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Deferral of VAT payments due to coronavirus (COVID-19)

2020-03-27T21:06:38+00:00March 27th, 2020|Categories: Blog, COVID-19|Tags: , , , |

The Chancellor announced a VAT payments deferral on 20 March to support businesses with cash flow during the COVID-19 pandemic. This means that all businesses with a UK VAT registration have the option to defer VAT payments due between 20 March and 3‌0‌‌ June. You therefore have until 3‌1‌‌ March 2021 to pay any VAT deferred as a result of this announcement. You do not need to inform HMRC if you wish to defer payment. You can opt in to the deferral simply by not making VAT payments due in this period. If you pay by Direct Debit you [...]

Covid-19 – Support for UK Businesses – Important Update

2020-03-25T11:43:31+00:00March 20th, 2020|Categories: Blog, COVID-19|Tags: , , , , |

Since our blog post yesterday covering some of the key changes made by Government likely to affect UK businesses (you can access the blog post here) there have been several additional measures announced. Please see below for details. If a business is concerned about being able to pay their tax as a result of the Coronavirus crisis they can call HMRC on 0800 015 9559. Though please be aware that HMRC are experiencing heavy demand at the moment, so it may take some time to get through. Should you like to read the Chancellor’s full speech you can do [...]

VAT and Brexit

2020-02-11T22:21:09+00:00February 16th, 2020|Categories: Blog, VAT|Tags: , , |

HMRC have not yet issued any guidance as to how imports and exports to the EU and out with the EU should be recorded for VAT return purposes after 31 January 2020, what happens with the reverse charge, and what should be recorded in boxes 8 & 9 of the VAT return. The last guidance given was in the case of a no deal Brexit and we are monitoring any new advice as it is issued. HMRC have said: - There will be NO requirement to complete an EC sales list for sales after 1 January 2021. - Intrastat returns [...]

Should I register for VAT?

2019-12-18T23:21:11+00:00December 21st, 2019|Categories: Blog, Business, VAT|Tags: , , , |

In broad terms, and subject to certain exceptions, a business will be required to register to charge and pay VAT once annual sales reach a pre-set annual threshold, which is currently £85,000. This threshold is determined by total sales and is not the same as total profits (which is generally sales minus expenses). However, a business can register for VAT even if its turnover (total sales) is below the threshold and it may actually save tax by doing so, particularly if its main clients or customers are organisations that can reclaim VAT themselves. Example Bill is a non-VAT registered [...]

November Questions and Answers

2019-11-01T21:18:11+00:00November 11th, 2019|Categories: Questions & Answers|Tags: , , , , |

Q. I have recently started running my own business providing training services. HMRC have advised me that VAT is not charged on the type of services I am providing. Does this mean that my services are zero-rated for VAT or actually exempt? Do I need to register for VAT? A. Although both zero-rated and exempt supplies result in no VAT being applied to the supply, the consequence is very different between them and it is important to get it right. Zero-rating is a rate of VAT, albeit at zero per cent. The goods and/or services to which it applies are [...]

September 2019 Questions and Answers

2019-09-16T17:36:46+01:00September 18th, 2019|Categories: Questions & Answers|Tags: , , , , , |

Q. I am a qualified chiropractor and I have been running my own business for many years. I would now like to specialise in a particular area and have enrolled on a university course to obtain the relevant qualification. The cost is around £18,000 per annum and the course is three years in duration, during which time I intend to continue working part-time. Is the cost of the course deductible for tax purposes? A. Expenditure incurred by the owner of a business on training courses for themselves is revenue expenditure if the course merely updates existing expertise or knowledge. Expenditure [...]

VAT ALERT: DOMESTIC REVERSE CHARGE IMPLEMENTATION DELAYED

2019-09-10T12:41:54+01:00September 7th, 2019|Categories: Blog, VAT|Tags: , , , |

There has been a last-minute change to the start date for the VAT domestic reverse charge (DRC) for building and construction services. This was scheduled to begin on 1 October 2019. It is now delayed until 1 October 2020. The government cites concern that some businesses are not yet ready to implement the change – and possible coincidence with Brexit – as the reasons for the delay. Despite the delay, the government is still committed to the DRC and there has been no change to the detail of the legislation. The DRC changes the way that VAT is accounted [...]

August questions and answers

2019-08-23T16:22:41+01:00August 6th, 2019|Categories: Questions & Answers|Tags: , , |

Q. A few years ago I bought an antique chair for £3,500. I have recently been offered £8,000 for it. Will I have to pay capital gains tax if I accept the offer? A. A useful capital gains tax exemption exists for tangible moveable property (a chattel) which is not a wasting asset (broadly, an asset with a predictable life not exceeding 50 years). A gain on disposal of a chattel is exempt if the disposal consideration is £6,000 or less. Where disposal proceeds exceed the exemption limit, the gain is limited using the following formula: 5/3 x (disposal consideration [...]

Changes in accounting for VAT after prices are altered

2019-08-23T16:22:48+01:00August 5th, 2019|Categories: Blog, VAT|Tags: , |

HMRC have published Brief 6 (2019), which explains changes to the rules on accounting for VAT, where the amount paid changes after the VAT has been accounted for to HMRC from 1 September 2019. The prices businesses charge for goods and services can be reduced after VAT has been accounted for on a supply, for example when a business delivers goods, some of which are faulty, and it agrees with its customer that the price should be reduced. When this occurs a business normally sends its customer a credit note and gives a refund. The VAT rules specify that, [...]

HMRC clarify VAT zero-rating of transport of disabled passengers

2019-09-02T11:29:29+01:00July 7th, 2019|Categories: Blog, VAT|Tags: , , , |

HMRC have issued Brief 3 (2019), which aims to clarify that the Department's policy on the scope of the VAT zero rate for transport services has not changed following the Upper Tribunal (UT) decision in Jigsaw Medical Services Ltd (2018) UKUT 0222. In this case, the UT heard an appeal by HMRC against the First-tier Tribunal's decision that emergency transport in a specially adapted ambulance was zero-rated, rather than being exempt. This decision may be of interest to suppliers that provide transport services in emergency vehicles (ambulances), or in passenger vehicles (such as, out-patient mini-buses) including those adapted for the [...]

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