Important VAT Update

Now that we are in 2010 there are three major VAT changes to contend with:

  1. The standard rate of VAT has returned to 17.5%
  2. VAT Flat Rate Scheme users must note their percentage rate change
  3. EC Changes – most importantly relating to EC Sales Lists and also bringing the supply of services into “reverse charge” accounting

Rate change

  • You need to change the standard rate to 17.5% (if you use computer software it may be useful to use another code for the old rate of 15% to help when processing entries with VAT at the old rate)
  • Motor Fuel Scale Charge entries will need to change
  • Further notes can be found on our website – click here to follow the link

 

Important note for all VAT Flat Rate Scheme Users

 

If you are using the VAT flat rate scheme please note the percentage rate you use changed from 1 January 2010.
Despite assurances that the percentage rates under the Flat Rate Scheme would return to the November 2008 levels, for many business sectors this is not the case. Therefore, please ensure you refer to the Flat Rate VAT pdf which lists the old rates as well as the new rates.


If you wish to discuss whether the Flat Rate Scheme is still beneficial to you, please contact M+A Partners on 01603 227600 or email enquiries@mapartners.co.uk

 

EC changes

 

The main changes are:

  • VAT is now accounted for in the country where the CUSTOMER belongs on most business services. Previously it was based on where the SUPPLIER belonged
  • EC Sales Lists (ESLs) need to include the sale of services as well as goods
  • ESLs need to be filed within 14 days of the end of each calendar quarter, or 21 days if filed electronically
  • A new electronic procedure has been introduced so that claims for VAT incurred in other EC countries are made through the UK Government Gateway

 

Lastly – don’t forget that for most businesses, on-line filing of VAT returns will be compulsory from April 2010.

For guidance on any of the above areas contact M+A Partners on 01603 227600 who will be pleased to help.

 

 

Disclaimer - We believe the information in this update to be correct at time of publication, but we cannot accept any responsibility for any loss occasioned to any person as a result of action or refraining from action as a result of any item herein.