Seems that HMRC allow you to use the crappy buy rate when you convert your invoices from Euros for the purpose of VAT. Of course, the crapper your invoice converts to sterling the less VAT you pay back on it (if you're on flat rate).
Its easy to find historical rates for mid rates (i.e. not the crap buy ones) and I'm sure I've read somewhere that commericial buy rates are normally about 4% on top. However, since HMRC expect you to quote your source for exchange rates I dont know if they'd be happy if I just took mid-rate and added 4%. (but then again how are they going to check exact historical tourist rates cos I cant find them!)
Of course, ideal situation is to check the tourist rate on the day you invoice and stick the converted sterling amount on your invoice for information. You're supposed to do this anyway.
Unfortunately, despite asking him about three times about Euro invoices in general, my accountant never though to advise me of this simple task. Admitedly, I could have read it myself on the HMRC website,
Anyway, VAT return and accountant has just gone and used a standard historical rate for that day. Didnt discuss with me just did it. I'm aware you could use the HMRCs standard rate for a month but see my opening paragraph. For me, depending on rate it could mean £20-£30 month extra VAT. Not a huge amount but hey.
Its easy to find historical rates for mid rates (i.e. not the crap buy ones) and I'm sure I've read somewhere that commericial buy rates are normally about 4% on top. However, since HMRC expect you to quote your source for exchange rates I dont know if they'd be happy if I just took mid-rate and added 4%. (but then again how are they going to check exact historical tourist rates cos I cant find them!)
Of course, ideal situation is to check the tourist rate on the day you invoice and stick the converted sterling amount on your invoice for information. You're supposed to do this anyway.
Unfortunately, despite asking him about three times about Euro invoices in general, my accountant never though to advise me of this simple task. Admitedly, I could have read it myself on the HMRC website,
Anyway, VAT return and accountant has just gone and used a standard historical rate for that day. Didnt discuss with me just did it. I'm aware you could use the HMRCs standard rate for a month but see my opening paragraph. For me, depending on rate it could mean £20-£30 month extra VAT. Not a huge amount but hey.
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