VAT & Indirect Taxes


Key points:

  •  VAT registration threshold to increase to £83,000

From 1 April 2016 the VAT registration threshold will increase to £83,000, with the deregistration threshold also rising to £81,000.

Key points:

  •  Overseas businesses targeted for online marketplace VAT fraud

The Chancellor has announced today that HMRC will be introducing measures to tackle the increasing VAT evasion from the online marketplace.

The VAT legislation states that if an overseas supplier makes a sale to a UK consumer of goods already located in the UK at the point of sale, UK VAT will be payable on these supplies.

It has become evident that overseas businesses are storing goods in the UK prior to making these sales to the end consumer, but are not accounting for UK VAT on their sales.  This allows them to undercut UK businesses.

The new measures introduced will not apply automatically to all overseas businesses, but allows HMRC powers to target the most non-compliant overseas businesses on a case by case basis.

Where the overseas business continues to be non-compliant HMRC will now have the power to hold the online marketplace (such as Amazon or EBay) jointly and severally liable for any VAT due.


Fuel Duty

Key points:

  •   Fuel duty frozen for the sixth year in a row

The government has confirmed that for a sixth year in a row there will be no increase in fuel duty.  It is estimated by the Chancellor that this means a yearly saving for the average driver of £75.


Insurance Premium Tax

Key points:

  •   Increased revenue to be used to go towards flood defences.
  •   IPT to be increased by 0.5% .

From 1 October 2016 the standard rate of IPT will increase from 9.5% to 10%.  The additional money received from this increase will be spent on funding flood defences, with new projects announced in Cumbria and Yorkshire.


Landfill Tax

Key points:

  •   Landfill Tax rates to increase year on year.

The standard rate of Landfill Tax will increase to £84.40/tonne on 1 April 2016, then up to £86.10/tonne on 1 April 2017 before increasing to £88.95/tonne from 1 April 2018.

The lower rate will increase from £2.65/tonne to £2.70/tonne to £2.80/tonne over the same time period.

These increases are in line with the Retail Price Index.

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