Smaller businesses which have not previously been able to recover VAT borne in the EU will benefit from a change to commence on 1 January 2010.
As part of an EU simplification measure, the process for reclaiming VAT incurred in other member states will be significantly streamlined, with claims made electronically, rather than on paper, and submitted to the home tax authority in the UK this is HMRC.
So the convoluted process applying before under which many small businesses gave up the unequal effort to recover input tax borne abroad comes to an end. Probably the only ones sad to see it go are those who have made a business by handling these claims for a fee.
The main changes from the paper-based system are:
- Businesses have longer to submit their claims, with a time limit of nine month...