HMRC has not sent copy of the letter to the trader’s tax agent and so accountants will not be aware their client may have received the VAT related letter. It is important that the letter is copied to the accountant as soon as possible, as the adviser can assist with mitigating penalties should the registration deadline have been missed.
What are the rules?
A business is required to register for VAT once its historic taxable turnover for the previous 12 months exceeds £85,000, or if it expects its future taxable turnover in the next 30 days alone will exceed £85,000. Exempt sales, such as land or insurance, do not count towards these thresholds. However, zero-rated sales, such as books and children’s clothing, and reduced-rated sales, such as alterations to houses, do count.
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