Simplified Import VAT Accounting
HMRC have published a new version of the Simplified Import VAT Accounting (SIVA) notice.
SIVA was introduced a number of years ago to assist VAT registered businesses by reducing the financial guarantees required to operate a duty deferment account for VAT purposes. The scheme is specifically designed for businesses that incur VAT on imported goods. It can also help reduce security requirements and associated costs as well as the compliance costs of having a guarantee in place.
Obtaining approval to use SIVA means that the financial guarantee for import VAT can be reduced to zero for the amount specified by HMRC (based on current or anticipated liabilities). A guarantee will continue to be required for Customs and Excise duty.
In order to be approved to use SIVA, businesses must have been VAT registered for more than three years. HMRC will also look at other criteria including debtor history, offence record, VAT compliance history and financial viability before deciding whether to approve an application to use SIVA.