16 May Common VAT myths debunked
One of the worst things you can do as a business owner or sole trader is to follow incorrect information when basically your business depends on it. However, the internet is home to a plethora of self-proclaimed ‘experts’ that are giving inaccurate advice and information. Read on to discover some of the most common VAT myths that you should stop believing.
You are going to get a fine and a penalty for making an error on your VAT return
While this can happen, it is not always the case. The nature of the error and the circumstances of it will be taken into account, as well as whether HMRC have suffered a loss because of it. This is when expert VAT advice comes in incredibly useful, ensuring you can prepare for any audit that may be coming your way.
You can reclaim VAT from another country in the EU on your return
This will be classified as a mistake if you attempt to do this. You need to look into the local guidelines for the country where the tax was incurred. This is the only way to go about reclaiming VAT from another country.
HMRC will never find out if you do not register for VAT in another country
Don’t make the fatal error of believing you can fall under the radar when it comes to registering for VAT in another EU country. The European Union’s Mutual Assistance Recovery Directive enables tax authorities to cooperate to ensure that foreign VAT is not underpaid. In fact, cross-border audits, penalties and fines are becoming more common these days.
EU VAT rules are no longer going to mean anything in the UK
You may be reading this and thinking to yourself: “why are you mentioning EU VAT rules when we have voted to leave Europe?” Even once Brexit has been completed, it is still likely that EU tax rules will be followed.
If you require any further VAT advice, please do not hesitate to contact SQK Accountancy and we would be more than happy to assist. Call us today on 020 8798 0657 for more information.