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VAT has a very widespread impact on consumers as it applies to so many goods and services. It is of interest to note that with the shift away from the strategy of direct taxation towards indirect taxation, VAT has risen by way of compensation. This cost to the individual is hard to assess but between 1973 when VAT was first introduced into the UK and 2003, it garnered £828 billion for the Exchequer.
It can be argued that latterly the main rate of VAT has not varied significantly however the range of items subject to VAT has risen virtually annually.
Although UK VAT remains low when compared to the rest of the EU it is the complexity of the system which causes most problems for businesses and those who wrongly assess their liabilities or miss deadlines suffer penalties for so doing.
Within the new penalty regime which came into effect on 1 April 2009 and covers all taxes, HM Revenue and Customs details three categories of inaccuracy. These are significant, as each has its own range of penalty percentages. If an inaccuracy is found to fall within a lower band, then a lower penalty rate will apply. Where the taxpayer has taken ‘reasonable care’’ even though an error has been made, then no penalty will apply.
To enable you to identify the areas where you are at greatest risk of making errors, we have developed a questionnaire which, when completed, will enable us to assist you in understanding your potential risk areas, putting you in a position to manage them. In the first instance we would request that you complete the following questionnaire as a first step towards assessing and managing your VAT risk. Our dedicated VAT team will then review the questionnaire and forward your FREE VAT Risk Profile Report and contact you to discuss the potential risk areas identified from the answers provided. The information which you provide in the questionnaire is for the sole purpose stated above.
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