4 April 2013    |    Uncategorized

VAT defaulters campaign

HMRC are focussing on those with VAT Returns in arrears in an effort to bring everything up to date, as they obviously believe that there are huge possible defaults.
In our view, keeping the Returns up to date is a core business requirement, and we recommend filing the Returns even if you do not have the resources to settle them, and then trying to reach agreement with HMRC about payment.  If you cannot meet your VAT payments, there is a serious underlying problem with the business that needs to be resolved, quickly.
HMRC are writing to all traders with VAT Returns in arrears to chase them up.  This includes many of our clients who are in permanent repayment positions – such as fishing boats and crofters – and whilst they face no penalties at the present time, it is likely that this will change in the coming years.
We are recommending to everyone that they bring everything up to date, as afar as is possible, and that we look at alternative VAT schemes, such as Annuals Return, for those who find making four quarterly repayment claims too much hassle.
However, a recent application for a trader in a permanent repayment position was rejected as he needed to bring everything right up to date before such an application would be considered.  We have suggested to HMRC that this is a silly piece of bureaucracy on their part, but it remains unresolved. We hope that our client will send us his accounts and four repayment returns to 31 March 2013 before the 30 June 2013 Return becomes overdue, and we can then get him onto Annual Accounting.

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