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UK VAT Guide covering - Banking, Insurance, Construction, Commodities, Charities, Private Hire Taxi, Crypto , Pension Schemes, Energy, VAT Accounting, Business Expenses, Import, Export, Reverse Charges Autumn Budget - VAT & Tax Changes UK VAT Guide - Comprehensive UK VAT Guide to Help Businesses - Large, Medium and Small UK VAT is primarily governed by Law ( VAT Act 1994) and is enhanced by case law and administered by the UK Tax Authority known as HMRC (Her Majesty's Revenue & Customs). VAT (Value Added Tax), is a consumption tax levied on goods and services at each stage of the supply chain, with the final cost being borne by the end consumer. VAT Registered Businesses will collect VAT (output) from customers and pay this to HMRC usually on a monthly or quarterly basis. VAT Registered Businesses can also fully recover the VAT they pay on their own purchases subject to any partial exemption restrictions . On this page you will find detailed VAT guides, articles and links to help you better understand the key issues around VAT and other indirect taxes. Please try our AI VAT Advisor t o pin point any key VAT information or obtain detailed summaries relating to VAT queries you may have. UK e Invoicing 1 April 2029 VAT Explained Agents - Disclosed & Undisc Banking Bad Debt Relief Barristers Barter & Part Exchange Business Expenses Catering - Food & Drink Capital Goods Scheme Charities Commodities Construction (CIS) Crypto Currencies Debt - (Sale of Debt) Delivery of Goods Digital Services UK Carbon Border Adjustment Mechanism (CBAM) - 2027 Disbursements Financial Services Fuel & Power Global VAT Rates Importing & Exporting Goods Insurance Intermediaries Limited Partnerships Making Tax Digital Margin Schemes Motor Vehicles Opting to Tax Land Online Market Places Pension Schemes Making Tax Digital - Self Employed & Landlords - From April 2026 Place of Supply Reverse Charges Selling a Business Salary Sacrifice Self Billing Agreements Supply of Staff Taxi Services VAT Automation VAT Accounting VAT - Employee Expenses VAT Errors VAT Exemptions VAT Explained VAT Groups VAT Invoicing VAT Number Checker VAT Registration VAT - Risk VAT Schemes HMRC - (P2P) Procure to Pay (Accounts Payable) Risk Mitigation Explore UK Financial Services - VAT Explained. Explore Financial Services Product List and VAT Treatment Explore Are you Self Employed or a Landlord? Making Tax Digital Applies from 6 April 2026 Explore HMRC's Transformational Roadmap Enhanced Learning and AI Tools Read More No MTD for Corporation Tax E Invoicing Rollout Phase out of Govt Gateway Stricter Rules for Umbrella Companies HMRC - Climate Change Levy (CCL) Consultation - electrolytic hydrogen production, Read More VAT Risks Business Expenses & VAT Listed Places of Worship Grant Scheme - £25,000 Cap on VAT Recovery

Vatdigital.com - Get a round up of the latest UK, EU and Global VAT news and explore other pages where you will find UK and Global Country Guides and much more. VAT NEWS - Stay up to date with the latest UK and Global VAT news, Industry News and articles. The world of VAT and GST is rapidly changing, driven by the increased focus on digitalisation, e-invoicing, and tax authority focus on the tax gap and harmonisation. The EU's VAT in The Digital Age package (VIDA) reforms will become mandatory from 1 July 2028 with e invoicing for B2B inter EU transactions becoming mandatory from 1 July 2030. The UK Chancellor announced as part of the 2025 Autumn budget that e invoicing will be mandatory in the UK for B2B and B2G VAT invoicing from 1 April 2029. E invoicing in particular has been mandatory for years in many South American nations such as Chile, Argentina, Brazil, Columbia and in some European countries such as Italy. European countries such as Germany, Romania, Poland have adopted mandatory e invoicing more recently. In Africa, Kenya, Nigeria, Egypt, Uganda and Tunisia have all adopted and implemented mandatory e invoicing. Outlined in the galleries below are summaries of the latest UK news items and Tribunal / Court cases in relation to VAT and there is a separate section for global news items, updates and court cases relating to VAT with relevant links provided. UK VAT News From 2 Jan 2026, Online Tax Firms in London can no longer use the Tour Operators Margin Scheme loophole. VAT must be paid on full ride fare. (Not commission only) FTT - Rules that the supply of Locum (temporary medical staff) is exempt under 5, Group 7, Schedule 9, VAT Act 1994. ICAEW - Finance Bill Threat to Tax Advisors 2026 - Read ICAEW Article! Electronic Invoicing will be Mandatory in the UK from 1 April 2029 for all B2B transactions. Hotel La Tour vs HMRC - Supreme Court Judgement 17 December 2025 - Input VAT Recovery Sale of Shares. Autumn Budget UK 2025 - Key VAT & Tax Changes. HMRC Issues New VAT Grouping Rules For Overseas Establishments TSI Instruments vs HMRC (FTT) Recovery of Input VAT disallowed (non owner of the goods) HMRC - Issues GFC 13 - Help ensuring documents filed with HMRC are correct and complete. Input Tax - HMRC Late Claims Guidance Supreme Court - NHS Parking Trusts are a taxable person for VAT on car parking Hippodrome Casino vs HMRC (Court of Appeal) Standard PX Method Applies and not Floor Space. Prudential Assurance Co vs HMRC VAT Case - Tax Point for payments after entity has left VAT Group. JP Morgan Chase vs HMRC - Inter-group supplies (single or multiple taxable supplies) HMRC- Crackdown on the use of VAT Grouping in the Care Industry Capital Goods Scheme Adjustment Simplification HMRC - Issues (GFC 8) VAT Risk & Controls Framework for Organisations Barclays Services Corp vs HMRC Fixed Establishment HMRC - Transfer Pricing Compliance Risks VAT on Private School Fees - From 1 Jan 2025 VAT will be due on Private School Fees. HMRC’s Large Business Technical Note July 2025 Piramal Healthcare Ltd vs HMRC - VAT Recovery on Imported Goods Global VAT News Mauritius Revenue Authority - Foreign suppliers of Digital or Electronic Services in Mauritius must register with the MRA and account for VAT in Mauritius EU Council agrees to levy 3 Euros on small parcels valued at less than 150 Euros entering the EU from 1 July 2026. UAE - Ministry of Finance - From 1 Jan 2026 -VAT Changes to Reverse Charge Invoicing & 5 Year Limit to Input Tax Recovery. RCV - Applies to Scrap Metal Trading From 14 Jan 2026. European Commission Releases Report "Mind the Gap" Estimating the EU VAT compliance gap is EUR 128bn. Portugal Introduces VAT Grouping for Tax Periods Starting 1 July 2026. This will allow VAT amounts owing and recoverable to be netted within the group. However inter-group transactions remain Vatable. Ireland - VAT Groups - Only Branches and Head Offices Established in Ireland Allowed. CJEU - Arcomet Towercranes - Transfer Pricing adjustments - Potentially Vatable India GST Reforms - 2025 Russian Ministry of Finance - Raising VAT rate From 20% to 22% from 1 Jan 2026. Sweden will Temporarily reduce VAT on Food From 12% to 6% from April 2026 OECD - Tax Administration and Digitalisation Report 2025 EU Council - EU Customs Framework Reform Argentina "Super VAT" Proposal Philippines - From 1 June 25, 12% VAT applies on Digital Services Consumed Locally. EU - New Rules on E Commerce Import VAT to Encourage IOSS use. Canada - Government GST/HST - US Tariff Relief for Businesses. EU - VAT in the Digital Age Package (VIDA) agreed. EU - Carbon Border Adjustment Mechanism (CBAM) Brazil Tax Reform 2026 - 2033 Link to Article EU - New VAT Rules on Virtual Events and SME VAT - 1 Jan 2025

VATDIGITAL.COM - VAT Digital - Providing you with the latest UK and Global VAT News, VAT Compliance Guides, e Invoicing Updates, Country Guides and an AI VAT Advisor - online 24/7. About - VAT Digital. Com Making VAT Simple VAT Digital.Com - Is a platform designed to seamlessly "Demystify VAT " for businesses and individuals by providing the latest UK & Global VAT News, up to date VAT compliance guides and tools, global country guides & VAT rates, e invoicing news and implementation timelines, Case Law and VAT updates from the UK (HMRC) and other global Tax Authorities. There are also specific UK VAT guides and updates for industries and areas such as Financial Services and Banking, Energy, Construction, Charities, Catering, Taxis & Private Hire, VAT Compliance Automation, VAT Risk Management and Control and much more. The website is updated regularly by our team of VAT and Tax specialists who have many years of experience working in industry and practice. Our Website now incorporates an AI driven "VAT Advisor" to enable you to obtain guidance for specific queries in relation to VAT, Tax and other related topics quickly and reliably online 24/7. We hope you find the information on this site useful and enhancing. For any queries, please email the team at enquiries@vatdigital.com or contact us using the form below. VAT DIGITAL. com VAT - TAX - Accountancy - London Anthony Ene - Founder To contact us, please use the form opposite and we will endeavour to get back to you as soon as possible. Alternatively please use the "Lets chat" button. We hope you enjoy reading and find the information on our website enhancing and useful. Best Regards The Team - vat digital .com -------------------------------------------------------------------------------------------------- - Email: enquiries@vatdigital.com Submit Thanks for submitting!

VATDIGITAL.COM - Making VAT Simple - 24/7 VAT AI Advisor - UK , EU and Global VAT Compliance, VAT News and Guides, Global VAT Rates , HMRC News & Updates, VAT Automation & E Invoicing News, VAT Case Updates Making VAT Simple Making VAT Simple Vat Digital.Com Vat Digital.Com VAT DIGITAL.COM - UK & Global VAT News & Compliance UK & Global VAT News UK VAT Guides UK Tax News & Updates Country VAT Rates Country VAT Guides HMRC Updates E Invoicing News and Updates VAT Automation Guide VAT for Small Business VAT for Banking & Financial Services VAT for the Construction Industry VAT for the Energy Industry VAT AI Advisor - Online 24/7 VAT Career Guides VAT Returns & E Filer Links VAT Risks & Controls VATDigital.Com Making VAT Simple Demystifying VAT - Online 24/7 VAT Digital.Com making vat simple UK Autumn Budget-VAT & Tax Update November 26 2025 Read More VAT Digital.Com making vat simple Financial Services VAT Banking - VAT VAT Explained Global VAT Guides UK VAT Guide VAT News Register For VAT Check a VAT Number is Valid Global VAT Rates VAT on Business Expenses Europe VAT Guide UK - VAT Invoicing Rules Finance - VAT Liability Table E - Invoicing Updates Mergers & Acquisitions VAT Construction - VAT P/L & VAT VAT Risk VAT Accounting Reverse Charges VAT Rates - Goods & Services Importing & Exporting VAT Groups Intercompany Recharges & VAT Selling a Business & VAT VAT Error Corrections VAT Compliance Automation VAT & Food Banking And VAT Investment Banking Corporate Banking Retail Banking Private Banking Read More Partial Exemption Special Methods (PESM) VAT Allocation & Recovery MTD & VAT E2E Automation Interco Recharges & Reverse Charges Banking income - VAT Liability International Trade Fixed Establishment & VAT Grouping Risk Management & Controls E Invoicing

VAT digital media - Global VAT, GST, E invoicing and Key Case Law updates from around the globe. VAT Digital Media - Keep up to Date with VAT, GST and E Invoicing News

VAT Careers - What its like to work in VAT in different sectors, skills and experience required, job interview tips, top recruitment consultants , VAT job links CAREERS IN VAT VAT Digital. Com WORKING IN VAT JOB INTERVIEW TIPS RECRUITMENT CONSULTANTS MARKET & SALARY GUIDES

Global VAT Guides. Information and guides on how VAT and GST is applied in different countries. Including VAT and GST rates, VAT rules, the VAT and GST liability of goods and services, imports and exports, plus links to local Tax Authority websites and much more. GLOBAL VAT - Country VAT Guides - How VAT Applies VATDIGITAL.COM - Explore our Global VAT Guides for information and updates on VAT and GST rules and how they are applied to locally and international transactions including to non domiciled entities. Australian - GST Austria - VAT Canada - GST / HST China - VAT Denmark - VAT Germany - VAT EU - VAT French - VAT Estonia - VAT Ireland VAT Italy - VAT Japanese Consumption Tax Show More Argentina - VAT Chile - VAT Jersey - VAT Show More VAT For Businesses - EU Explore Luxembourg - VAT Nigeria - VAT Ghana - VAT South Africa - VAT Netherlands - VAT Norway - VAT Portugal - VAT Singapore - GST Spain - VAT Israel VAT Saudi Arabia - VAT Switzerland - VAT Show More Poland VAT India - VAT Kenya VAT Show More Ecommerce - Online Traders - EU One Stop Shop Explore

VAT Guide for the Netherlands including VAT rates, VAT registrtaion, imports and exports and much more. Introduction There are 3 different rates of VAT in the Netherlands: 0% Zero Rate = Exports of Goods or Services 9% Reduced Rate = Food & Drink, Newspapers, Magazines, Agricultural Products and Services, medicines 21% Standard Rate = Applies to goods and services that do not fall under above or are not exempt. Click on the button below for more information about VAT in the Netherlands. How VAT Works in the Netherlands netherlands - Vat

Businesses are required to register for VAT in the UK and file VAT returns to HMRC once their turnover reaches £90,000. Visit our site to find out how VAT works, including guides, useful links and information. Introduction VAT (Value Added Tax) is a tax on consumption and is added to the sale of goods and services supplied by VAT Registered businesses. Not all products and services sold attract VAT and there are a number of VAT rates or categories as follows: Standard Rated 20% (taxable) Reduced Rate 5% (taxable) Zero Rated (taxable) Exempt Outside The Scope Depending on the goods being sold or services being provided, one of the categories above will be applied to the sale. Standard Rated Goods and Services Standard Rated goods and services are goods sold or supplied by VAT registered businesses and include 20% VAT. Therefore invoices to customers will include 20 % VAT. Standard Rated services fall into the taxable services bucket and where businesses make taxable sales and exceed or are likely to exceed £90,000 , they are required by law to Register for VAT. Examples of Standard Rated goods and services include: Fuel Professional Services such as Legal and Accountancy Computers and Mobile phones Hotel Accommodation No Domestic Energy Alcohol Restaurant food and hot takeaways Goods and Services with Reduced Rate VAT of 5% Reduced rate VAT of 5% is mainly applied within the domestic fuel and construction industry. Examples of Reduced Rate VAT at 5% include: Domestic / residential energy bills (Gas & Electric) Gas fired boiler installation Radiator Connection or re-connection to the gas mains Renovating a dwelling that has been empty for at least 2 years Zero Rated VAT Goods and services supplied as Zero Rated VAT are taxable supplies but without VAT applied. Therefore invoices generated and sent to customers for zero rated supplies will not include VAT. Examples of Zero Rated goods and services include: Children's clothing Books Sewerage services supplied to domestic or industrial customers Water supplied to domestic households Insulation Take away - cold food Note: where businesses make sales of goods and services to non UK business customers, these can also be treated as Zero Rated in some instances as they are deemed outside the scope of UK VAT but are classed as taxable services which carry the right to deduct Input VAT. (Please see place of supply button) Exempt Goods and Services Exempt supplies of Goods and Services unlike standard rated and zero rated are not taxable supplies. Exempt supplies are listed in the VAT Act 1994 Sch 9 and include the following: Postal Services Insurance Land and Property Rental Education Financial Services Tax Point R ules Tax points are the specific points in time when sales of goods or services take place and are governed by rules set out by HMRC. VAT registered businesses must account for VAT within the period the tax points for their sales occur. So if a tax point occurs in March and the businesses next VAT return period is January to March then the VAT on the sale will have to be included within the quarter ending March VAT return. Basic Tax Point Goods - The date when you send them to your customer or the customer takes them away or for goods assembled at a suppliers premises, when the goods are made available to the customer Services - The date when the service is performed — it’s normally taken as the date when all the work except invoicing is completed Actual Tax Point The basic tax point will be overridden if an actual tax point is created. An actual tax point is created when: An invoice is issued or payment is received (whichever is first) before the basic tax point. An invoice is issued up to 14 days after the basic tax point You do not have to follow the 14 day rule, but if you decide not to you must tell HMRC by writing to the VAT Written Enquiries Team . If you wish to have an extension of the 14 day rule, then you must apply to HMRC by writing to the VAT Written Enquiries Team , giving your reasons. Note: Failure to tell HMRC about extending the 14 day rule will result in the tax point reverting to the basic tax point. Continuous Supplies of Services If you supply services on a continuous basis and receive payments regularly or from time to time, there’s a tax point every time you issue a VAT invoice, or receive a payment, whichever happens first. If payments are due to be made at regular intervals (for example, by banker’s order or direct debit), you can issue a VAT invoice at the start of any period of up to one year (provided that more than one payment is due in the period) to cover all the payments due in that period. For each payment you should set out the: VAT-exclusive amount Date on which the payment is due Rate of VAT VAT payable If you decide to do this, you do not have to account for tax on any payment until the date on which it is due, or date you receive it, whichever happens first. Your customer must not reclaim, as input tax, any VAT shown on the VAT invoice until the date on which the payment is due, or you have received the payment, whichever happens first. The same procedures apply to continuous supplies of goods, in the form of water, gas and electricity. Goods supplied on sale or return, approval or similar terms When you supply goods on sale or return, for example, they have not been sold and you still own them until such time as they’re adopted by your customer. Adoption means that the customer indicates a wish to keep them. Until your customer does so, your customer has an unqualified right to return them at any time, unless you have agreed a time limit. You may have fixed a time limit of adoption of less than 12 months from the date when the goods were sent. If a time limit has: Been fixed for a period of 12 months or less, then the Basic Tax Point is the date the time limit expires Not been fixed or fixed for a period of more than 12 months, then the Basic Tax Point is 12 months from the date when the goods were sent Note: In either case if your customer adopts the goods before the time limit expires the date of adoption becomes the basic tax point. Also the basis tax point as mentioned above will be overridden by the actual tax point on the date an invoice issued by the business providing the goods or the date payment is received for the goods, which ever is earlier. If you receive a payment which is not returnable, this will normally indicate that the goods have been adopted. The payment of a deposit required as a condition of delivery — which is repayable if the goods are returned — does not constitute adoption. Finally, It is a businesses responsibility to make sure that its customers notify them promptly when they have adopted goods. Goods taken for personal or other non-business use Goods that are taken out of a business: Permanently for non-business use will have a basic tax point on the date when the goods are taken or set aside for this purpose Temporarily for non-business use, but they’re still part of its stock or business assets, then a tax point is triggered each time they’re used or — if the non-business use continues over a period of time — on the last day of each tax period that the goods are used or made available for that purpose VAT Returns VAT Registered businesses that make supplies of goods and services are required to file their VAT returns to HMRC either monthly or quarterly (depending on VAT scheme) to pay over the Output VAT collected on sales to their customers and also to recover any Input VAT they have incurred on supplies they have purchased for operating their business. The difference between the Output VAT collected and the Input VAT incurred will form the basis as to whether VAT is payable or recoverable from HMRC. VAT collected on Sales greater than VAT incurred on purchases = Payment due to HMRC VAT incurred on purchases greater than VAT collected from customers = Recovery of VAT from HMRC Any exempt and zero rated supplies a firm makes to its customers or purchases from its suppliers also need to be included on the VAT Returns in boxes 6 and 7 respectively. Partial Exemption - VAT Recovery In addition to Output VAT that is collected by a business on its sales and then paid over to HMRC, businesses can also recover VAT on expenses they incur. The recovery of VAT depends highly on the nature of the supplies being made by the business. Business is only making Taxable Supplies (Standard rated, reduced rate or zero rated) - then the Input VAT incurred on its purchases is directly attributable to its taxable sales and can be fully recovered from HMRC. Business only makes Exempt Supplies - Then it cannot recover any of the input VAT incurred on purchases as the input VAT is directly attributable to supplies of exempt goods or services. Businesses making a mixture of Taxable and Exempt Supplies - This type of business is known as a partially exempt business and because not all of its supplies are taxable, it can only recover a calculated percentage of the input VAT it has incurred. Partially Exempt Businesses - will be required to calculate their partial exemption recovery percentage or rate and then apply this rate to their pool of input VAT that they have incurred. The standard method for calculating the partial exemption recovery rate is as follows: Taxable Sales (Standard, Zero, Reduced Rate) / Total Sales (Standard, Zero, Reduced Rate, Exempt) = VAT Recovery Rate Percentage % Example - Standard Rated Sales £1,000, Zero Rated Sales £500, Reduced Rated Sales £200 and Exempt Sales £2,000 £1,000 + £500 + £200 / £3,700 = 46 % RR If the input VAT pool is £20,000, then the business can recover £9,189 from HMRC via its VAT return. Note: Many larger and more complex businesses (such as banks) will have Partial Exemption Special Methods which will have been formulated specifically for their business and agreed with HMRC. Many businesses will have multiple internal business areas and products and as such using the standard method may not be suitable. Once formulated businesses will be required to adhere to their agreed Partial Exemption Special Methods and keep HMRC up to date on any internal business restructures that might affect the agreed method. HMRC - has the right to issue a Special Method Override where they believe the existing method in use does not produce a fair and reasonable level of VAT recovery. Annual Input VAT Adjustments As part of the VAT return process partially exempt businesses are required to complete annual Input VAT adjustments to ensure the correct amount of VAT has been recovered from HMRC for the overall year. Normally businesses will file quarterly VAT returns which include VAT recoverable for the quarter. The recovery of VAT on the quarterly returns will be based on the input VAT allocated between Taxable and Exempt sales for the quarter or based on the previous years VAT recovery rates which are being provisionally used for the current year until the annual adjustment is completed. So VAT returns completed during the year are actually provisional in terms of the recovery of VAT. As such at the end of the year input VAT recovery will need to be revisited to: Review how input VAT has been used in the business to see if there has been any change in use. (Taxable / Exempt) Recalculate VAT Recovery Rates based on the current years sales data Review input VAT allocations to different areas of the business Once the above process has been completed, the recalculated input VAT recovery for the whole year will then be compared with the input VAT reclaimed on the quarterly returns. Any under or over recovery of VAT will then be refunded or repaid to HMRC normally via the first VAT return of the following year. From a business perspective, it maybe important to carry out mid year reviews of the VAT recovery by looking at aspects such as actual VAT incurred and Actual VAT recovery rates so as to not have large swings in irrecoverable VAT which can affect P&L where the input VAT throughput is significant. (Most relevant to partially exempt businesses where VAT recovery is high). Reverse Charges Where firms purchase services from non UK suppliers that would normally have VAT applied in the UK, they will have to self account for reverse charge VAT in the UK. The purpose of this measure is to ensure UK companies have a level playing field competitively and as such ensure companies do not make their purchases abroad just to avoid paying 20% VAT. The following purchases would attract Reverse Charge VAT Legal and Accountancy services Software Advertising Consultancy For example if a UK company purchased legal services from a company in France for £1,000 then the UK company would have to include £200 on its UK VAT return as output VAT and will equally it will able to include £200 as recoverable input VAT. Note: as mentioned under partial exemption above, the level of input VAT recoverable by a business will depend on the type of sales it makes. If a firm only makes taxable (standard and zero rated supplies), then it will be able to recover the full £200 reverse charge VAT which is payable to HMRC. In this case, as the reverse charge VAT payable is equal to the reverse charge VAT recoverable and as such there is nothing to pay HMRC. If the firm also made exempt supplies to it's customers and the French legal fee charge was not related to a specific taxable supply being made by the UK company, then it would only be able to recover a portion of the £200 reverse charge VAT based on its Partial Exemption Recovery rate. On its VAT return the business would enter £200 in box 1 (Output VAT) and £200 in box 4 (input VAT recoverable) and thus box 5 ( VAT payable of recoverable from HMRC ) would be nil. The net values of the services would go in box 6 (net outputs) and (net inputs) respectively. For more information on reverse charges, please click on reverse charge button on the home page. Pre VAT Registration Expenses Where a business buys goods or services before it registers for VAT, to support taxable business activities when it is registered, it can recover the tax provided that: in the case of goods (either stock for resale or fixed assets), the goods remain on hand at the date of registration and will be used in the newly registered business. These goods must have been bought within the time limits that are set out in regulation 111; for businesses with a registration date after 1 April 2010 the time limit will be 4 years in the case of services the supply was made not more than six months before the date of registration. Six months represents a period in which it is deemed that services obtained will relate to business activity carried on at the time of registration. Tax incurred on goods on hand at registration (other than capital items - see below) cannot be deducted if the VAT was incurred outside of the time limits set out in regulation 111. This includes VAT incurred on services performed on those goods. If a business is given a backdated registration date this becomes the relevant date for working out the extent of the time limits. Businesses are not required to reduce the VAT deducted in respect of pre-registration use of fixed assets. For example, VAT incurred on a van purchased three years before registration and used before and after registration would be recoverable in full, subject to the normal rules on VAT deduction. You can only reclaim VAT on purchases for the business now registered for VAT. They must relate to your ‘business purpose’. This means they must relate to VAT taxable goods or services that you supply. Please see below HMRC link for more information. VIT32000 - How to treat input tax: pre-registration, pre-incorporation and post-deregistration claims to input tax under regulation 111 - HMRC internal manual - GOV.UK (www.gov.uk) Required VAT Records and Accounts All taxable persons must keep and preserve certain records and accounts. This VAT record-keeping requirements that anyone who is registered for VAT must comply with includes: The VAT account What records must be kept Maintaining and preserving records For more information see Record keeping (VAT Notice 700/21) . -Contains public sector information licensed under the Open Government Licence v3.0. VAT Explained - How VAT Works in the UK

VAT Careers can be interesting and rewarding as it is a very specialised and Niche area. Discover the Pros and Cons of working in VAT and the different areas. Introduction Value Added Tax (VAT) is a consumption tax that is applied to a wide range of goods and services. There are a wide range of rules and regulations both of a legal and compliance nature that organisations both large and small have to adhere to. As such organisations whether large or small will require human capital to apply and comply with VAT legislation and file VAT returns to HMRC on a timely basis. Working in Practice Accountancy practices come in different shapes and sizes and range from: The small self employed owner managed Practices that provide book keeping services (VAT, Payroll, Annual Accounts, Self Assessment, CIS) to small businesses Franchised Practices such as Tax Assist or CerTax Practices with 2-10 Partners that typically provide a range of accounting, Audit and Taxation services to small and medium sized businesses Larger medium sized with 10 or more partners providing Taxation, Audit, Accounting and advisory services to medium sized entities Big 4 Accountancy Firms (Deloitte, EY, KPMG, PWC that provide services to large Private Companies, Public companies such as banks, Private Equity Houses etc and services can range from Consultancy, Technology, Audit, Taxation, Accounting and more. Typically working in practice involves providing services as listed above to external businesses for fees. Therefore normally an individual will commence their career as a junior (Graduate, School or college leaver) learning the ropes from more senior staff until eventually they receive an allocation of clients to manage. As their knowledge, experience and skills improve, juniors can typically move up the hierarchy to Manager, Senior Manager, Director, Associate Partner, Partner or their equivalent. As the fees billed are per hours worked, most accountants, tax specialists, technology specialist, Partners etc that work in Practice will be required to maintain and record their hours on time sheets to support the charging out (billing) to clients. Working in Industry Working in industry is basically the other side of the coin where Accountants and Tax Advisors will look after the internal VAT compliance, VAT Accounting and VAT legal Advisory aspects of the businesses. Basically VAT roles are usually split between VAT Compliance and VAT Advisory or a combination of both. Also roles can be focused on different internal segments or divisions within an organisation. For Example in a transport company you may have the Train Division and Bus Division or in Banking you may have an Investment Banking and Retail Banking division and as such the VAT rules and their application can be different depending on which area is being covered. Typically VAT Specialists will spend time working on the following: Preparing and or reviewing internal company VAT and other related returns for submission to HMRC M anaging VAT Risk and embedding controls Ensuring Accounts Payable processes are VAT compliant Ensuring the Process for Bad Debt Relief Recovery is sound Feeding in to Senior Accounting Officer risk meetings VAT Accounting and VAT Recovery Forecasting Managing VAT P roj ec ts Maintaining and building VAT Systems Advising M anagement on VAT, Advising client facing departments on billing VAT Advising Finance with VAT reporting Providing advice on Mergers and Acquisitions (M&A) Advising on Intervention Reviewing Contracts Advising on Sourcing and Procurement to ensure VAT efficiency Advising on Establishment & Fixed Establishment Advising on Securitisation Advising on Loan Syndication Registering and de-registering companies from VAT Creating VAT Groups Advising on Business Disposals (TOGC) Advising on international aspects of VAT Working in industry can mean working for Banks, Food Companies, Retailers, Oil Companies, Car Manufacturers, Airport Operators, Train Companies, Energy providers and basically any corporate entity that's not Practice as described above. As you can imagine from the duties and tasks typically performed above, VAT is a specialist area and requires a sound understanding and knowledge of UK VAT Law, EU VAT Law, Case Law, International VAT, compliance along with solid practical experience applying this to real life day to day transactions. The more knowledge you have and experience you gain in these areas, the more illuminated you will become in the VAT world which is actually a small specialist community. Qualifications Required The following professional qualifications are usually requested for roles within VAT. ( However the list is not exhaustive) Chartered Institute of Taxation (CTA) Association of Taxation Technicians (ATT) Associate Chartered Accountant (ACA) Institute of Chartered Accountants Association of Chartered Certified Accountants (ACCA) Association of Accounting Technicians (AAT) That said, it does not mean if you do not have one of these qualifications that you can't pursue a career in VAT. Many VAT specialist gain their experience working for HMRC before moving into Practice or Industry. List of Key Skills and Knowledge Required Regardless of Individual Professional Level Thorough understanding of UK VAT Law (VAT Act) and how it is applied to every day business transactions Sound understanding of the VAT liability of various products and services. Applicable rates of VAT Good understanding of European VAT principles VAT and its impact on M&A Transactions VAT on Sourcing and Procurement Professionalism and Ethics Good IT skills. For example experience in using Excel, WORD, Power point, SAP, Sage, Zero, Alteryx etc. Excellent Communication Skills Ability to work under pressure Being Analytical and having an eye for detail Must be collaborative Understand the importance of risk mitigation Have a continuous improvement mindset Emotionally Intelligent Understand the importance of diversity and its impact on business Good commercial awareness Ability to build and maintain key relationships Good understanding of VAT accounting and its impact on P&L Understanding of VAT Groups and Establishment Principles Understanding of how billing systems work and applied VAT coding Good knowledge of and application of reverse charge VAT and its Impact on costs and P&L Knowledge of the Error Correction Notice and Protective Claim procedure. Partial Exemption Special Methods Property and Option To Tax Construction Industry Scheme (CIS) Trainee / Analyst / Graduate - Entry Level At this level, the roles in VAT will normally be about learning and providing support to Managers / Assistant Vice Presidents and Senior Managers / Vice presidents. You will be expected to rapidly grasp the basic fundamentals of VAT while studying for one of the qualifications listed above. Some of the typical duties will include: Preparing or assisting in the preparation of VAT and other returns before further stage reviews Assisting with VAT administration, chasing responses and documenting various aspects relating to projects Investigating issues and problems and reporting on these to senior colleagues Preparing procedure notes to document processes Preparing VAT journals for review and posting Helping out with the Annual Adjustment Capital Good Scheme analysis Assisting in providing advisory support to internal business areas Manager / Assistant Vice President At the Assistant Vice President level, you are more likely to be doing a lot of the heavy lifting. Some of the typical duties will include: Preparing and or reviewing VAT returns Providing advice to clients or internal stakeholders Preparing annual adjustments Assisting Senior Managers, Vice presidents and Directors on projects Building and maintaining good relations with Finance and IT Assisting accounts payable and receivable in relation to VAT coding Capital Good Scheme preparation Option to Tax Advising on reverse charges and its application Ensuring VAT is being correctly coded or booked in systems Oversight of VAT Accounting Senior Manager / Vice President The Senior Manager / Vice president / Associate Director level brings with it significantly more ownership of processes and overall responsibility of particular business areas to ensure the accuracy of VAT and other Returns and the mitigation of risk. Also will be the first point of call for client and internal advisory support. Some of the typical duties will include: Reviewing VAT and other returns to ensure their accuracy Reviewing Annual Adjustments Annual review of Partial Exemption Special Method (PESM) Ensuring that control failures are documented, fixed and monitored Reviewing and signing off of VAT accounts Assisting accounts payable and receivable in relation to VAT coding Capital Good Scheme preparation or review Advising clients on M&A, Intervention, securitisation, Invoicing, Financing etc. PESM modelling / redraft Keeping up to date with legislation and preparing impact assessments Inter-company transactions and VAT impact Managing projects Managing junior staff Mentoring, Training and coaching Junior staff Making Tax Digital implementation and review Thorough understanding of systems Preparing reports for senior management Liaising with HMRC to resolve queries Managing internal and external audits Managing VAT reporting Director Directors typically have large VAT teams to manage on either the compliance or advisory side or can be the overall Head of VAT. At this level, most of the time will be spent overseeing the team and ensuring it is working towards the stated annual objectives. Some of the typical duties will include: Setting the VAT objectives for the organisation Reporting to the CFO or Head of Tax and keeping them updated with events Advising on VAT aspects of M&A and Intervention Advising on Global E Invoicing Implementation Requirements Advising on the set up of new branches and establishments Planning and overseeing internal / HMRC Partial Exemption Special Method Reviews Holding regular meetings with HMRC to update them on business changes, new product areas etc. Overall review and sign-off of VAT and other returns Mentoring, Training and coaching the team Having regular catch-ups with key clients Having regular catch ups with external consultants and attending industry events Overall responsibility for risk and controls and ensuring they are operating correctly Liaising with internal and external auditors to plan and coordinate timings and understand scope of audits etc. Overall responsibility for ensuring new products and services have been reviewed for VAT, documented and signed off. Overall responsibility for ensuring the digitalisation of VAT. Keeping up to date with Legislation and ensuring that changes are filtered down and implemented. Ensuring that VAT is being budgeted for on costs and all significant VAT risks are reflected in the P&L Chairing regular Team meetings Ensuring that clients are engaged and happy and dealing with any complaints promptly and robustly Ensuring that a strong risk culture is embedded in the team Dealing with staff recruitment Arranging regular training for the Team VAT Careers - Key Aspects of Pursuing a Career in VAT

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