VAT - 31.05.2022

Latest guidance on new VAT penalty rules

New penalty rules updated. Early in 2022 HMRC announced that the introduction of its new regime for VAT penalties and interest on late payments, which is part of an overall alignment of penalties across the main taxes, would be delayed from 1 April 2022 to 1 January 2023. In preparation for this HMRC has issued new guidance with updated information on how the new penalties will be worked out and when they’ll apply (see The next step ).

Amnesty. There will be a partial amnesty during what HMRC calls the period of “familiarisation” with the new rules. It says “To give you time to get used to the changes, we will not be charging a first late payment penalty for the first year from 1 January 2023 until 31 December 2023, if you pay in full within 30 days of your payment due date.”

For a link to HMRC guidance, visit https://www.tips-and-advice.co.uk , Download Zone, year 22, issue 17.

HMRC has updated its guidance on the new penalty regime, which will apply to VAT accounting periods commencing on or after 1 January 2023. It says that during the first year of the new rules it will waive the penalty that applies.

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