I have a client who leases out studio spaces within a large building. My client is not VAT registered but some of the tenants are. My client charges the tenants for the electricity they use.
Some of the tenants wish to claim back the VAT on electricity which has been charged to my client by the electricity supplier.
Does anybody think this is possible?
In my eyes, the fact that my non-VAT registered client is the one invoicing the tenants for the utilities means that unfortunately the tenants have no right to claim back the VAT, even if it is included in the figures which formed the basis of the charges on their invoice.
My client has suggested putting the electricity companies VAT numbers on the invoice but I just don't see this as an above board practice. I think my client would potentially end up liable for any VAT claimed back back it's tenants.