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Ask Your Own Question, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5115
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
Type Your Tax Question Here... is online now

Dear Sirs I am running a diving school and we are ltd and

Customer Question

Dear Sirs
I am running a diving school and we are ltd and vat reqistered company. I would like to know how to calculate VAT when I teach diving courses.
1. Price of the course is £300 (advertised on website)
2. Cost of PADI books and materials - £30 (my price with discount); PADI suggest cost of the materials £50 for students ( I know there is no VAT on books)

How to pay VAT?
1. Do I pay it on £300 (total price of the course) or can we say its education so no VAT at all?
2. Do I pay it on £300-£30=£270 - less price of the materials (VAT 0%)
3. Do I pay it on £300-£50=£250 - less sugested price for students; my discounts not included
4. Or can I sell books for more - lets say £70 and pay VAT on £300-£70=£230?

What is the best way?

Kind reagards
Submitted: 4 years ago.
Category: Tax
Expert: replied 4 years ago.
Hello and welcome to the site. Thank you for your question.

Please clarify for me ... is the advertised price inclusive of VAT or does it say £300+VAT

Many thanks
Customer: replied 4 years ago.
The advertised price is inclusive of VAT. That's what I charge students for the course.

Expert: replied 4 years ago.

Krzysztfo, thank you for your reply.

If the course price is inclusive of the materials and sale price of materials is £50 then you calculate VAT using option 3 below

3. Do I pay it on £300-£50=£250 - less sugested price for students; my discounts not included

If you were to exclude the charge for materials and advertise your course fee as £230 inclusive of VAT and students buy materials as optional extra then VAT would be calculated on £230 only.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Expert: replied 4 years ago.

Hello Krzysztfo

I notice you have viewed my response to your question on how to calculate VAT (JACUSTOMER-x2q2xwz4- Last Viewed on 17/12/2013 at 23:42).

Just checking to see if you have any issues relating to your question that I may not have addressed.

Please let me know if I can be of further assistance.

If you are happy and there are no more issues I will appreciate if you would kindly rate the service I provided to ensure I get paid for it.