UK VAT Settings using the AOC calculator

In this article, we describe how the "AOC-based calculator" can be based to cover the most common VAT scenarios at UK FBO's. FBO One also has a dedicated calculator that implements the UK VAT rules in more detail. How to set that up is described in this related article.

Typically, you would choose to use the UK VAT calculator in case your FBO sells fuel, or often handles domestic flights within the UK. If neither is the case, using the AOC calculator is sufficient to ensure that by default each client is charged the VAT rate defined for each product. Operators that are exempt of VAT because they operate chiefly on international routes, can be marked as such and will not be charged VAT on services related to handling the aircraft (the so-called air-side services). You need to create separate products in case different VAT codes apply, for example FUEL STD VAT and FUEL REDUCED VAT. When adding the product to an order, users must manually select the applicable product. Creating a product can be done by copying an existing product, or by creating a new product from the Menu | Home screen. For a more detailed guide on UK VAT see the website of HM Revenue & Customs: http://www.hmrc.gov.uk/vat/forms-rates/rates/goods-services.htm

To setup the AOC-based VAT calculator at UK FBO's, follow the below steps.

  • Go to Menu | Administration | Administrations. Edit the administration and assign the VAT rule group for AOC-based VAT.

  • Set the default 'Default VAT payment type for debtors' in Administration --> VAT rule groups to 'Landside and and airside (always)' to make sure a newly created operator will pay VAT.

 

  • Download a 'Product data summary' report in the 'Reports' menu. Check value of the 'Is Airside Product' column als well as the VAT Code column. If an operator qualifies to be VAT exempt, no VAT will be charged on airside products. Edit a product where needed by searching for it in the top-right search box.

 

  • For any operators that are self-declared to fly primarily on international routes: set Charge VAT to ‘Landside only’. This way VAT will not be charged for airside products. To review this setting use the 'Contacts' report in the 'Reports' menu. Document your decision in the "AOC/VAT remark" box. You can upload scanned PDF/proof to bulletin board of the operator in FBO One as well.

When choosing the option 'Landside only', the VAT calculator will automatically assign the VAT code (of 0%) for all products in an order that are marked as airside. The VAT code that is applied, is set in the Menu | Administration | Administrations screen and is called: 'VAT code for AOC VAT exemption'.

Note: This VAT code is also used when a client is VAT exempt because it has a valid AOC.

  • For debtors and operators that always need to pay VAT, Set "Charge VAT" to ‘landside and airside (always)’.

See also

Contact Charge VAT settings