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VAT: Group registration delays

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HMRC recently confirmed with ICAEW that there are significant delays in processing VAT group applications. Jason Croke looks at the practical issues. 

28th Jan 2022
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  Throughout January 2022 HMRC has been dealing with VAT group applications received in July 2021. There was no indication as to how quickly the backlog is being dealt with, but HMRC has noted previously that the aim is to clear all backlogs by the end of March 2022.

VAT Groups
VAT grouping is a method in which two or more eligible persons can be treated as a single taxable person for VAT purposes. Eligible persons are bodies corporate (limited companies, LLPs), individuals, partnerships and Scottish partnerships, provided that certain conditions are satisfied.  The main conditions are that each eligible person is established in the UK and that they are under common control.

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Replies (3)

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By D V Fields
28th Jan 2022 19:08

When you say that “HMRC’s guidance is clear” on what basis do you make that claim please?

The guidance at 2.18 suggest that if your application is rejected but you had submitted returns as though a member had joined then this would need to be corrected. The guidance also refers to “provisionally being treated as a member of a VAT Group” although I have not seen the criterion for this, but might presume it means “applied and waiting to hear.”

These sentences seem to suggest otherwise. I have a situation coming up where the long delayed approval (well over 90 days) is about to hit home! Therefore interested in your source.

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VAT
By Jason Croke
29th Jan 2022 16:12

Link here https://www.att.org.uk/technical/news/vat-grouping-registration-delays-h...

Same again but different source here https://www.tax.org.uk/vat-repayment-interest-change-welcome-but-concern...

My original draft article did have the links but I can see they've not ended up in the final published article.

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Replying to Jason Croke:
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By D V Fields
23rd Apr 2022 18:02

Update from 2 March 2022:

https://www.gov.uk/government/publications/revenue-and-customs-brief-5-2...

If I have understood this correctly HMRC have now reverted back to the law
s43B(4) VATA 1994.

Alas, so much for their original clear guidance.

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