VAT on credit card transactions

[James Sutlow]

We have an office credit card which is used for some office purchases and staff expenses, there are 10 card holders and around 200 transactions per month, we ask the card holders to add the receipts to an intranet portal and then once a month we spend a long time reviewing the receipts, allocating them to an expense nominal and working out if we can claim VAT. We’ve tried to push this back to the card holders but most of them are marketing staff who don’t understand accounts/VAT and we don’t have a lot of confidence that they would get everything right.

Just wondering if anyone else has anything similar and if so how it’s handled? We have a fairly small accounts team and it generally takes the team the best part of a day to complete this by the time we’ve worked out what the receipts are for. We calculated that by claiming back what VAT we can we are recouping at least £1,000 so it seems worth doing, it can just be quite stressful, especially if it’s at the end of the month!

[Marc Pegg]

Hi James

I feel your pain (or my Accounts colleagues do).

It’s painful, it takes best part of a day to complete. Lots of back and forth to cardholders for missing receipts and missing posting details to ascertain the VAT position etc.

Couple of points which may ease the burden:

1. Can you adjust the reconciliation / payment date wiht your provider to mid-month, to mitigate interfering with month end?

2. Can you limit the use of expenses paid for my cardholders – for example, can just one cardholder (office manager) order office supplies and other cardholders (fee earners) use theirs for marketing (coffees), and travelling expenses.

Best.
Marc

[Phil Invernizzi]

Hi James

I also feel your pain. I’m the lucky one who does ot here. Constantly chasing receipts and reconciling them can be time consuming.

There are some good apps that do a good job allowing users to claim as they go attaching receipts but I’ve not looked into that yet as we only have 5 people with cards.

Good luck

Phil.

[Linda Lambert]

Hi James

Not sure if this will help but can you view the credit card on line? If so would doing this chore(!)say, weekly on a Wednesday make it less unwieldly? It could be for the previous week and may help when you have missing receipts.
Treat more like bank recs which I suspect are done very regularly! At least then not too much work for the month end. Kr Linda Lambert

[Author]

Posts