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VAT Full Cost Apportionment

  • Do you need to complete a full cost apportionment calculation?
  • Do you feel that you are paying too much VAT and that your standard rated proportion is too high?
  • Do you need assistance in completing your partial exemption calculations and VAT returns on a quarterly basis?

If you have answered YES to the questions above then we would suggest that you telephone Desirie Lea on 0151 348 8400 or email specs@moco.co.uk to see how we can help you.

There have been a number of legal cases over the past 10 years regarding the supply of spectacles by Opticians. The debate has revolved around whether or not there is a single supply made by opticians upon the sale of a pair of spectacles, in which case there would be a single rate of VAT (i.e. 20%) or a mixed supply, leading to a reduced rate of VAT on the eventual sale.

The supply of spectacles is now held to be a mixed supply, as follows:-

Dispensing element - Exempt from VAT
Frames and lenses - Standard rated VAT.

Accessories sold as part of the total supply, such as chains, cases etc - Standard rated VAT.

Sight tests, whether private or under the NHS remain exempt from VAT.

The question arises, as to how to calculate the proportion of sales deemed to be at the standard rate for each pair of spectacles sold. In most cases this requires a full cost apportionment calculation. As accountants who specialise in Opticians, we are able to calculate the relevant proportion based on your figures and obtain agreement from H M Customs and Excise on your behalf. We will ensure that all costs are included in the calculation to ensure we get the very best deal for you. We have been very successful in negotiating with H M Revenue and Customs and have saved our clients tens of thousands of pounds in VAT.

We can complete your full cost apportionment calculations. We base our fees on a fixed fee structure and do not charge you a % of the VAT recovered. This will save you £££. our fees are competitive. There are additional charges for any work done in recalculating overpayments for submission to H M Revenue and Customs.

Another frustration for opticians is having to carry out full partial exemption calculations each quarter in order to determine whether or not their exempt input VAT is within the
de-minimus limits and recoverable in full.

We can also complete your quarterly VAT returns including partial exemption calculations and an annual adjustment calculation. Our fees start as little as £100 + vat per return.

Morris & Co have a dedicated team specialising in VAT and ophthalmic accounts and are able to provide advice and guidance on all aspects of financial accounting, taxation including partial exemption & business matters.

For a FREE no obligation chat about your circumstances Contact Desirie Lea on 0151 348 8400 or email specs@moco.co.uk

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