Value added tax (VAT) is usually considered not to be an expense of a business as the cost is ultimately passed on to the customer. However, where a company or trader has failed to operate VAT correctly and this comes to light in an audit, it will usually be too late to pass the charge on to the customer at which point the underpaid VAT (plus interest and penalties) can become a very significant cost for a business.
Kevin Hendricken
Director
Taxation & VAT Services
