You are provided with the following information relating to Novatia for the quarter ended 31 December 2019:
(1) The VAT exclusive management accounts:
|
|
£ |
£ |
|
Sales |
|
182,500 |
|
Sales returns |
|
(5,500) |
|
|
|
–––––– |
|
|
|
177,000 |
|
Purchases (Note 4) |
48,000 |
|
|
Purchases returns |
(1,500) |
|
|
|
––––– |
|
|
|
46,500 |
|
|
Impaired debts written off (Note 5) |
7,500 |
|
|
Other expenses (Note 6) |
27,000 |
|
|
|
––––– |
(81,000) |
|
|
|
–––––– |
|
Profit |
|
96,000 |
|
|
|
–––––– |
(2) The sales and other expenses are all standard rated for VAT.
(3) The sales and purchases returns are all evidenced by credit notes issued and received.
(4) The purchases are all standard rated. Included in purchases are goods which were taken out of the business by Novatia for private purposes. The goods cost £2,400 but would cost £2,500 (VAT inclusive) to replace.
(5) The impaired debts were written off in December 2019. Payment for the original standard rated sales was due on 30 September 2019.
(6) Included in the other expenses figure is £10,000 for the cost of both business and private petrol and £15,000 for repairs for Novatia’s car which had CO2 emissions of 200g/km. The quarterly car fuel scale charge (VAT inclusive) is £2,220. The input tax on the remaining £2,000 of expenses is recoverable.
(7) A sales invoice for £15,000 excluding VAT had been omitted in error from the VAT return for the quarter to 30 September 2019.
(8) During the quarter ended 31 December 2019 Novatia purchased a car for £75,000, which is used by his sales manager for private and business use and a machine for £100,000. All figures are VAT inclusive.
Required:
Calculate the VAT payable for the three month period ended 31 December 2019.
The ‘cash accounting’ scheme is not being used. (13 marks)
