For the financial year 2007/08, net COS recovery corrections of £10,000 or more in any 3 month period required submission to HMRC for prior approval, together with copies of invoices where VAT corrections exceed £500.00. This disclosure requirement has been removed for periods commencing 1 April 2008 but may be reinstated in the future.
The March 2008 Budget increased the £2,000 voluntary disclosure de-minimis limit for errors to the greater of £10,000 or 1% of turnover, subject to an upper limit of £50,000 of VAT. For adjustments above £10,000, the limit for correcting errors on the next return is calculated by reference to the net turnover for the return [...]
The current procedure adopted by NHS bodies and accepted by HMRC for correcting errors is to enter any overclaim or payment in Box 1 of the VAT return and any underclaim or repayment in Box 4. This is incorrect, since Box 1 should only be used to account for additional output tax due. It should [...]
It has always been a requirement that anyone submitting a VAT claim or other representation to HMRC on behalf of an NHS body must present evidence that they have authority to make such representation. CRS VAT Consulting has always adopted the practice of asking our clients to sign authorisations specific to the claim being made. [...]
For VAT purposes, GPs remain outside of the NHS Divisional VAT Registrations for England, Scotland and Wales. This means that if a supply is made to a GP and an NHS body merely pays for the goods or services on behalf of a GP, then the supply is not being made to the NHS body [...]
HMRC have re-emphasised the requirement to determine any business and non-business apportionment of the VAT on capital schemes. Once this has been done, the non-business portion of the scheme can be considered under COS rules in the normal way. The effect of this is could mean an increase in VAT recovery where the scheme is [...]
By concession, HMRC currently allow certain supplies of temporary workers by employment agencies to exclude the wages element when charging VAT, i.e. VAT is only due on the commission. It was announced in the March 2008 Budget that this concession will be withdrawn from 1 April 2009. This will have the effect of further increasing [...]
In our January VAT update, we wrote about the House of Lords judgement in the cases Conde Nast and Fleming, which obliged HMRC to now repay VAT refunds accrued but not claimed for periods before 1996 right the way back to when VAT was introduced in 1973. HMRC have since confirmed that this relates to [...]
The House of Lords has delivered its judgement on the legality of the three-year cap on VAT refunds. The Conde Nast and Fleming judgement states that when the three-year time limit for VAT claims was introduced back in 1996, HMRC should have allowed an adequate transitional period for retrospective refunds to be made. Furthermore, the [...]
In our last newsletter, we provided definitive guidance agreed with HMRC regarding VAT recovery on agency staff. In particular, HMRC had ruled that VAT on nursing services and nursing staff either provided by a nursing principal or nursing agency could be recovered under COS heading 41 provided the nurses were ‘qualified’ nursing grades, i.e., grades [...]