Hello Everyone,

I am NON-EU national working in a UK based Company, they are willing to sponsor my PhD,
I am looking to start it Part Time, as the university suggested me to do so,

I got a couple of questions regarding the VAT return,

1) If the university invoice my company (part time PhD overseas fee) which is around 4500£ will they be able to get VAT return on this money? if not they how we can claim VAT Back for it?
2) I heard from other people that you can claim VAT on things like medicine, laptop, books etc so can I claim VAT return on my car fuel etc?

Keep in mind that my Phd will be part time as I will be working Full Time and I am non-EU national but have no restriction on work in the UK

and Please suggest any other things which are related to my Phd, so that we can claim VAT return for that,

Thank you so much
Looking forward to hear the replies.

As there is no VAT levied on tuition fees, you would not be able to reclaim it. Medicines and books are also VAT-exempt so I think whoever is telling you this is not well-informed. I would seek advice from Her Majesty's Revenue & Customs if the information here doesn't suffice http://www.hmrc.gov.uk/vat/index.htm
My gut feeling is that it won't be worth the hassle.

Hello Bewildered,
Thanks for the reply and information

Yes but for example, the employer donate an amount say (4500£) to the university so is there any Return for that?
Or amount given for employee training etc?

Thanks

How it works at my univeristy is that I gave a letter from my employer confirming they will pay my fees, the university then raised an invoice which my employer paid. The employer then has an invoice/receipt which can be put through their books so although there is no VAt the cost should be allowable (but they shoudl check with the tax authroities in their country).

They aren't donating, they are paying a fee which isn't subject to VAT so there is no VAT to claim back - you can only claim back VAT expenses on things that have it applied. The only people who could help you on this Bewildered has already given you a link to - I'm not sure that many of the rest of us who know about these things - I've certainly never heard of being able to claim back VAT on laptops or petrol when you're a student but then I'm a UK national in ft study so my situation is very different to yours.

To claim back VAT you have to be a VAT registered company or trader (selling goods which are Vatable - hence the difference between zero rated (vat set at zero so input vat can be claimed back) and vat exempt (no vat so no input vat reclaimable)). Individuals can't claim it back (there are different rules for non-EU tourists which can claim back VAT at the airport but then they shoudl declare what ever they buy when they go home and pay import duty on it).

I don't think this is about VAT at all actually. I think them paying your tuition fees might instead be deemed an employee benefit, in which case rather than be able to claim anything back wouldn't they be liable to paying extra national insurance contributions on your behalf?

The only way I can see your firm being able to claim anything is if your PhD might possibly fall under R&D tax credits - v complicated get an accountant. Actually you just really do need to ring HMRC or ask your accountant.

Rather than your firm, it might be worth you seeing as an individual if you can set any personal costs of doing the PhD off against your own income tax payments. E.g. I believe you can claim for membership of professional organisations as this is something that can't be claimed as an expense from your employer, or if you have a home office I think you can claim some expenses. BUT be warned, if at the moment you're paying income tax solely through PAYE, it does mean form filling and the benefits are not huge at all.

Hello and thanks for the replies,

Not sure about many universities but I have an experience with one university who told me that your employer can pay donation to university which can be used for your studies.

so, what about VAT return on donation to universities? I did some google search but haven't got a proper answer,

Regards

UK universities (the public ones anyway) are charities. If a business makes a donation to a charity and receives a service in return then then VAT can be partially recoverable in some circumstances, but I think you're going to come up against the same problem: there is no VAT on tuition fees so it's a VAT exempt activity. If no-one has paid VAT then it can't be recovered.

Seriously ring HMRC or get an accountant. My sister works for HMRC and I know attempting to fiddle a VAT return is taken seriously. The law is complex and you need professional advice.

Universities have charitable status but that is only for donations ie not where you get something in exchange so that one isn't worth pursuing.


The best chance is for them to put it through their books as a cost of staff training which can be set against their corporation tax.  It would not be classed as a benefit in the same was as a car as the employer would be deemed to be getting benefit.


Any expenses that are solely and necessarily incurred as part of your employment can be offset so a PHD or masters is unlikely to be allowable - you would probably have to appeal against it and woudl be unlikely to succeed as it is not necessary for your job. The revenue are getting tougher on allowances now.  Professional fees are a different matter as they are required in order to work in that profession (eg accountant, doctor, lawyer etc are required to be registered) and so are necessarily incurred.


It been a few years since I worked as an accountant but if anything things are getting tougher to claim. Also note that when you claim against tax you only get tax relief on it so you don't get the full amount back, just the tax element (at your marginal rate).