VAT on entertainment expenses
June 21st, 2010
Under current tax rules, VAT on entertainment expenses is not reclaimable. However, a recent decision in the EU relating to two Dutch companies may change that. IF the European Court agrees with the decision of the EU Advocate General (and it usually does), VAT on business-related entertaining expenses will be reclaimable. There will be a chance to claim this VAT retrospectively up to 4 years. If the amount involved is less than £10,000, you will be able to include it in Box 4 of your next VAT return.
You must wait until the European Court has confirmed the Advocate General’s decision (it may reject the decision but this is unlikely) but compile the details so that you are ready to make a claim as soon as it is possible.
The content of this article is for general information only. It should not be relied on and action which could affect your business or personal circumstances should not be taken without appropriate professional advice.
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