Changes in VAT legislation effective from 1st April 2015
|kristina.tikhonova 20/07/2015 15:36:30
We would like to make you aware of some important changes that HMRC has announced with regard to the calculation and payment of VAT on Prompt Payment Discounts (PPDs). These changes will impact all suppliers who offer and all customers who receive PPDs, where an invoice is issued. (A PPD is often referred to as a settlement discount.)
Effective from 1st April 2015, suppliers must account for VAT on PPD’s in the amount they actually receive and customers may recover the amount of VAT on PPD that is actually taken in the payment to the supplier. Adjustments will need to be made at the point of payment to reflect the new VAT calculation methodology.
Further details on the changes coming into effect can be can be found on the HMRC’s website.
To support the regulative change, you will need to make an update to your system. However, what update(s) you will need and how these are applied will depend upon whether or not you use settlement discounts (PPDs) and whether you are using non-standard invoice formats and customised reports for VAT analysis purposes.
If this impacts you, please e-mail us on VATsupport.email@example.com stating whether you issue or receive PPDs. Once we receive your e-mail, we will get back in touch with a specific action plan for you that covers both the version of the software you are on and also the changes needed to comply with the new HMRC rulings that impact you. KCS PSG consultancy team can be contacted to make changes to non-standard stationary and/or reports. Should you wish to use this service please advise as part of your response.
If this raises any questions, please do not hesitate to contact us through the email address below.
Kerridge Commercial Systems Ltd.