Directors in dark over VAT rules
Just 14% of tax directors understand new guidance on disclosure rules for VAT avoidance.
Link: Tougher penalties needed to fight VAT fraud
The findings from Big Four firm Deloitte highlight a worrying lack of readiness among UK companies to a regime that could result in serious dents to reputation, should they fall foul of the rules.
Under the Customs & Excise system, businesses with a turnover in excess of £600,000 must disclose if they have any of eight listed schemes. Businesses with a turnover in excess of £10m must also disclose any tax-planning arrangements bearing one of Customs’ ‘hallmarks of avoidance’.
‘The introduction of rules for VAT avoidance schemes is an issue that most medium-to-large UK businesses need to consider immediately,’ said Dennis Knowles, indirect tax partner at Deloitte. He warned that there could be ‘significant reputational damage for those that are unprepared’.
A spokeswoman for Customs said the department was ‘aware of the education aspect’ and was ‘working with policy officials to address’ the problem.