Going green...
Blog Plummer Parsons | 1 December 2009
Due to a recent upgrade, the VAT online service offered by HMRC has now been redesigned to standard HMRC green colours and now looks and functions in much the same way as the other online services. This has made it much more user friendly and simpler to follow which can only be a good thing ahead of the introduction of compulsory online filing of VAT returns from 1 April 2010.
All VAT quarters beginning on or after 1 April 2010, will need to be filed electronically for businesses with an annual turnover of £100,000 or more (not including VAT). Also, all businesses that newly register for VAT, whatever their turnover, will have to file their returns online. Payments to settle VAT liabilities will have to be made electronically by one of the HMRC approved methods although the due date for payment when paying electronically is 10 days later than when filing on paper and paying by cheque.
The measurement of turnover for the purpose of this test will be made on 31 December 2009, so all businesses with annual turnover of £100,000 as at that date will be included in the requirement to file online, whether or not their turnover subsequently falls below that amount.
Failure to meet the new filing requirements can result in a penalty. The penalties for failure to comply with the Regulations will apply to returns made for periods ending on or after 31 March 2011, thus allowing businesses a period of a year to adjust before the penalties for failing to file online are imposed. The penalties, which increase according to the VAT exclusive turnover of the business failing to make the return by the required method, are :
Turnover £100,000 and under £100
Turnover £100,001 to £5,600,000 £200
Turnover £5,600,001 to £22,800,000 £300
Turnover £22,800,001 and above £400
There are a number of acceptable methods for making electronic payment. By far the easiest method for payment is to setup a direct debit and the amount due will be collected automatically on the due date for payment. You can also pay the liability using internet or telephone banking, or by BACS direct credit or CHAPS transfer from your bank account. Paying by debit or credit card is also available using the BillPay service.
Unusually, HMRC treat paying by Bank Giro as an acceptable electronic method. If your bank or building society offers the Bank Giro service you can make a VAT payment at your own bank or building society branch by cheque or cash using a Bank Giro paying-in slip. This means you may get up to an extra seven calendar days after the standard due date for the cleared payment to reach them. To use this payment method HMRC will need to send you a book of Bank Giro paying-in slips that are pre-printed with your VAT registration number and the HMRC bank account details. You can order a book of paying-slips by email or over the telephone. When phoning to order the Giro slips you will need to quote your VAT registration number and business name.
If your business has a turnover exceeding £100,000 you need to act now. If you need further information do not hesitate to contact us.
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