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UK Spring Budget 2017 – VAT Implications

The UK Chancellor delivered his Spring Budget yesterday.  Affecting online sellers are the following:

UK Established Companies

  • VAT Registration and deregistration thresholds – From 1 April 2017 the VAT registration threshold will increase from £83,000 to £85,000 and the deregistration threshold from £81,000 to £83,000.   This means, from April 1st 2017, if you are a UK established business you will not have to VAT register until your turnover reaches £85,000 in a rolling 12 month period.

 

Overseas Sellers UK VAT Fraud Counter-Measures

  • ‘Split Payment’ model – In the next step in tackling the non-payment of VAT by some overseas traders selling goods online to UK consumers and building on the measures introduced in Budget 2016, the government will shortly publish a call for evidence on the case for a new VAT collection mechanism for online sales. This would harness technology to allow VAT to be extracted directly by the Exchequer from online transactions at the point of purchase.

 

2 COMMENTS
  1. chris 2 weeks ago

    I joined the scheme in Dec 2000 when the registration threshold was a lot lower than it’s today. However, last year I grossed around 72k. I am wondered is there any need for me to still continue to be vat registered?

    Reply
    • simplyvat.com 1 week ago

      If you are sure you will not exceed the new threshold of £85,000 in the short/ medium term, HMRC should let you deregister. Please remember, you will not then be able to reclaim any VAT on purchases you make.

      Reply

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