Companies in four-day VAT reduction race

Companies given only four full working days to change their systems to cater
for the reduction in VAT are rushing through IT changes in order to make the
deadline.

Businesses have been scrambling to get themselves ready after VAT was reduced
from 17.5% to 15% in the pre Budget report.

Software vendors have been on standby to deal with calls from clients who are
unsure how to change the settings on their software and unwilling to take a
chance as the deadline looms.

Dennis Keeling, chief executive of Business Software Intelligence said: ‘It
isn’t straight forward changing VAT. Accountants’ phones will be ringing off the
hook with people trying to find out how to do it.’

‘Software that has been built bespoke may not have the ability to change
quickly which could add further problems’ he added.

Other software vendors are anticipating that certain mistakes will creep into
accounting due to the time constraints.

Kevin McCallum, commercial director at Pegasus said: ‘The HMRC documentation
given is not entirely clear and could be open to mistakes. These will probably
have to be swept under the table for the greater good due to the scale of
changes having to be implemented in such a short space of time.’