Replies (5)
Please login or register to join the discussion.
.
I think HMRC published the number of sign ups recently. It was tiny.
Most of our affected clients having been explained the options, ie do this with the certainty of time and cost, but doing it right, or wait and see what happens if they dont, ie risk the uncertainty of enforcement action, have chosen the latter as the sums have been small.
The real action on this will be in 2-3 years time when we know what - if any - compliance action there will be on the legislation.
If none, then it will be another voluntary rule which is widely flouted to add to the many other widely flouted rules that exist.
Yep 3 options
1, Ignore - there is no enforcement anyway - there is general non compliance in most other areas anyway.
2, Don't trade with europe - that seems to be what the government want.
3, try and comply, fail miserably incur massive accountancy fees and horrendous IT fees then mahoosive tax penalties. (ltd company then bust will work very well here)
If they wanted to stop amazon they should have a size criteria for these complicated rules otherwise it's only the likes of amazon that can afford it. A bit of extra tax for amazon will be good if it takes out all the competition and the government will still provide tax efficient distribution centres for them in the UK.
Hold it a minute
I was asked for comments by Nick on Friday 4 September and gave him details of the facebook pages of the EU VAT action campaign. I have just discovered that he has posted this piece including the statement "EU VAT Action didn’t respond to a request for an interview". This is outrageous - these are very small businesses trying to balance their own demands, the demands of the VATMOSS system, and attempts to persuade the EU to moderate the rules, to accommodate small businesses who face real problems. One of the leading lights on the campaign, Clara Josa who I mentioned to Nick is today on her way to Dublin to present information and make representations to a council of ministers meeting. I can understand that she may have had no time on Friday to provide Nick with comments for a fairly sloppy piece. When he spoke to me he had very little idea of what the problem was. In support of his question "But are campaigners exaggerating the problems caused by the new VAT rules?" he quotes an old article by Les Howard which I think even Les would now agree ignored the very real problems faced by businesses too small to survive under threat posed by this ill-considered piece of EU nonsense.
Articles like this just don't help - a realistic de minimis limit, which is what EU VAT Action are seeking - would ensure that the issue of compliance (or indeed non-compliance as is probably what is actually happening) is no longer a problem until a business grows to a size where it can realistically meet these demands for information. We are talking about people creating things like downloadable knitting patterns who are recording VATMOSS liabilities as little as 67p. And yet only a couple of weeks the Irish Tax Authorities issued demands to some of these traders for 5 and 6 figure amounts - undoubtedly a 'mistake' of course but illustrative of how this nonsense not only affects small business but also tax authorities who seem equally unable to cope! This is typical a Dutch trader sells ebooks to an Irish customer and has a liability for the first quarter of €12 - then receives a demand from the Irish for over €3million! http://www.irishtimes.com/business/revenue-sends-out-vat-demands-to-over...
I told Nick about this problem and 30 seconds research through Google would turn up a wealth of stories. This is shoddy journalism. But all he can do is whinge that someone "didn't respond" - nor would I have spent 15 minutes talking to the young man had I known what would result.
.
@Paul, well done on your for campaign for the blatently obvious answer, certainty in the form of a sensible limit, rather than leaving tax payers to make up their own limit of the amount they think they can get away with before anyone will notice.
This is not a good state of affairs.
My logic goes something like compliance is a function of effort being lower than less than risk times likely penalties. That is to say if it costs your £500 a year to comply with a rule, but the risk of non-compliance is £100 and the risk 10% per annum, it is not worth complying, you just pay the fines.
Misquoted
I do not think that campaigners have over-stated the problems caused by VATMOSS. Many micro-businesses have felt obliged to change what they offer or, in a number of cases, close down altogether. I have met a number.
A minimum registration threshold is a good idea, although my own view is that the current VAT registration threshold of £82,000 is too high.
And, I wish Rosie Slosek well as she fights the corner for many.