Can we retain completion funds in our client account if our client intends to use the money to buy another property?
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A third party, who is paying my clients costs, has requested I re-address our invoice to them instead of our client. Who should my invoice be addressed to? The fact that someone other than your client may have agreed or been required to pay for your...
Compliance Register Form / insert slip
Client Money Retention Form
The route to client money - Law Firm scenarios Download the full FREE EBook Fraudsters and cyber-attackers are targeting law firms in their attempts to steal client money and data. Millions of pounds of client money has already been stolen...
VAT: costs or disbursements passed to customers
How to account for VAT if you make supplies to your customers, and you pay certain costs that you pass
on when you invoice them.
Published 1 July 2014
There is no requirement under the VAT Act 1994 to obtain a VAT invoice in order to reclaim input tax and legislation allows HMRC to use their discretion to allow deduction of input tax based on alternative evidence. The important word here is...
Should I distinguish between paid and unpaid disbursements in my bill of costs to clients? If you decide to include disbursements on your invoice/bill of costs which you have incurred a liability for but are not yet paid at the date the...
Indirect and direct services relating to Land (VAT Act 1994 Schedule 4A Paragraph 1) Services Directly Relating to Land (Direct) If you're supplying services directly relating to land and property such as conveyancing or dealing with applications for...
Should we charge VAT on the cost of resealing probate applications within the UK? Resealing probate arises when probate has typically been obtained in a former commonwealth country, recognised by the UK under the Colonial Probate Act. This Act allows the...
Should a Bill of Costs be signed and by whom? In order for a solicitor to recover costs, the bill of costs must be signed in accordance with the Solicitors Act 1974. Section 69 (2) states: The requirements referred to in subsection (1) are that the bill...
Should we charge Output VAT on search fees when we bill/invoice them to clients? If you incur and pay for a search report when providing legal services to your clients, the VAT position when invoicing depends on the circumstances in...
SRA stance on Telegraphic Fees PDF Disclaimer The materials and content appearing on ILFMAnswers do not constitute legal or finance advice and are provided for general information purposes only. No warranty, whether express or implied...
Do I need to charge VAT on swear fees? From a payment perspective (i.e. where you take your client to a third-party solicitor who carries out a swear for your client), the VAT treatment is relatively straight forward. Under HMRC’s Notice 700...
Should I charge VAT on the cost of bank transfer fees when billed to clients and where should they be situated on my VAT invoice? Any costs (overheads) that a business incurs in the course of supplying goods or services to clients or customers are not...
What is the Principal Method and Agency Method for VAT in respect of disbursements? Under the VAT Act 1994 S. 47(2a) and S. 47(3) there are two methods in which you can treat disbursements depending who the third-party invoice is addressed to. The...
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What is an Interim Bill of Costs /Bill of Account? There are two methods for securing interim payment of costs - either by section 65(2) of the Solicitors Act 1974 for contentious business or by a specific agreement with the client contained in the...
What is an Interim Statute Bill of Costs/Invoice and what are the benefits? Interim statute bills are complete self-contained bill of costs to date. They are final bills in respect of the work covered by them, and they cannot be subsequently adjusted...
What are the time scales for Bad Debt Relief? You can reclaim VAT that you paid to HMRC and which you have not received from your client. The conditions are that: The debt is more than six months, plus your standard terms old, and less than four...
The Law Society Link here.. VAT treatment of disbursements and expenses PDF This guidance is aimed at all solicitors and their legal cashiers who have to deal with invoicing, making and receiving payments which include VAT. You are not required to...
Should I charge VAT on medical report/records when I invoice/bill my client? These can be treated as a disbursement for VAT purposes or a charge depending on the circumstances in which they were incurred. In the tribunal case (Tier 2) of the Commissioners...
Firstly, the tax point and tax rate on the original invoice being adjusted applies to the credit note being issued regardless of when you issue a credit note. The Time of Supply rules do not apply to credit notes. A Credit note simply enables you to...
This is just a guide. We encourage firms to come up with your own ideas on what you want your policies to be. In the first instance these can be based on your current practices and the 2011 Accounts Rules. Needs to be written in an easy to read format...
In the case of a firm of solicitors providing services, the basic tax point will occur when the work is completed and therefore an invoice should be issued within 14 calendar days of the work being completed. An exception to this is in respect...
Notice VAT Notice 700/22: Making Tax Digital for VAT Updated 5 March 2019 Download PDF Here Contents 1. Introduction 2. Check if you have to follow the Making Tax Digital rules 3. Exemption from Making Tax Digital 4. Digital record-keeping 5....