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VAT in the UK

Registration and Compliance Procedures for VAT in the UK – Recent Update

News

Recently, there has been increased interest from foreign sellers wishing to do business in the UK business community. The first and perhaps most important requirement is to register for the VAT in the UK tax. This is a requirement of the British Tax Authority known as the HMRC.Read More

Deregister for VAT

How to De-register for VAT?

How to, Tax, VAT

There is a “de-registration threshold” (which is actually the exception from registration figure), which has traditionally “tracked” the registration threshold at ¬£2k less (though there is no obvious reason why it should be this figure). The general approach is that once an entity’s turnover is below that threshold the entity need no longer be registered until and unless it exceeds the registration thresholds.
The legislation specifically allows HMRC to entertain de-registration where the entity satisfies HMRC that its taxable turnover in the ensuing year will be below the prevailing “de-registration threshold”‘. How to deregister for VAT?Read More

Penalties

Penalties

Tax, VAT

The rules relating to penalties can also change somewhat independently of the specific rules about VAT registration. For that reason, reference should be made as necessary to the specific VAT penalties rules. Nevertheless, the following is a brief guide that applies at the time of writing and that provides some pointers.

The current penalties for failure to register on time apply as a percentage to the net payable tax.Read More

Groups of companies

Groups of companies

VAT

Group registration is a business facilitation measure which also reduces HMRC’s administrative effort. It allows different entities(groups of companies) to form one VAT registration and to submit common returns. This has the effect of aggregating both the sales and purchases of the grouped entities. It also allows supplies to be made between members of the VAT group without them being treated as supplies for VAT purposes (and accordingly no VAT is chargeable on them).Read More

VAT after Brexit

VAT policy changes after Brexit

News, VAT

VAT after Brexit: In the run up for Brexit, the UK may retain the current structure of taxes, make changes or replace it. It is deemed to be very unlikely that the UK will make significant changes in the VAT structure system and the VAT rates. The government will want to protect and keep the level of revenues if receives from VAT tax.

The Scottish government has been receiving half of the revenue collected in Scotland. Therefore, leaving the VAT system as it is will safeguard the trade with EU countries. The ruling of the Court of Justice of the European Union will soon end, but the UK will probably want to maintain the legal continuity and heed the CJEU.

Business Fragmentation

Business fragmentation and VAT registration

VAT

The idea, here, is that steps may be taken to split a single business between two entities or more in order that one or more of them should avoid having to be VAT registered. As mentioned elsewhere, the general rule is that it is the legal entity which is registered for VAT (irrespective of how many businesses it contains), and not the business as such. Thus, unless there are safeguards, it is unduly tempting to try to split a business down the middle in order to avoid VAT registration, by partitioning it between various different legal entities.
HMRC have two defences against this:Read More

Abbreviated accounts

Bye-bye Abbreviated Accounts!

Companies House, News

From the accounting periods 2016/2017 the abbreviated accounts for small businesses will be abolished. What are the options?Two year ago Financial Reporting Standards for, Entities changed in line with the Companies, Partnerships and Groups (Accounts and Reports) Regulations 2015. This has created a lot of confusion about new requirements, the biggest ones being new thresholds for qualifying as a small company, changes to dis, closures required in small company accounts, accounts formats and different filing obligations.Read More

self-confidence

What boosts your self-confidence?

How to

Scientists have discovered strong links between self-confidence and occupational success. A study at the University of Melbourne involved interviews with professionals, involved interviews with Hundreds of professionals from around the world. Participants were asked to describe their level of confidence various times in their lives. Those who reported higher confidence earned better wages and were noted more quickly. Fortunately, becoming more confident is not as difficult as you might think simple things can make a big difference. Here are 4 tips of how to become more self-confident and boots your career prospects.Read More

Profit or Consideration

Profit or Consideration for VAT Purposes

VAT

A common business model is for parties to come together in a joint venture, sharing the costs, and, they hope, sharing the profit in preordained ratios. It is also common to believe that the amounts shared are merely a profit distribution and therefore outside the scope of VAT. This is based on the view that neither party makes a supply to the other, because they are both in a joint endeavour, and they are both seeking simply to make supplies to other third parties. Leaving aside, for the moment, whether, jointly, they are making taxable supplies, the question remains as to whether this analysis of the share of proceeds being “profit” has any impact on the VAT position.Read More