Michael Sohor & Co is now known as Tamen Accountants. This is a name change only - we are the same dedicated team, and look forward to serving our valued clients for many years to come.
Where an error on a past VAT return is uncovered businesses have a duty to correct the error as soon as possible. As a general rule, any necessary adjustment can be made on a current VAT return. To do this, the errors must be below the reporting threshold.
Under the reporting threshold rule, businesses can make an adjustment on their next VAT return if the net value of the errors is £10,000 or less. The threshold is further increased if the net value of errors found on previous returns is between £10,000 and £50,000 but does not exceed 1% of the total declare sales value for the return period in which the errors are discovered.
HMRC must be separately notified of errors that exceed either of the limits set out above or if the error was deliberate. VAT errors of a net value that exceed the limits for correction on a current return or that were deliberate should be notified to HMRC by making the correction online or submitting form VAT 652 (or providing the same information in letter format) to HMRC's VAT Error Correction team.
HMRC can also charge penalties of up to 100% of any tax under-stated or over-claimed if you file an inaccurate return.
Share this post:
Our team are waiting to answer any question you may have via our live chat feature.
Call us on:
Email us on:
27th Aug 24 | Updates/ News
Interest rates are a powerful lever in our economy. Increase rates and economic activity tends...
22nd Aug 24 | Updates/ News
Since Rachel Reeves was appointed Chancellor of the Exchequer in May 2024, she has made...
20th Aug 24 | Updates/ News
Tax relief on private pension scheme contributions is a significant incentive in the UK, encouraging...
Your email address will not be published. Required fields are marked *
Comment *
Name *
Email *
Website
Save my name, email, and website in this browser for the next time I comment.