Help needed - VAT due

Paige

Can anyone help me ? My quartly VAT is due for my business on 31st Dec, approx £4000.
Due to some clients paying invoices late - because of christmas/ New year I cannot afford to send the VAT cheque until about the 10th Jan. I have been 4 days late once before and just recieved a snotty letter.
Does anyone know what will happen. Will I get fined ? Maybe they wont notice because they will be behind because of the holidays.
I did wonder if it would be best to phone them to explain but I do not think that this is a good idea as it might alert them to my problem and I could not cope with a VAT investigation right now.
Thanks for any advice. Paige X

melaniec_2

Hi

I don't think you have any choice but to phone them. I'm sure I've read some where that if you are having difficulties call them, they may let you pay in installments.

roger56

Do let them know your situation now, don't ignore it.

Here is some useful guidance:
http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageVAT_FAQs&propertyType=document&columns=1&id=HMCE_PROD_008570

Just to confirm, is Dec 31st just the end of your accounting quarter, or actually when the payment is due.
Though it won't help now, it's worth remembering that doing VAT online gives you 7 extra days until the deadline. You also get payment confirmation immediately so you can rest easy, no wondering if the post arrived in time!! See here:

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageVAT_ShowContent&id=HMCE_PROD_011666&propertyType=document

Richard_S

Paige wrote:

Can anyone help me ? My quartly VAT is due for my business on 31st Dec, approx £4000.
Due to some clients paying invoices late - because of christmas/ New year I cannot afford to send the VAT cheque until about the 10th Jan. I have been 4 days late once before and just recieved a snotty letter.
Does anyone know what will happen. Will I get fined ? Maybe they wont notice because they will be behind because of the holidays.
I did wonder if it would be best to phone them to explain but I do not think that this is a good idea as it might alert them to my problem and I could not cope with a VAT investigation right now.
Thanks for any advice. Paige X

Hi Paige,

Couldn't you "accidentally" make a mistake in calculating your Output VAT so that it appears in the next quarter - missing formula in spreadsheet, slip of the pen. Are there any large supplier invoices that you could include in your Input VAT that are not due to be paid until the next quarter - just remember to adjust and again you've done nothing wrong. Everyone makes mistakes, especially at such a busy time of year as Christmas.

Richard

Paige

Thank you Roger. The payment date is 31st Dec. I will register to pay online for the next quarter. Paige X

roger56

Richard_S wrote:

Hi Paige,

Couldn't you "accidentally" make a mistake in calculating your Output VAT so that it appears in the next quarter - missing formula in spreadsheet, slip of the pen. Are there any large supplier invoices that you could include in your Input VAT that are not due to be paid until the next quarter - just remember to adjust and again you've done nothing wrong. Everyone makes mistakes, especially at such a busy time of year as Christmas.

Richard

I do not recommend this, it is deception. However it is your risk and they will probably see through it if they were to investigate your accounting.

To learn how to correct errors, see here:
http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageVAT_InfoGuides&propertyType=document&id=HMCE_CL_000077

Paige

Thanks Richard. I did think about adjusting the figures , I could carry Nov earnings over to Dec and pay next quarter, or I could forget to sign the cheque. I live in fear of the dreaded VAT inspection !!

Richard_S

Paige wrote:

Thanks Richard. I did think about adjusting the figures , I could carry Nov earnings over to Dec and pay next quarter, or I could forget to sign the cheque. I live in fear of the dreaded VAT inspection !!

We've had several over the years and they're really not that bad, unless you're deliberately trying to defraud Customs they accept that mistakes do happen. We actually had one inspection that got off on the wrong foot because of a genuine mis-understanding but once we resolved that it went swimmingly. The inspector actually advised us that we could reclaim VAT on dog food because our pooches lived close to where we were storing stockand thus acting as guard dogs.

Kind regards

Richard

Debt_Free_Chick

You can be sure that HMRC have seen just about every trick in the book and anything you do is likely to be viewed with some suspicion.

It's far better to be open with them and to come to some arrangement.

In addition, are you sure you are on the most suitable VAT scheme? Would switching to another scheme be an option and/or more suitable?

Richard_S

roger56 wrote:

I do not recommend this, it is deception. However it is your risk and they will probably see through it if they were to investigate your accounting.

To learn how to correct errors, see here:
http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageVAT_InfoGuides&propertyType=document&id=HMCE_CL_000077

Point taken Roger, however, I would imagine if there's any sense of priority at HMCE they'll be concentrating on the huge scale of fraud involved with "ghost" imports rather than "nit picking" over small businesses that face a nightmare just managing to keep their heads above water.

pusscat

HMRC are the last people you want to mess around.

In exceptional circumstances they have been known to allow a late payment or payment by installments. It is certainly worth contacting them to see.
However, this must be a one off as VAT is only collected from monies already recieved by you, so in theory you are using HMRC's money to fund your business.

HMRC have see every trick inthe book (and more besides) so don't bother with any "get round" schemes - best to be honest!

Puss