Client breached the vat threshold

Grocery business so 0% output vat so no debt towards HMRC but what's the penalty?

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I recently signed up a new groceries distributor (0% output vat) client who registered for vat just a couple of months ago. While doing their first return I found out that the quarterly turnover was greater than the 83k threshold! I don't think that it suddenly shot up last quarter so have requested last 9 months of the bank. statements to find out when did they went over the threshold as last year's total turnover was 80k only.

As they are in food distribution business they will be receiving vat refund on expenses.

My question is what is the panelty for them in this situation? 

Replies (9)

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By Duggimon
20th Aug 2018 10:32

The failure to notify penalties are based on the potential lost revenue. Since it is your client who has lost revenue and not HMRC, HMRC ought to pay your client the penalty.

See if you can dress it up as a deliberate and concealed error and prompt HMRC to disclose it, should maximise the amount your client receives.

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Replying to Duggimon:
RLI
By lionofludesch
20th Aug 2018 10:36

Arf arf.

Yes the client's in the clear, though I'd be wary of assuming everything is zero rated.

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By thevaliant
20th Aug 2018 12:32

There is no penalty (as the penalty is based on a percentage of what the VAT payable is - as there is a VAT refund, it's £nil). HMRC seem never too bothered to do anything about it.

I have a fishmonger as a client. To say their records are poor is an understatement. Last year I brought their VAT up to date, finally filing the 2012 to 2017 VAT returns online.

Nothing happened, nothing has happened and HMRC paid the few thousand pounds I reclaimed back without a murmur.

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Replying to thevaliant:
RLI
By lionofludesch
20th Aug 2018 12:42

Quote:

I have a fishmonger as a client.

What is "monging" exactly ?

Why can you only mong fish, cheese, iron, rumours and gossip ?

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Replying to lionofludesch:
By ireallyshouldknowthisbut
20th Aug 2018 12:49

"monging" can mean any specialised dealer or trader, but its got to be 'stuff' I don't think you can be an taxreturnmonger.

Costermonger is someone who sells fruit and veg. Got some of them in the english leg of the family just before the durham coal miners.

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Replying to ireallyshouldknowthisbut:
RLI
By lionofludesch
20th Aug 2018 12:53

Quote:

"monging" can mean any specialised dealer or trader, but its got to be 'stuff' I don't think you can be an taxreturnmonger.

Costermonger is someone who sells fruit and veg. Got some of them in the english leg of the family just before the durham coal miners.

Ah yes - I'd forgotten costers, though I thought they did coffee.

What about chandling ? Only for ships ?

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Replying to lionofludesch:
paddle steamer
By DJKL
20th Aug 2018 13:00

A quick google just brought up a somewhat disturbing image re "Chandle" in the Urban Dictoniary, the second definition appears somewhat graphic!!

https://www.urbandictionary.com/define.php?term=chandle

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Replying to lionofludesch:
paddle steamer
By DJKL
20th Aug 2018 13:10

Just looked it up, it appears it originally was related to candles and then its meaning morphed to general household goods and then one got ship's chandler to distinguish from a general chandler which latter appears to have stopped being so described.

One of the more interesting sets of accounts and audits I ever worked on was a company of Chandlers, Coal Merchants and General Stevedores in Stornoway. Multi faceted activities were interesting as was the view from the office over the jetties and peers of the outer harbour.

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By Pygmy
20th Aug 2018 15:05

Coalmongers? Scandalmongers? hatemongers (apparently)

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