VAT Rulings
We are increasingly discovering that HMRC respond to a request for a VAT ruling by stating that a ruling is not required as the matter is covered by publicly available guidance. In this case, the business may submit another request for a ruling (if any different points may be raised), or otherwise it will need to ensure that the decision it makes is suitably documented in the event that HMRC deem it to be incorrect. This may involve taking advice externally, submitting a detailed Error Correction Notification or otherwise disclosing full facts to HMRC.
Late payment of VAT
Taxpayers must be aware of the costly consequence of making a VAT return payment late if they are under the default surcharge regime. The court has upheld a surcharge in excess of £70,000 levied on Trinity Mirror in respect of making its VAT payment just one day late. Whilst the Tribunal ruled that the surcharge was disproportionate, the Upper Tier Tribunal has over turned the decision, making the surcharge payable.
Offshore tax – civil & criminal penalties
HMRC’s current consultation document on offshore tax evasion goes even further than before. If 200% penalties wasn’t already enough HMRC are looking at a strict criminal offence. Advisers and taxpayers need to be very aware that HMRC really is clamping down. The Liechtenstein Disclosure Facility (“LDF”) also closes to registrations on 31 December 2015 – the last chance for favourable disclosures to HMRC.