VAT rate change – what to watch for !
There may be a few admin queries regarding this change. The invoice basis of accounting is straight forward (date of invoice applies along with usual rules).
If you are a cash receipts basis, you must apply the rate of VAT in force at the time of the supply – therefore even if you receive funds in September, but the work was done in August, you will pay revenue the 23% you had invoiced in August (even though received in sept)
Have a review of the below updated note from Revenue regarding ‘changes in rates of VAT’.
There are notes in here of what to put on credit notes (if raising them), payments in advance and contracts existing at the time of the change (e.g builders) and more.
I hope this is helpful. Get in touch with your accountant if you have specific concerns or questions
Have a lovely week
Wendy
[31 August 2020]
