In connection with the reversion of the standard rate of VAT to 17.5% from 1 January 2010, anti-avoidance legislation1 was introduced to prevent forestalling. The legislation provides that a supplementary VAT charge of 2.5% will apply where the customer cannot recover all the VAT on the supply and:
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•ÌýÌýÌýÌý the supplier and the customer are connected parties
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•ÌýÌýÌýÌý the supplier funds the purchase of the goods or services (or the grant of the right to receive them), and
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•ÌýÌýÌýÌý a VAT invoice is issued by the supplier, where payment is not due for at least six months
The supplementary charge also applies where a pre-payment of more than £100,000 is made before the increase in the rate of VAT in connection with goods or services (or the grant of a right to receive
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Web page updated on 24 Aug 2024 13:11