(1). Jerome is a decorator. On 20 July 2023, he started a contract to decorate an office building, completing the contract on 23 August 2023. An invoice was issued for the full amount of the contract on 3 September 2023 and this was paid by the client on 10 November 2023.
What is the tax point (date of supply) for Jerome’s decorating contract?
A 20 July 2023
B 23 August 2023
C 3 September 2023
D 10 November 2023
(2). Ming prepares VAT returns for the quarters ended 31 March, 30 June, 30 September and 31 December. On 10 May 2023, she purchased standard rated goods costing £5,000 from an overseas supplier. The goods were sold for £8,000 on 2 August 2023. These figures are exclusive of VAT.
What entries will be made on Ming’s VAT returns in respect of these goods?
A Output VAT of £1,600 for the quarter ended 30 September 2023
B Input VAT and output VAT of £1,000 for the quarter ended 30 June 2023, and output VAT of £1,600 for the quarter ended 30 September 2023
C Input VAT of £1,000 for the quarter ended 30 June 2023, and output VAT of £1,600 for the quarter ended 30 September 2023
D Input VAT of £1,000 and output VAT of £1,600 for the quarter ended 30 September 2023
(3). In which circumstances will a VAT registered business be required to issue a VAT invoice?
A When a standard rated supply is made to any customer
B When any type of supply is made to any customer
C When a standard rated supply is made to a VAT registered customer
D When any type of supply is made to a VAT registered customer
(4). Which item of information is not required on a simplified VAT invoice?
A The supplier’s VAT registration number
B The supplier’s name and address
C The customer’s name and address
D The rate of VAT
(5). How will an overpayment of VAT of £5,400 be reclaimed from HMRC?
A By entering it on the current VAT return
B By making a separate claim to HMRC
C By resubmitting the incorrect VAT return
D By submitting a separate VAT return just for the overpayment
The following scenario relates to questions 6-10.
Alice commenced trading on 1 January 2023. During the period 1 January to 30 April 2023, her taxable supplies were £9,000 per month; during the period 1 May to 31 August 2023, they were £10,500 per month; and during the period 1 September to 31 December 2023, they were £12,000 per month.
Alice is now in the process of completing her VAT return for the quarter ended 31 March 2024. During the quarter, sales invoices totaling £66,900 (exclusive of VAT) were issued in respect of standard rated sales, whilst standard rated expenses amounted to £19,200 (inclusive of VAT).
Required:
(6). From what date was Alice required to be registered for VAT?
A 1 November 2023
B 1 October 2023
C 1 December 2023
D 1 September 2023
(7). Which one of the following is NOT a condition for the recovery of pre-registration input VAT incurred in respect of goods?
A The goods must have been acquired in the four years prior to registration
B The goods must have been acquired for business purposes
C The goods must not have been sold or consumed prior to registration
D The goods must have been paid for prior to registration
(8). How much VAT will Alice have to pay to HMRC in respect of the quarter ended 31 March 2024?
A £9,540
B £10,180
C £7,950
D £7,310
(9). By what date will Alice’s VAT return for the quarter ended 31 March 2024 have to be submitted to HMRC?
A 30 April 2024
B 7 May 2024
C 7 April 2024
D 31 March 2024
(10). Which VAT scheme would provide Alice with automatic relief for impairment losses?
A The cash accounting scheme
B The flat rate scheme
C The annual accounting scheme
D None of the schemes