Practical example

Don “XX” has been carrying out the activity of Cafeteria, section 672.1, since 2015.

The activity is carried out in a rented premises for which he pays 760 euros per month (plus VAT ). Since it began, the taxpayer is covered by the simplified VAT regime and has developed the activity with the following elements:

• Electrical power: 20kw
• Tables:
  • 4 tables for 4 people
  • 2 tables for 2 people
• Type «B» machines: 2 machines

As for the staff employed in the business, the owner and 2 full-time employees work throughout the year; an 18-year-old worker 900 hours, since February 1, and two workers, from July 1 to September 30, who have worked 720 hours each.

In 2020, the number of workers was 2 full-time workers throughout the year plus the owner of the activity.

Other information to take into account:

• On July 1, 2021, he purchased an electric oven for 450 euros and on October 13, he replaced the furniture for 2,000 euros.

• On November 30, purchase napkins, coasters and other material in Portugal for 2,500 euros.

• At the end of the year, the total amount of VAT borne in current operations amounts to 9,330 euros.

  1. Calculate the income on account for the first three quarters.
  2. Determine the annual fee for the activity.
  3. Determine the result of the final self-assessment of the fourth quarter.

• In fiscal year 2021, the volume of operations under the simplified regime has amounted to 130,000 euros.

Solution:

1. Calculation of deposit on account:

   Activity: cafeteria Heading IAE : 672.1, 2 and 3
   Module	Definition	Unit	Annual accrued fee per unit
   1	Employed personnel	Person	2,356.07
   2	Electrical power	Contracted kW	124.00
   3	Tables	Table	70.86
   4	“A” type machines	Type «A» machine	221.43
   5	Type «B» machines	Type «B» machine	832.60
   6	Lottery commissions	Euro	0.21
   Minimum fee for current operations: 13% of the fee accrued for current operations

   Base data as of January 1, 2021:

   • Employees: 3 people x 2,356.07 = 7,068.21 euros
   • Electrical power: 20 kw x 124.00 = 2,480.00 euros
   • Tables: 5 tables x 70.86 = 354.30 euros
   • Type «B» machines: 2 machine x 832.60 = 1,665.20 euros
   • Total: 11,567.71 euros
   • Payment on account (4% x 11,567.71) = 462.71 euros
   • Choose to deduct input VAT from fixed assets in the declaration for the last quarter.

   • Quarterly quota 1Q, 2Q and 3Q: 462.71 euros.

   • ( See Q1 of model 303 )

2. Annual activity fee:

   Activity: cafeteria IAE heading: 672.1, 2 and 3
   Module	Definition	Unit	Annual accrued fee per unit
   1	Employed personnel	Person	2,356.07
   2	Electrical power	Contracted kW	124.00
   3	Tables	Table	70.86
   4	“A” type machines	Type «A» machine	221.43
   5	Type «B» machines	Type «B» machine	832.60
   6	Lottery commissions	Euro	0.21
   Minimum fee for current operations: 13% of the fee accrued for current operations

   Amount due for current operations:

   • Employees: 4.10 people x 2,356.07 = 9,659.89 euros
   • Electrical power: 20 kw x 124.00 = 2,480.00 euros
   • Tables: 5 tables x 70.86 = 354.30 euros
   • Type «B» machines: 2 machines x 832.60 = 1,665.20 euros
   • Total: 14,159.39 euros

   Quota derived from the simplified regime: the largest of the following quantities:

   1. Amount due for current operations: 14,159.39 euros

      Fees supported by current operations:

      • Supported fees: 9,330.00 euros (*)
      • 1% difficult justification: 141.59 euros
      • 9,471.59 euros
      • Fees supported 9,330.00 euros + 1% difficult justification: 141.59 euros
      • Difference: (14,159.39 - 9,471.59)= 4,687.80 euros

      (*) The fees borne by the rental of the premises are fees borne by current operations and, therefore, are included in the total amount for this concept. If the premises were owned, the fees incurred in its acquisition would be deductible as fixed assets.

   2. Minimum fee: (13% of 14,159.39 euros): 1,840.72 euros

      Therefore, the fee derived from the simplified regime is 4,687.80 euros

      Annual fee:

      • Quota derived from the simplified regime: 4,687.80 euros
      • Fee accrued for intra-community acquisitions of goods (2,500 euros x 21%): 525.00 euros
      • Deductible VAT fixed assets (450 x 21% + 2,000 x 21%): -514.5 euros
      • Annual fee: 4,698.30 euros

      Result of the final self-assessment:

      • Annual fee: 4,698.30 euros
      • Income on account for the year: (462.71 x 3): -1,388.13 euros

      4th quarter declaration result: 3,310.17 euros

      ( See Q4 of model 303 )