Carousel_Arrow Chat icon_cookie IHT_trust_wills IR35 Combined Shape 2 Group 10 Login Mobile Menu Share Share Email SubMenuMobile Group 9 VAT View_Gallery View_List capital_allow Triangle 2 Copy Close construction cyberpro employment_tax_shares emplyer_solutions entrepreneurs_corps fee_protect Group 7 grant_fund Group i_Clock i_Consult i_Done i_Eligibility_Tick i_Enter i_Filter i_HMRC i_Negative i_Play i_Plus i_Reset i_Support_Legal i_Support_TaxDesk i_Support_VAT i_Tick noun_marketing_1872083 noun_online_2126759 i_download i_meet Group Copy 24 Group 18 noun_electrical_1240755 copy noun_Technology_2125422 noun_Science_2031115 i_tick_bullet_block international_tax patent_box private_client property_sdlt r_and_d reliefs_incentives Search specialist_tax status tax_indemnity valuation YouTube
Markel Tax

22 Nov 2017

Autumn Budget 2017: VAT split payment for online payments

VAT charged in respect of online supplies is collected by the supplier, held and paid to HMRC at regular intervals (eg after a quarterly VAT return is submitted to HMRC).

A call for evidence was launched on 20 March 2017 after the Spring Budget 2017 to develop a “split payment” model for the online supply of goods. The intention is that the VAT paid by customers will be collected in real time and is part of the government’s strategy to combat VAT fraud in online supplies.

On 1 December 2017, the government will publish a response document to the call for evidence.

It should come as no surprise that the responses highlighted the complexities of implementation and the government will set out plans in the response document for further engagement with external stakeholders, in preparation for a full consultation in 2018.

The government loses a large amount of VAT every year through fraud in online sales of goods. It is taking steps to clamp down on this fraud, and suppliers of goods through online sales are being heavily targeted.

If the government can overcome the significant practical issues, such suppliers will find that their receipts from customers will be reduced by the VAT element.

Tagged Value added tax (VAT) services
Next article in series

22 Nov 2017

Autumn Budget 2017: Master trust tax registration