Categorized | news

Taxman lauded for changes to its digital VAT approach

It’s a Christmas miracle: Her Majesty’s Revenue & Customs has been given high praise for finally changing its approach to VAT for digital firms.

The Chartered Institute of Taxation, a group of blokes that definitely know what they’re talking about when it comes to VAT, corporation tax, and all other sorts of ways the Treasury fills its coffers, offered high praise to HMRC, recently stating that an untold number of firms that need to register digital service European VAT will save thousands of pounds under the tax authority’s new rules. Now, any of these firms won’t have to charge British customers VAT rates as long as they don’t go over an £81,000 turnover threshold. This new threshold is highly likely to include all sorts of sole traders like contractors and other self-employed people, so that’s just brilliant news if you ask me.

The regulations, comically known as the VAT Mini One Stop Shop, have thankfully been amended to exempt anyone under that threshold in the UK, where it previously covered absolutely everyone. CIOT says that it’s likely there will be something like 34,000 firms – almost all of them smaller operations – exempt from having to deal with VAT in the UK now as a result. That’s a serious boon for the economy, as now these small firms and little outfits like contractors and other self-employed sole traders can keep more of their cash and not have to say goodbye to so much of their revenue being sucked off into the ether through VAT. The trade industry body called a ‘common sense approach’ to European VAT, and I have to agree wholeheartedly.

Of course there are some that will argue that the exemption amount needs to be raised. Bollocks to that I say; if you’re making that much money then you can afford to pay UK VAT as far as I’m concerned. This is all about providing more support to small businesses here at home and we absolutely must do everything in our power to do so. It’s the best way to grow our economy here at home, and that’ll have a wonderful knock-on effect for the global economy as well; any VAT revenue we lose from the new threshold is so minimal as to be practically nonexistent anyway, if you ask me!

Be Sociable, Share!

More on this topic: Tags: , , ,

Print This Post

Leave a Reply

You must be logged in to post a comment.

  • Switch Accountants for FREE

    Switch Accountants for FREEAt K&B Accountancy Group we have introduced a simple and straightforward approach to changing accountants. We’re offering contractors, consultants and freelancers the opportunity to switch to K&B Accountancy Group for FREE without the need to pay for any ‘catch up’ or retrospective accountancy fees for the previous year’s accounts and corporation tax return* *T&Cs apply

our top 5 twitter posts


contractor accountants


twitter Join the conversation
Free Telephone Advice