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HMRC internal manual

VAT Time of supply

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HM Revenue & Customs
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Accommodation tax points: corporate purchasing cards: approval procedure

 

 
 
 
 

Procedure

Card operators insist that all their suppliers apply for an accommodation tax point if they have not already been granted one (a single direction applies to all corporate purchasing card transactions as defined in the direction, regardless of the card issuing company or bank involved). This is primarily to safeguard the position of card holders (purchasers) to ensure that they do not find themselves in the position of unwittingly having reclaimed input tax before they are entitled to.

To enable the card companies and banks to monitor the position, it has been agreed that they can include a standard form of application as part of their own application procedure. This is reproduced below. The completed application is then sent by the card company or bank to HMRC.

Applications should be scrutinised on receipt to ensure that they have been completed correctly. An incomplete or incorrect application should be returned direct to the applicant for amendment as required. It should then be re-submitted to HMRC. Checks should also be made to ensure that the applicant has not already been granted an accommodation tax point of this kind. Duplicate applications should be returned with a covering letter explaining that the existing direction covers all corporate purchasing card supplies.

Satisfactory applications may be dealt with locally by the issue of a direction in the form set out below. A copy of the direction is to be retained on EF. Also, if the applicant requests, a copy of the direction may be sent to the card issuing company or bank at the address indicated on the application form.

Form of application

VALUE ADDED TAX - APPLICATION FOR A DIRECTION UNDER SECTION 6(10)(a) OF THE VAT ACT1994

For the purposes of this application ’corporate purchasing card’ means acorporate purchasing or procurement card under which arrangements a card company or bank will issue to the card- holder a VAT invoice for all purchases made using the card.

I/We request that supplies of goods and services by ……………………………..(insert company or business name) for which payment is to be effected by means of acorporate purchasing card, shall be treated as taking place on the date when details ofthe transaction are transmitted to the card issuing company or bank, provided such date is earlier than would otherwise apply.

I/We further request that on the issue of the direction any existing direction which might otherwise apply to such supplies, will cease to have effect in so far as it applies to the above mentioned supplies.

I/We also request that a copy of the direction be sent to (name and address of appropriatecard company or bank).

Signed (normal signatory to VAT return):

Status of signatory:

Name of company or business:

Address:

VAT registration no:

Form of direction

To: (Name and address of applicant)

VALUE ADDED TAX - DIRECTION UNDER SECTION 6(10)(a) OF THE VAT ACT 1994.

For the purposes of this direction ’corporate purchasing card’ means a corporate purchasing or procurement card under which arrangements a card company or bank will issue to the card- holder a VAT invoice for all purchases made using the card.

In exercise of their powers under section 6(10)(a) of the Value Added Tax Act 1994 the Commissioners for Her Majesty’s Revenue & Customs hereby direct that supplies by you of goods and services for which payment is to be effected by means of a corporate purchasing card shall be treated as taking place on the date when details of the transaction are transmitted to the card issuing company or bank provided such date is earlier than would otherwise apply.

This direction replaces any existing direction to the extent that the existing direction applies to the above mentioned supplies and will remain in force until you request otherwise or it is revoked.

Date:

Signature:

For and on behalf of the Commissioners for Her Majesty’s Revenue & Customs

cc (Name of card company or bank)