VAT News

UK VAT – Simplification Plans Announced – November 2016

13.12.2016

Following the Autumn Statement, we learn that the Office for Tax Simplification (OTS) has announced that there will be an investigation into VAT simplification measures that could be brought forward for consideration. 

The OTS is very keen to hear from businesses and advisers as to their ideas to simplify VAT administration and management. They have an email address for us all to use to make contact through and the offer is there of a meeting should you wish to engage directly at ots@ots.gsi.gov.uk

The Report will be due in Autumn 2017 but evidence from businesses will be called for in Spring 2017.

Area for consideration include:

  • the impact of reducing or raising the VAT Registration Threshold
  • the current VAT rates applied to supplies in the modern context (e-books for example)
  • Simplification potential for more complex areas of VAT management such as Partial Exemption methods, the Option to Tax and the Capital Goods Scheme
  • Focus of VAT within smaller businesses
  • Special Accounting Schemes
  • Aligning VAT more with other taxes as a part of the Making Tax Digital Plans of HMRC
  • The Penalty Regime and the Appeals process.

This announcement from the UK authorities ties in with a range of EU Commission announcements on plans to simplify VAT management issues faced by Digital Businesses whether those businesses are supplying goods or services.

For details on the review click here: OTS review VAT General Simplification Review

For more detail of the EU announcements please see our separate commentary.