VAT Advice and Services

In the latest of our series of weekly Brexit Blogs, Paul Briddon of Lovewell Blake explains how the government is planning a phased introduction of import controls once the transition period comes to an end.

The original method of filing VAT returns in Xero is changing soon and we are assisting our clients to be ready for this.

In the latest of our series of weekly Brexit Blogs, Rob Geary explains how Brexit will result in changes to VAT rules which will affect any business importing or exporting goods.

‘A recent first-tier tribunal case, Wickford Development Co Limited v HMRC, has been found in favour of the taxpayer, raising again the possibility of HMRC incorrectly interpreting the scope of the ‘Builder’s Block’, this being HMRC’s block on builders and contractors recovering input VAT incurred on goods that are not ‘building materials ordinarily incorporated in a building’.

As part of the Government’s package of measures introduced to support businesses during the COVID-19 epidemic, the Chancellor has announced two extensions to initial changes concerning VAT deferments and the reduced rating of certain supplies.

Chartered accountants Lovewell Blake have appointed a former HMRC VAT expert to their specialist VAT team

Many businesses purchase vehicles to support their day-to-day operations. Whilst it may be assumed that, as a vehicle is being acquired by a business to support their activities, the VAT incurred on the purchase costs would be recoverable, this is often not the case.

At present, only VAT registered businesses with a taxable turnover greater than £85,000 are required to register for Making Tax Digital (MTD) and submit their returns through compatible software.

HMRC have advised that the reduced rate of VAT (5%) will apply to these supplies from 15 July 2020 until 12 January 2021.

Following Rishi Sunak's announcement in the Summer Statement, HMRC have updated their guidance regarding the temporary reduced rate of VAT which will apply to supplies of hospitality, hotel and holiday accommodation and attractions.

Some adept thinking from the Chancellor is welcome, but he will certainly need to do more in the autumn.

Whilst delivering the summer statement in Parliament on 8 July 2020, the Chancellor of the Exchequer, Rishi Sunak, presented his ‘Plan for Jobs’ worth up to £30 billion to help Britain bounce back from the Coronavirus outbreak.

A temporary VAT zero rate will apply to all supplies of PPE which are made between 1 May and 31 October 2020.

The CJEU has considered a VAT case concerning the recovery of overhead VAT costs for a partially exempt business who supplied goods by way of hire purchase (the taxable supply) and the supply of credit (the exempt supply).

If you are VAT registered and took advantage of the VAT payment deferral arrangements you will need to reinstate your direct debit.

If your VAT-registered business provides construction services to another business you will no longer need to charge them VAT.

VAT, PAYE and Corporation Tax payments falling due can be deferred – but should you.

A recent Court of Appeal case has decided against two organisations that provided day care services.

Making Tax Digital (MTD) for VAT was introduced on 1 April 2019 for all business trading above £85,000 of taxable supplies, with an extension until 1 October 2019 for some businesses eg groups.

A recent Upper Tier Tribunal case has resulted in digital newspapers being judged the same as hard copy printed newspapers and therefore zero rated. Prior to the case, digital publications were seen by HMRC as standard rated.

From 1 January 2020, the European Commission are introducing a number of ‘quick fixes’ aiming to simplify and harmonise EU VAT rules regarding intra-EU supplies of goods.

There are some VAT reliefs for disabled people. These typically relate to goods, however certain building works also qualify for VAT relief.