VAT – Partial exemption calculations
A number of changes that simplify the VAT partial exemption de minimis rules become effective from 1 April 2010. Whilst the partial exemption rules remain the same the changes being introduced simplify the calculations required by certain businesses.
The first change removes the need to carry out detailed partial exemption calculations to confirm whether they qualify as de minimis.
The second change allows businesses to apply the de minimis test annually rather than for each VAT return (normally quarterly), thereby reducing the number calculations required each year.
There is also a third change which corrects a minor drafting error.