VAT – Supporting you to reduce the VAT burden for your clients

When VAT was introduced in 1973 the Chancellor, Anthony Barber, described VAT as a “simple tax”. It may have been in concept, but the reality is that it has evolved into a mature and very complex tax. Legislation continually changes, whether as a result of HMRC's policies, in the Budget, or as a result of precedent created by High Court, Court of Appeal, House of Lords or European Court of Justice cases. HMRC’s interpretation of law also changes, sometimes announced in HMRC Briefs, Information Sheets and Public Notices. There are many instances where the guidance published by HMRC is unclear and puts the responsibility of interpretation on taxpayers and their advisers. An example of this can be found with the responsibility to disclose so called VAT avoidance schemes. HMRC have introduced listed schemes that must be disclosed, but left it to the taxpayer to declare structures that bear the “hallmarks” of avoidance. They have also introduced a voluntary facility for those who devise and market avoidance schemes. As you would expect, there are penalties for non-disclosure.

It is not surprising therefore, that taxpayers and accountants seek specialist VAT advice to help them identify pitfalls, take advantage of opportunities that arise and help them understand what HRMC may be thinking! Some of the services we can offer are as follows:

VAT services

Experience, quality of advice and value for money.

In our view, the experience of a team, the quality of advice and the value that the advice represents are the most important issues to consider when choosing a VAT consultant. We believe we can impress you on each of these points. SOC VAT consultants have each worked for a number of years in a top four and a top ten professional firm, and have served as VAT officers. Our experience of both the public and professional sector allows us to appreciate how best to advise clients and how to deal with HMRC when the need arises.

We advise both small to medium sized businesses and large multi-nationals. Whether your client is a start-up, international manufacturer and distributor, inward investment vehicle, technological industry, commercial property company, house-builder, international services company, housing association, charity or other not-for profit organisation, we believe that we can support you. Our aim, whichever the client, is to provide sound, prompt advice on complex matters in a way that can be easily understood.

The size of our organisation allows us to provide a focused personal service at a fraction of the cost of a large firm.
 

Being compliant

There are a number of demands on a business to keep records of transactions, supported by appropriate invoices, agreements, and evidence of delivery etc, in order to comply with HMRC’s requirements. A simple failure to abide by the regulations could result in an assessment, penalties and interest for the client or even the possibility of criminal prosecution for failing to submit Intrastat declarations.

We can help you ensure your clients understand what is required of them and implement systems and due diligence checks appropriately. We can also liaise with HMRC officers in order to confirm the VAT treatment of supplies by and to the business, and attend inspections if you so wish.

Minimising the VAT cost

All businesses have a VAT cost, whether incurred in connection with their exempt or non-business activities or simply VAT relating to business entertaining.

We can assist your clients in identifying ways of reducing the VAT cost to their business where possible, or managing cash flow appropriately. We would consider issues such as partial exemption and business/non-business methods and whether the accounting system is efficient and identifying recoverable VAT at the optimum time. We would also look at VAT-group structures to see if VAT costs could be mitigated, or if there are ways to improve cash flow.

Dealing with HM Customs & Excise

We appreciate that dealing with VAT officers can be a daunting and frustrating experience for some businesses. There is always the worry that your client might not say or write the right thing and that this could lead to an assessment or decision that cannot be relied upon.

We understand HMRC very well and specialise in negotiating matters with them, whether a VAT liability question, an officer’s inspection, or managing an appeal against a decision through the relevant court procedures. We have undertaken successful Tribunal appeals for clients. Another service we can offer is to undertake a pre-VAT inspection check of the client in order to identify issues that can be voluntarily disclosed to an officer in order to avoid a possible misdeclaration penalty.

Land and property deals

Land and property deals involve significant amounts of VAT and hence the potential for a significant cost if legislation is not interpreted correctly. However, these transactions can also provide the opportunity for substantial savings.

We regularly review land and property deals to confirm the treatment is correct. For example, we often assist in respect of construction projects for not-for-profit organisations where VAT is to be charged by the contractor and identify that some or all of the works can be VAT free. Another area that is often overlooked when considering such transactions, is the application of the transfer of a going concern provisions.

International services and supplies of goods

Supplies of services and goods between EU countries and EU and non-EU countries can be complex. For example, the supply and installation of goods has a different treatment to a straightforward supply of goods from one country to another. Some transactions can give rise to an exposure to register for VAT in other countries.

We can provide advice on the treatment of international transactions, alternative structures if available to mitigate any exposure and assist with any registration requirement.

Training courses

One of the most successful ways of identifying VAT issues and saving opportunities is by training staff.

We can devise and deliver introductory courses and also bespoke courses tailored to suit your clients’ needs. Courses can be structured to include basic VAT refreshers, areas of technical difficulty according to the business sector, and even a section on handling VAT inspections. Our courses are designed to be interactive and we have received very positive feedback from attendees.

VAT health check

Your clients may feel that they require comfort from a VAT specialist with HMRC experience that they are HMRC-compliant.

We offer health checks that look at specific transactions or areas of trade, or checks that cover all issues of the business. The health checks are a very good way of us not only identifying opportunities to save money, but reducing the risk of penalties.

Helpline service

Given that HMRC will not always give the most favourable answer to enquiries, we offer a Helpline service that you and your clients can use. We would ordinarily not make a charge for initial quick queries so to encourage issues to be identified. Any work requiring assistance as a result of the telephone conversation would be agreed with you or your client (including an estimate of fees).

Specialist areas

Although we are able to offer advice for any client issue, we specialise in the following areas:

charities and not-for-profit companies;
registered social landlords; 
universities, colleges and independent schools;
land and property companies;
international goods and services businesses; and
appeals against HMRC decisions.