VAT Business Alert - February
From 1st April 2010 all VAT registered businesses with a turnover of over £100,000 are required to register and submit VAT returns online.
03.02.2010
From 1st April 2010 all VAT registered businesses with a turnover of over £100,000 are required to register and submit VAT returns online.
Our first Business Alert for 2010 focuses on VAT news and recent changes that could affect you and your organisation. Click on the links below to read each article in detail.
Online VAT Returns: Deadline 1st April 2010
Online VAT Returns: Deadline 1st April 2010
All VAT registered businesses with a turnover of over £100,000 are required to register and submit VAT returns online from 1st April 2010.
HMRC are in the process of contacting all businesses that are affected by these changes. If you are not already registered for the online VAT returns read on.
Submitting online VAT returns has a number of advantages:
· An extension of 7 days to submit VAT returns;
· Avoid defaults due to postal delays;
· Automatic registration for electronic EC Sales Lists & Intrastat (with extended submission dates);
· Automatic registration for new electronic EU VAT Refund service (8th Directive);
Our VAT team is holding VAT surgeries in Glasgow and Edinburgh during the weeks of 8 March and 15 March 2010.
- Each surgery consists of a one to one meeting that will last approximately 45 minutes
- We will assist you to complete the compulsory online registration process (for both returns and direct debit arrangements); and
- We will also explain the online VAT return process.
- The cost is £75 plus VAT.
To sign up email: nicola.bryson@scott-moncrieff.com or call us on 0131 473 3500.
On 1 January the standard-rate of VAT reverted to 17.5%. The rate change is bad news for individuals or organisations that cannot recover all of the VAT they incur on expenditure e.g. charities and financial institutions.
HMRC published guidance that confirms that suppliers can charge VAT at the 'old' standard-rate of 15% for work that was performed between 1 December 2008 and 31 December 2009. If work is performed in a period where both rates of VAT were in force, a supplier can apportion their invoice (and therefore the VAT rate they charge) to reflect the time that the work was carried out.
We expect more VAT rate changes to be made after this years general election.
From 1 January new rules affect how VAT is charged on the provision of services to/from different EC member states.
The 'basic VAT rule' used to require VAT to be charged and accounted wherever the supplier belonged. From 1 January, the 'basic rule' for 'business to business' transactions now requires VAT to be accounted where the customer belongs (the customer will then account for VAT using the reverse charge mechanism).
Over the next 5 years the rules for international services will continue to change. You may want to clarify whether you or your clients are affected (either through the provision or receipt of services).
Where certain conditions are met, zero-rating applies to the construction of new buildings, approved alterations to listed buildings and conversions of commercial buildings.
To qualify for zero-rating a charity building must be used “solely” for non-business purposes. The existing rules define “solely” as 90% of the time, and there is no requirement for the charity to monitor the use of the building thereafter. From 30th June 2010, the term “solely” will increase to 95% and the position must be monitored for 10 years. We expect this will reduce the availability of zero-rating, as many charities will not meet the 90% test.
There are opportunities to reduce or remove the cost of irrevocable VAT on building works, and any charity constructing a new building or refurbishing an existing one should consider the VAT position. In all cases it is worth considering the VAT position at the planning stage of a building project.
For further advice and information on any of these issues please contact Scott Craig, VAT Partner.
