New VAT regulations
New VAT regulations came into effect on 4 January 2011. The regulations amend the principal VAT rules for three separate areas of VAT law:
- The first aims to prevent artificialavoidance seeking to exploit the change in VAT rate. The regulations introduce a ‘supplementary charge to VAT’ where a VAT invoice was issued or prepayment received before 4 January 2011 but the provision of goods or services takes place on or after that date.
- The next set of regulations substitute a new table of flat rate scheme percentages to reflect the increase in the standard VAT rate on 4 January 2011. In addition the legislation includes revised figures for the exit thresholds to reflect that increase in the standard VAT rate.
- The final regulation provides for an extension to the deadline for businesses established in other EU member states to submit a claim to HMRC for repayment of UK VAT incurred in 2009 from 30 September 2010 to 31 March 2011.