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VAT

Expert commentary and practical guidance from ICAEW related to VAT under the UK tax regime.

In this section

Features and articles

MTD compliance updates

Kim Hau assesses the results of a Thomson Reuters survey into how firms are preparing for MTD.

VAT record keeping

VAT-registered businesses must keep records of sales and purchases, keep a separate summary of VAT called a VAT account and issue correct VAT invoices.

VAT returns

You usually submit a VAT Return to HM Revenue and Customs (HMRC) every 3 months. This period of time is known as your ‘accounting period.’

Correct errors on your VAT return

You can adjust your current VAT account to correct errors on past returns if they’re below the reporting threshold, not deliberate and for an accounting period that ended less than 4 years ago.

Starting to import

Most businesses use a courier or freight forwarder to import goods from overseas. What you need to do depends on whether you’re importing from within the EU or outside the EU.

VAT repayments

Usually, if you’ve charged your customers less VAT than you’ve paid on your purchases, HM Revenue and Customs (HMRC) repay you the difference.

VAT registration

You must register your business for VAT with HM Revenue and Customs (HMRC) if its VAT taxable turnover is more than £85,000.

Webinars and recordings

TAXbite: MTD - bank feeds

An explanation of how bank feeds can be used as part of a business' journey towards meeting the Making Tax Digital requirements for its accounting records.

Practical guidance

TAXguide 21/17: The tax implications of Brexit

Although many of the implications of Brexit are currently unknown, VAT and customs duties are likely to be affected. This guide outlines the potential tax consequences. This guide was updated following the publication on 23 August 2018 of guidance from HMRC as to what will happen if there is no Brexit deal.

TAXguide 01/17: Let property

This TAXguide provides guidance on the tax issues connected with let property from the point of view of the landlord. It concentrates on residential property and is aimed at practitioners who are advising individuals who have bought property as an investment, rather than commercial property development businesses. Read a summary here, Tax Faculty members can download the full guide.

TAXguide 23/17: VAT MOSS

In TAXguide 23/17, Neil Gaskell explains the changes introduced on 1 January 2015 to the VAT rules for business to consumer supplies of digital services within the EU. This guidance has been updated to include changes introduced on 1 January 2019. Read a summary here, Tax Faculty members can download the full guide.

TAXguide 01/15

Professional Conduct in relation to Taxation.

TAXguide 04/09

Money laundering: supplementary guidance for the tax practitioner

Markel Tax FAQs

Questions and answers on UK tax issues and trends from the ICAEW Tax and VAT Helpline, a subscription service provided by MarkelTax.

Markel Tax FAQs are correct at the time of going to press. To check current validity, please call the ICAEW Tax and VAT Helpline.

The Library & Information Service provides a collection of eBooks as a benefit of membership. Please log in to access these titles. If you are unable to access an eBook, please see our Help and support or contact library@icaew.com.

Income tax

Fully updated guide focusing on each area of the financial statement in detail with illustrative examples. This chapter on accounting for income tax gives a comparison of FRS 102 Section 29 and IFRS, and covers VAT and similar sales taxes, current tax, recognition and measurement of deferred tax, allocation of tax charge or credit, consolidated tax returns and offset of taxable profits and losses within groups, presentation, and disclosure.

Value added tax 1

A chapter setting out the essential principles of VAT, as set out in the Value Added Tax Act 1994 and subsequent Finance Acts.

Value added tax 2

This second chapter on VAT explains how the tax is administered by HMRC, as well as a number of schemes which simplify the VAT system.

Scope and rates of value added tax

Short summary of what is chargeable for VAT in the UK, who constitutes a taxable person and how much tax is paid at different rates of VAT.

VAT administration, appeals and interest

A high level overview of the framework of VAT administration covering appeals and the interest charged on VAT recovered through the raising of an assessment.

Registration and de-registration

Briefly explains who has an obligation to register for VAT with a worked example for a small business. It also notes the pros and cons of voluntary VAT registration.

Recovery of VAT cross-border

This chapter explains the schemes for businesses recovering VAT incurred within the EU.

Exports

An overview of exporting from the UK. The chapter covers VAT treatment of direct and indirect exports, customs and excise, and the different types of export declaration.

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ICAEW Rep 62/18

ICAEW's Tax Faculty responds to the VAT registration threshold call for evidence published by HM Treasury on 13 March 2018.

ICAEW Rep 31/18

VAT Postponed accounting letter to FST

ICAEW REP 29/18

MTD - Interest harmonisation and sanctions for late payment

Useful links

Some resources that we link to may pre-date the latest amendments to the relevant tax regulations. While these links contain useful information, please treat them with appropriate caution.

Software suppliers supporting Making Tax Digital for VAT

List of companies who are supplying suitable software to support the MTD for VAT pilot. These suppliers have tested their products in HMRC's test environment and have already demonstrated a prototype of their software to HMRC.

VAT Notice 700/22: Making Tax Digital for VAT

Notice giving updated guidance on digital record keeping and return requirements of MTD for VAT. It explains the digital records that businesses must keep, ways to record transactions digitally in certain special circumstances, and what counts as ‘functional compatible software’.

KPMG Indirect tax rates table

Table from KPMG providing data on indirect tax rates around the world with brief accompanying notes. A separate interactive Tax rates tool allows you to compare tax rates by country or region.

VAT Information Exchange System (VIES)

Useful online tool for checking the validity of EU VAT numbers. The service is provided by the European Commission and uses data supplied by member states.

VAT on GOV.UK

Extensive collection of HMRC guidance on rates, thresholds, managing VAT and VAT returns. Contains specific guidance for builders, car dealers, importers and tour operators.

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Further support

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