mackthefork
Blogger
Share this content
0
6
1306

VAT penalty

VAT penalty

My VAT return was filed on 30th of the month, I use flat rate VAT and my accountant prepares the return, on the 10th of the following month I realised there was an error on the return and VAT of over £1,000 had not been claimed on an asset, I cancelled my Direct Debit and paid the correct amount by electronic transfer the following day (one day before the DD would have left my account), the same day a correction was filed.

EDIT: About a week later HMRC issued a penalty which has been appealed against as it was on a technicality.

As HMRC got their money on or before the date they would have and there was no intent to make a cahflow benefit I cannot see a problem, what do you think of my chances?

Regards

MtF

Replies

Please login or register to join the discussion.

25th May 2012 09:01

Right

I assume you mean the 30th of the month after your quarter end.

Have you actually got a penalty for paying your VAT as you say? 

Why was your payment being made after the 7th of the month (I feel I'm missing something there)?

Thanks (0)
avatar
JRVA
25th May 2012 23:17

Direct Debit you get extra days

Constantly Confused wrote:

I assume you mean the 30th of the month after your quarter end.

Have you actually got a penalty for paying your VAT as you say? 

Why was your payment being made after the 7th of the month (I feel I'm missing something there)?

 

Hello payment is usually due on the 7th but if you pay by DD the date is the 12th.  The return was incorrect and would have caused undue suffering had I left it, I feel that as I made sure the payment was made before the date I would have paid (11th) I should not be penalised.  As suggested by the other poster I have had problems in the past, my new accountant has got me on the right track and this would have been the start of a clean slate for me, however i got a 10% penalty for an honest mistake which hurt no-one IMHO.

Regards

MtF

Thanks (0)
avatar
By DMGbus
graweb901
27th May 2012 12:33

DD date clarification

mackthefork wrote:

Constantly Confused wrote:

I assume you mean the 30th of the month after your quarter end.

Have you actually got a penalty for paying your VAT as you say? 

Why was your payment being made after the 7th of the month (I feel I'm missing something there)?

 

Hello payment is usually due on the 7th but if you pay by DD the date is the 12th.  The return was incorrect and would have caused undue suffering had I left it, I feel that as I made sure the payment was made before the date I would have paid (11th) I should not be penalised.  As suggested by the other poster I have had problems in the past, my new accountant has got me on the right track and this would have been the start of a clean slate for me, however i got a 10% penalty for an honest mistake which hurt no-one IMHO.

Regards

MtF

 

The standard direct debit claim date is 10th (as opposed to clear funds with HMRC by the 7th for other payment dates).

As it happens sometimes the actual DD date will be the 11th or 12th depending on how non-bank-working-days fall.

 

 

Thanks (0)
avatar
Kent accountant
27th May 2012 22:43

Correct

DMGbus wrote:

mackthefork wrote:

Constantly Confused wrote:

I assume you mean the 30th of the month after your quarter end.

Have you actually got a penalty for paying your VAT as you say? 

Why was your payment being made after the 7th of the month (I feel I'm missing something there)?

 

Hello payment is usually due on the 7th but if you pay by DD the date is the 12th.  The return was incorrect and would have caused undue suffering had I left it, I feel that as I made sure the payment was made before the date I would have paid (11th) I should not be penalised.  As suggested by the other poster I have had problems in the past, my new accountant has got me on the right track and this would have been the start of a clean slate for me, however i got a 10% penalty for an honest mistake which hurt no-one IMHO.

Regards

MtF

 

The standard direct debit claim date is 10th (as opposed to clear funds with HMRC by the 7th for other payment dates).

As it happens sometimes the actual DD date will be the 11th or 12th depending on how non-bank-working-days fall.

 

 

 

You are right I am mistaken in this, for example this year it will be on the 10th - 4 times and on the 11th or 12th - 8 times, not much of a standard but what you say is true.

Regards

MtF

Thanks (0)
25th May 2012 10:28

Cancellation of DD

If you or your accountant on your behalf has set up a DD authority through the VAT Online service to pay your VAT, then filing the return online will automatically generate the DD payment.  If you then cancelled the DD by contacting your bank, HMRC would be unaware and would still have tried to collect the DD and would have concluded that you had defaulted on your VAT payment.  I would think this is the reason for them charging a penalty.

However, you would already have to be on a default surcharge notice for filing or paying late within the previous 12 months for them to impose a surcharge on this occasion.  Have a look at the HMRC guidance.

Thanks (0)
28th May 2012 09:17

You live
and learn!

I didn't know there was a DD extension to the payment date, though presumably it has to be in place 3 days prior, so the 7/8/9th of the month?

Thanks (0)