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UK VAT changes

Summary of VAT changes announced in the 2015 UK Budget

Ryan Bevan 24 January 2016 No comments

 

Five VAT changes were announced in today’s Budget.

1: Changes to partial exemption calculations for businesses with foreign branches.
Supplies made by foreign branches will no longer be taken into account when a partially exempt business calculates the amount of VAT it can recover on overhead costs.

This will reduce the amount of VAT recovery allowed to partially exempt businesses, such as banks and insurance companies, with overseas branches. This is intended to be implemented from 1 August 2015.

For further information on this change see the HMRC Budget announcement https://www.gov.uk/government/publications/vat-deductions-relating-to-foreign-branches.

2: New refund scheme for palliative care charities
Palliative care charities will be able to recover VAT incurred on purchases relating to their non-business activities.

This was previously announced in the Autumn Statement 2014. This will come into effect for supplies, acquisitions and importations taking place from 1 April 2015.

For further information on this change see the HMRC Budget announcement https://www.gov.uk/government/publications/vat-refunds-for-palliative-care-charities.

3: New refund scheme for medical courier charities
Medical courier charities, such as blood bikes, will be able to recover VAT incurred on purchases relating to their non-business activities.

This will come into effect for supplies, acquisitions and importations taking place from 1 April 2015.

For further information on this change see the HMRC Budget announcement https://www.gov.uk/government/publications/vat-refunds-to-medical-courier-charities.

Full details of all announcements made in the Budget can be found on HMRC’s website at https://www.gov.uk/government/collections/budget-2015-hm-revenue-and-customs.

4: VAT Registration Threshold Increases
The UK VAT registration threshold increases from £81,000 to £82,000.

5: VAT De-registration Threshold Increases
The UK VAT de-registration threshold increases from £79,000 to £80,000.

For more information on any of these topics or VAT changes in 2015, please get in touch.