SolvedVATVAL04100 | Apportionment of monetary consideration: examples of the "Thomas" and "Nexus" apportionment calculations
From HM Revenue & Customs · VAT Valuation Manual
Value of z/r race cards = £ 58.50
Consideration for SR supplies= £450 - £58.50 = £ 391.50
Example of the calculation used in Thomas
| Description | Amount | Total |
|---|---|---|
| 450 admissions at £1 | - | £450.00 |
| Less cost of 450 race cards | £39.00 | - |
| Add 50% compliation charge | £19.50 | - |
| - | £58.50 | (£58.50) |
| - | - | £391.50 |
| VAT due on SR supplies | £391.50 x 1/6 | £65.25 |
If appropriate the figures derived from a sampling exercise can be expressed as a percentage and applied to total relevant income over a period:
| Description | Calculation | Amount |
|---|---|---|
| z/r percentage | 58.5 x 100 / 450 | 13% |
| If total income is £15,000 z/r value is | £15,000 x 13% | £1950 |
| Consideration for s/r supplies | £15,000 - £1950 | £13,050 |
| Output tax due | £13,050 x 1 / 6 | £2175 |
Example of the calculation used in Nexus
| Description | Amount | Total |
|---|---|---|
| Cost of printing and postage of z/r literature | £42,000 | - |
| Add uplift of 100% | £42,000 | - |
| Full cost of providing z/r supplies | £84,000 | - |
| Total costs of business (excluding depreciation) | £250,000 | - |
| Proportion of costs attributable to z/r supplies | 84,000/250,000 x 100 | 33.6% |
| Proportion of costs attributable to s/r supplies | 100 - 33.6 | 66.4% |
| If total subscription income (including VAT) | £400,000 | - |
| Consideration for s/r supplies | 400,000 x 66.4% | £265,600 |
| Output tax | 265,600 x 1/6 | £44,266.66 |