I have a new client (LTD) who had completed their own company accounts and VAT returns. Upon getting to know the client further I have noticed that the client has been charging VAT on all the company’s rental income (for a while) and subsequently recovering the input VAT. The client has not exercised their option to tax against any of these commercial buildings. All the rent relates to commercial buildings.
The client has paid the net VAT over to HMRC each quarter.
Net error will be over £10K.
What would the steps be? Am I right in thinking it would be to disclose this to HMRC (with client permission) via VAT652 and then potentially try a belated opt to tax claim?
I am open to any suggestions.
Any help will be greatly appreciated.