VAT News

Developers beware!

In a recent case a developer created an unwelcome VAT cost by the method used to transfer a property

Autumn Budget 2017 and VAT

The Chancellor has not made many changes to VAT, with Making Tax Digital and Brexit on the horizon this is understandable.

Making Tax Digital and VAT

HMRC has announced a radically different timetable for the introduction of Making Tax Digital (MTD). 

Brexit begins…

Negotiations on the terms of the UK’s exit from the EU have begun. There will not be any changes until March 2019 at the earliest, but businesses must be prepared for the effects of leaving the EU, the Single Market and the Customs Union.

Changes to the flat rate scheme – are you affected?

From 1 April 2017 a new category has been introduced for "limited cost traders".  HMRC have written to all businesses using the flat rate scheme explaining the changes and have also issued a revised VAT Notice 733 to cover the changes and how to apply them. The change...

Autumn Statement – change to the VAT flat rate scheme

The Government has become concerned that some small companies are being set up specifically to take advantage of the VAT flat rate scheme and other tax reliefs offered to small businesses. These companies typically offer labour-only sub-contract services and so do not...

HMRC backtracks on pre-registration VAT on assets

In recent years HMRC has been restricting claims for VAT incurred before registration in regard to assets bought and used in the business before registration.  Contrary to their previous policy, they were insisting that the VAT incurred on assets purchased in the four...

In the Zone, claiming VAT on company cars

As a general rule VAT on the purchase of a car is specifically blocked. However, if a car is intended for use for business purposes and it is not intended to be made available for private use the VAT may be recovered under the normal rules.  Over the years HMRC has...

Brexit and VAT

A month after the referendum on membership of the EU we are no clearer as to what the future relationship with the EU will be.  VAT is the tax that will be most affected by the UK's departure from the EU but it is unlikely that it will be greatly changed in nature. ...

Permitted Development Rights and VAT on property conversions

VAT status of dwellings created by conversion of non-residential buildings A dwelling that has been created by the conversion of a non-residential, for instance by conversion of offices or a barn, is similar in VAT terms to a new-build dwelling.  As long as certain...

DIY Housebuilder claims

The latest version of the DIY Housebuilder claims forms do not show the address to which claims should be submitted. Instead, claimants are asked to call 03000 569 145 to find out the correct address to which their claim should be sent.  Claimants using previous...

Penalties and DIY claims

HMRC's new penalty regime has always sat uncomfortably with the Do It Yourself Housebuilder Scheme.  Claimants who make incorrect claims not only face unexpected VAT costs but the threat of a penalty to boot.  This has always seemed unfair and illogical.  Claimants...

Does your business provide fuel for private use in cars?

VAT registered businesses that provide fuel for private use in cars need to take account of the supplies of fuel they are deemed to be making to the owner, partner or employee of the business.  Alternatively, if reimbursement of fuel for private use is required output...

Opening soon – the Mini One Stop Shop

The place of supply of broadcasting, telecommunications, and electronic services is changing If you make sales of services via the internet you may be supplying "broadcasting, telecommunications, or electronic ('BTE') services".  For instance, selling software...

Do you supply services through the internet?

This article deals only with the supply of electronic services.  The place of supply rules for broadcasting and telecommunications services are similar but involve a “use and enjoyment” override (see VAT Notice 741A Place of supply of services for more information)....

Could your tenants be landing you with a VAT bill?

One of the changes made in last year's budget was the introduction of VAT on the letting of buildings and other structures, often shipping containers, for the storage of the tenants' own goods.  Although this measure was aimed at the self-storage businesses commonly...

Machine Games Duty – a VAT trap?

Background Machine Games Duty (MGD) was introduced on 1 February 2013 and replaces Amusement Machine Licence Duty and VAT on the machine takings. Anyone responsible for premises where it is possible to play machines subject to MGD must register for MGD and make...

Trading in the UK but not established in the UK?

On 1 December 2012, following a ruling in a European Court case, HMRC will be withdrawing the VAT registration threshold for Non-Established Taxable Persons (NETPs).  An NETP is an individual whose normal place of residence is outside the UK or a corporate body that...

Should you be charging VAT to your tenants?

Background Before 1 October 2012 if a specific area of land (land includes buildings) was let under a lease or some types of licence the supply was exempt from VAT, unless the land was subject to an option to tax.  The government perceived an anomaly in the VAT status...

VAT and Cosmetic Surgery

In recent years Britain has experienced a boom in cosmetic surgery and procedures.  The old inhibitions on changing our appearance are receding and there is now a wide range of treatments available.  But how much is health care, which is exempt from VAT, and how much...

Is this a building I see before me?

What is a "building" for VAT purposes? Earlier this year the Tribunal ruled that the construction of a skate park by a charity for relevant charitable use was nonetheless standard rated as the skate park was not a "building".  The Tribunal was extremely supportive of...

When does a child become an adult?

When does a child become an adult?  Never, some parents may be tempted to answer but according to HMRC it is when they reach 14 years of age.  Although this is based on body size rather than maturity it is sometimes possible to apply the zero rate to clothes that...

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