As part of this year’s spring budget the Chancellor of the Exchequer,Philip Hammond, announced the change in VAT thresholds.
These changes to the registration and deregistration thresholds for VAT will bring them into line with inflation and for EU acquisition in line with the VAT registration threshold.
4,000 small businesses are set to benefit from this change as it means they will no longer have to register for VAT by the end of 2017-18. There are also benefits from the deregistration threshold being lowered as it means businesses closest to the threshold level will no longer have to constantly register and deregister.
HMRC states on its website that this measure is not expected to have any impact on the Exchequer, costing nothing until 2022.
Normally, the VAT registration and deregistration thresholds are considered annually in line with inflation through the use of the Retail Price Index (RPI).
HMRC’s website provides information on the VAT registration threshold https://www.gov.uk/government/publications/vat-registration-threshold/va…
In theory VAT should be straight forward to apply, but it’s not. As a result it’s no surprise that HMRC are raising an increasing number of VAT assessments and penalties every year.
Take a look at the VAT section of this website or give us a call to discuss how we could work with you.