for this works.
- jimnotgym 3y agoDebit: liability account on balance sheet Credit: cost of sales Or you could just account for VAT properly in the first place like 99% of businesses manage to.
- hsjqllzlfkf 3y agoWorld isnt black and white. If you believe you don't owe it, why would you account for it as if you did. In fact it just occurred to me, just imagine what it would look like in court if their internal books showed they accounted for it as if they believed they owe it, but didn't pay it. No, this makes perfect sense. Each side proceeds based on their interpretation and once a court rules that you're wrong, you correct.
- raverbashing 3y ago> Or you could just account for VAT properly in the first place like 99% of businesses manage to. Ah yes but if you RTFineA it's not as clear cut And I kinda agree with them in this case. They shouldn't be liable for VAT on the whole of the trip cost.
- deleted 3y ago[deleted]
- petesergeant 3y ago> They shouldn't be liable for VAT on the whole of the trip cost I was going to reply to this to say "why not, everyone else does?" and then read the actual Tweet thread, which is very interesting. Thank you for encouraging me to read it!
- jimnotgym 3y agoI can't believe i actually wrote that backwards!
- mytailorisrich 3y agoThey can probably keep the amount as asset on the balance sheet until court decision (at which point liability will be created if they lose). Instead of having it in the "cash in bank" account it moves to "cash at HMRC" account, or something like that.