HMRC is consulting until 29 June 2018 on VAT ‘split payment’ as a means of preventing online VAT fraud, whereby a supplier would receive the net amount, with VAT remitted directly to HMRC.
HMRC is consulting until 29 June 2018 on VAT ‘split payment’ as a means of preventing online VAT fraud, whereby a supplier would receive the net amount, with VAT remitted directly to HMRC. The government examined the feasibility of introducing a split payment method in a call for evidence during 2017.
This consultation looks at potential split payment mechanisms. The government’s view is that the merchant acquirer is likely to be the best party to effect the split of VAT from the gross payment (with card issuers or banks as fallback options). During a setup stage, HMRC could create a list of fit and proper acquirers and payment service providers, which card issuers would check for each transaction, before deciding either to release the full payment, or make the split themselves. HMRC would then credit the merchant’s VAT account with the amount received from either the acquirer, payment service provider, or the card issuer.
Three options are considered for the amount of VAT to include in the split. These are: a standard rate split; flat rate scheme; or net effective rate.
HMRC is consulting until 29 June 2018 on VAT ‘split payment’ as a means of preventing online VAT fraud, whereby a supplier would receive the net amount, with VAT remitted directly to HMRC.
HMRC is consulting until 29 June 2018 on VAT ‘split payment’ as a means of preventing online VAT fraud, whereby a supplier would receive the net amount, with VAT remitted directly to HMRC. The government examined the feasibility of introducing a split payment method in a call for evidence during 2017.
This consultation looks at potential split payment mechanisms. The government’s view is that the merchant acquirer is likely to be the best party to effect the split of VAT from the gross payment (with card issuers or banks as fallback options). During a setup stage, HMRC could create a list of fit and proper acquirers and payment service providers, which card issuers would check for each transaction, before deciding either to release the full payment, or make the split themselves. HMRC would then credit the merchant’s VAT account with the amount received from either the acquirer, payment service provider, or the card issuer.
Three options are considered for the amount of VAT to include in the split. These are: a standard rate split; flat rate scheme; or net effective rate.
