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VAT
Our specialist team understands VAT, a notoriously complicated tax governed by rules that can appear opaque to even the most confident commentator on tax matters.
We advise on all aspects of VAT, including property deals and construction work, reorganisations and business sales, cross-border trade, hotels, aircraft/yachts, HMRC inspections, Tribunal appeals, financial services and so on. It has been a period of change for businesses and that has included VAT.
The UK’s departure from the EU in January 2021 has added another layer of VAT-related difficulty, particularly for those importing goods into the UK - not made any easier by the fact that Northern Ireland is now operating as a unique VAT jurisdiction.
In addition, the construction sector has had to get to grips with significant changes, introduced on 1 March 2021, to the way in which VAT is accounted for within the construction supply chain.
The EU’s new One Stop Shop rules have also been troubling UK exporters, with changes entering into force on 1 July 2021.
Our experience means we will provide clear, practical VAT advice to all organisations, individuals and professional advisers to help them navigate the complexities and opportunities thrown up by this awkward tax. We can help you deal with all VAT-related issues including VAT planning, registering for VAT, HMRC investigations, maximising VAT opportunities and reliefs and mitigating VAT penalties.
Our expertise
VAT planning
How do you address VAT issues for your projects?
With VAT experience stretching back decades, we can respond to occasional queries or we can help shape a project efficiently for VAT.
Example: One of our team helped a property developer mitigate an unexpected £180,000 VAT liability on a new public building that he was required to construct after having bought a publicly-owned property in order to use the land for a new housing development. We have also helped businesses and entrepreneurs when purchasing aircraft and yachts, helping one save $10m in VAT.
HMRC investigations and reviews
These can be daunting for even the most experienced business. We will help you every step of the way, regardless of whether the investigation is routine or has more serious implications.
Example: One of our specialists successfully helped a construction firm to resolve several HMRC VAT-related enquiries relating to a number of complex multi-million pound projects. We have helped numerous businesses facing HMRC VAT inspections, including specific HMRC challenges appealed to Tribunal.
"Kevin Hall is a highly professional individual who proved to be extremely effective throughout the West Midlands EU Transition project. He brought extensive knowledge and insight to the VAT related problems businesses were facing, in light of EU Transition, and helped streamline the business support process."
VAT opportunities and due diligence
Regular reviews of your VAT obligations can often reveal opportunities for saving money and avoiding pitfalls, if you know where to look – which our team does.
Example: A member of our VAT team saved millions of pounds for both buyers and sellers of businesses by recovering input tax as fully as possible and ensuring that VAT liabilities were not created unnecessarily when a business is bought or sold. This has also involved resolving VAT risks.
Case studies
HMRC insisted that an individual register for VAT, but we successfully argued they were entitled to an exception from VAT registration.
Read case studyThe VAT margin scheme increases profits for qualifying businesses.
Read case studyVAT penalties and disputes
The prospect of facing a VAT-related penalty can cause great anxiety. Our team has considerable experience in negotiating with HMRC to reduce or even abolish the penalty.
Example: One of our team helped a recruitment business avoid paying a £54m VAT liability by working closely with HMRC which resulted in the business avoiding the VAT risk. In another case, we successfully defended a hotel against a charge that it had reduced its VAT by too much for long-stay guests. HMRC conceded on the steps of the Tribunal.
Registering for VAT
We will help you to comply with all the rules around registration – for instance, when you need to register, whether you need to register and the recovery of VAT on pre-registration costs.
Example: we regularly answer queries from small companies on flat-rate schemes, disaggregated businesses, VAT registration threshold issues and so on.
Our recent experience
- We assisted a UK PLC ($6 billion worldwide capitalisation) with its cross-border supplies, including successfully resolving HMRC investigations and reducing its UK VAT liabilities. The saving in UK VAT has been millions of pounds each year.
- We steered a client away from a significant VAT bill on a £30m property development project and into a safe position. We acted under high time pressure, but our advice enabled the project to proceed on time.
- Wright Hassall has assisted the government to provide post-Brexit VAT advice to numerous small and medium sized enterprises throughout the West Midlands, from those below the VAT registration limit to multi-million pound international businesses.
- Businesses using the VAT margin scheme to trade in second-hand items, works of art, antiques or collectibles have been hard hit by the Brexit changes. This affects businesses with all levels of turnover, who trade with the EU or Northern Ireland. There are some solutions and we have successfully advised many businesses who have been able to adapt and save their enterprises.
- Online trading has increasingly become the target of anti-avoidance rules over the years. While this is necessary, it has meant higher and higher burdens. We supported an online platform in its evolution to address these new rules and take on itself the pressures faced by the online traders using its platform.