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Uk Vat queastion

  • 13-06-2011 11:37am
    #1
    margodonnelly
    Closed Accounts Posts: 2 ✭


    I was Self employed in 2008/09, and during that time I was buying goods from a uk supplier, who deducted the vat at the point of sale.
    At the end of 09, the guy looking after my accounts said that I had not been turning over enough money since that june (09) to be liable for vat, so he de-registered my liability from june to december.
    I am not self employed now, but one of my suppliers came to me to say that they want me to pay £1400 vat, which it turns out I should have paid during the 6 months I was de-registered for!
    I understand I am most probably liable for this, but right now I am unemployed and it will take a long time to pay it off.
    Will the revenue in Ireland or UK come to me over this issue? Or is it between me and the supplier, since the supplier said that they have had to pay this amount already and they want me to pay them back.
    Thanks, Margaret.


Comments

  • #2
    beeftotheheels
    Registered Users, Registered Users 2 Posts: 1,675 ✭✭✭beeftotheheels


    margodonnelly wrote: »
    I was Self employed in 2008/09, and during that time I was buying goods from a uk supplier, who deducted the vat at the point of sale.
    At the end of 09, the guy looking after my accounts said that I had not been turning over enough money since that june (09) to be liable for vat, so he de-registered my liability from june to december.
    I am not self employed now, but one of my suppliers came to me to say that they want me to pay £1400 vat, which it turns out I should have paid during the 6 months I was de-registered for!
    I understand I am most probably liable for this, but right now I am unemployed and it will take a long time to pay it off.
    Will the revenue in Ireland or UK come to me over this issue? Or is it between me and the supplier, since the supplier said that they have had to pay this amount already and they want me to pay them back.
    Thanks, Margaret.

    Avoiding giving any specific advice I would propose that you ask some questions.

    Did your tax inspector tell you that you had to deregister or did he give you the option of deregistering?

    http://www.revenue.ie/en/tax/vat/registration/index.html

    If he gave you the option did you get VAT back as a consequence or did it simply reduce your admin?

    Would you have done it if you had realized that it would cause this problem?

    If not, have you thought about speaking to your inspector in Ireland and explaining what has happened?

    The below link sets out some of the UK VAT consequences so might be worth a read to better understand it.

    http://www.hmrc.gov.uk/vat/managing/international/exports/goods.htm

    In reality you should probably get professional advice, but that will cost you.

    Checking out the two revenue authority websites and putting a call into your inspector to see if he can help, especially if you made an uninformed choice (and I don't know if you did or not) should not cost you other than the price of a phone call.


  • #3
    margodonnelly
    Closed Accounts Posts: 2 ✭margodonnelly


    beeftotheheels wrote: »
    Avoiding giving any specific advice I would propose that you ask some questions.

    Did your tax inspector tell you that you had to deregister or did he give you the option of deregistering?

    http://www.revenue.ie/en/tax/vat/registration/index.html

    If he gave you the option did you get VAT back as a consequence or did it simply reduce your admin?

    Would you have done it if you had realized that it would cause this problem?

    If not, have you thought about speaking to your inspector in Ireland and explaining what has happened?

    The below link sets out some of the UK VAT consequences so might be worth a read to better understand it.

    http://www.hmrc.gov.uk/vat/managing/international/exports/goods.htm

    In reality you should probably get professional advice, but that will cost you.

    Checking out the two revenue authority websites and putting a call into your inspector to see if he can help, especially if you made an uninformed choice (and I don't know if you did or not) should not cost you other than the price of a phone call.

    Thanks beeftotheheels,

    I did not personally speak with the inspector, rather, my bookkeeper said to me that I could de-register for vat from the time my income had dropped below the threshold for vat liability. (6months previously)
    When making account for this period I neither paid vat to revenue or claimed back vat. I just claimed receipts as expenses and paid income tax. But, I had not paid vat on uk purchases to supplier amounting to £1400.
    Who is my dealings going to be with?


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