Get Ready for More VAT Changes

VAT-registered businesses are being urged to get ready now for major changes to VAT return filing and payment coming next April. HM Revenue & Customs (HMRC) has sent a leaflet to all 1.9 million VAT-registered businesses to alert them to the fact that, from 1 April 2010, those with an annual turnover of £100,000 or more (excluding VAT) will have to file their VAT returns online and pay their VAT electronically. Under the changes, businesses registering for VAT on or after 1 April 2010 will also have to file their return online and pay electronically, whatever their turnover.

The news follows earlier advice from MAM Software Ltd. to begin planning now for the impending change in VAT rate. The VAT rate will return to 17.5 per cent on 1 January 2010, but MAM Software is recommending companies make their preparations before they close for the Christmas break.

“Businesses should begin planning as soon as possible” explained Robin Darnell, Director of Support Services at MAM Software. “A lack of preparation will hinder the changeover. Much like Christmas shopping, the later you leave it, the busier it gets and the more stressful it becomes. If businesses plan now, they will have ample time to ask questions and understand the processes involved.”

MAM Software has published a number of detailed factsheets at www.mamsoft.co.uk/vatchange. However, to file a one of the new online VAT returns, businesses new to HMRC’s online services need to register for the VAT Online service at www.online.hmrc.gov.uk. Current HMRC online service users can add VAT Online to their portfolio.

The HMRC also carries a reminder of changes to EU cross-border VAT rules. Further details on these changes can be found by visiting www.hmrc.gov.uk/vat/forms-rates/rates/rate-changes.htm and www.hmrc.gov.uk/vat/cross-border-changes-2010.htm.