Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Staff charges

16 June 2009
Issue: 4210 / Categories: Forum & Feedback , VAT
Company B has charged Company A for the use of its employees. Both are VAT registered, but Company B has not charged VAT on this service.

Mr X owns all the shares in two trading companies A and B. Company B formerly carried on the main trade but its business has dwindled away to next to nothing; however company A has thrived.

For historical reasons all the employees are employed and paid by company B and it receives reimbursements from company A at a sufficient level to enable it to pay its overheads and make a small profit. No invoices have been raised but both companies are registered for VAT.

Unfortunately in recent years VAT has not been charged by company B. Although there is no loss of VAT in total to HMRC we are concerned about the prospect of hefty voluntary disclosure charges.

On the basis that company A now asks for a VAT invoice to cover the amounts paid on a VAT inclusive basis there is a...

If you or your firm subscribes to, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or '' for further assistance.

back to top icon