VAT (Revision notes)

Question 1

Goods/Assets & Services

Pre-registration input tax

Answer 1

Goods/Assets were bought in the last 4 years

Services incurred in 6 months before reg

Question 2

2 types

Types of tests, when to inform and when reg applies

Answer 2

Historical - compulsory is taxable supplies in previous 12 months or less > £85,000.

Must inform within EOM+30 days of breach

Reg applies from start of the month, one month after limit breached.

Future - Trader liable to register if he anticipates turnover exceeding £85k

30 days to inform HMRC

Reg from day 1 of the 30 day period

Question 3

Group Reg

Answer 3

2 or more companies, with business in the UK, under common control can apply

Representative member (i.e. on return for the group)

Intra-group transfers are disregarded for VAT purposes

Can exclude companies from group

Question 4

Default surcharges

Answer 4

Penalties go from 2%, to 5%, to 10%, to 15% every time the taxpayer is late within the default
notice period