New announcement. Learn more

CHARTERED ACCOUNTANTS (ICAEW)

News and advice to help make your property business a success

LANDLORDS FINANCIAL BLOG

All

Landlords Tax Property Tax Landlords Tax Returns Landlords Accounts Property Tax Return Property Accounts Landlords Financial Landlords Accountant Tax Returns Tax Chartered Accountants Online Accountant Online Bookkeeping Online Tax Returns VAT Your Online Accountant Your Online Bookkeeper Businessadvice HMRC Accounting Expenses Property SDLT Cashflow Dividends NIC PAYE Property Accountant Smallbusiness Businesstips Capital Gains Tax FHLs Furnished Holiday Lettings Ihtexemptions Income Tax Inheritance Tax Investment Property Tax Tax Relief Taxplanning Cgt Gifts Holiday Lets Tax ISA Landlord Repairs Pension Property bookkeeper Property Letting Sole Trader Taxreturn VAT invoice Allowable Business Expenses Annual Exempt Amount Bad Debt Tax Relief BADR Benefits in Kind Business Expenses Business Rate Business tips Capital Allowances Capital Gains Capital gains tax property Cashbasis Child Benefit Compliance Deductibleexpenses Directors Loans Disincorporation Employment Allowance Finance Financialmanagement HMRC complaints Lettings Making Tax Digital MakingTaxDigital Mileage Allowance Mobilephones MTD MTD Update National Insurance Overlaprelief Partnership Partnershipbusinesses Payrolling Ppr Property Company Tax Property Tax Deductible Expenses Propertyallowance Reimbursedexpenses Rent a Room Relief Rental Residence Relief Selfemployed Small Business Tax free income Tax Implications TimetoPay Working from home 60 day capital gains limit Abolitionclass2 Accrualsbasis Acquisitions ADR Advisoryfuelrates Agricultural Property Relief AI AirBnB Alphabet shares Amap Annual Tax on Enveloped Dwellings Appeal Artificial intelligence Assessment Asset disposal Associated Company Associated Company Tax Rules Autumnstatement Bad Debt Baddebts Badgesoftrade Beancounter Breakeven Point Budget Business advice Business asset deferment Business coach Business Continuity Business Entertainment Business Rates Business Rates Relief Businessgrowth Businesstypes Buy or Lease Equipment Buytolet Capital Allowances for Cars Capital Gain Capitalallowances Capitalexpenditure Car Capital Allowances Carry Back Losses Change of Tax Basis ChatGPT CIS Scheme Class 2 NIC Class 3 NIC Commercial Property Common Tenant Companies Expenditure Companies House Company Account Deadlines Company Account Filing Company Strike Off Company Tax Efficient Property Companyassociation Companyloanstaxfree Compulsory Strike Off Construction Industry Scheme Contacthmrc Contentmarketing Contributions Corporation Tax Losses Corporation Tax New Regime Corporation Tax Rates CorporationTax Costs Cryptocurrency Customerlistimplications Deductible Business Expenses Deductions Demerger Depreciation Development Directors Directorsloans Disallowable Business Expenses Discovery Disposals Dispute Resolution Dividend allowance Dividend Allowance Reduction Dividend Planning Dividendallowance DLA Domestic Items Tax Relief Dormantcompany EIS Employee Discount Employee management Employeecompensationpayments EmployeeOwnershipTrust Endoflifeplanning Enquiry EnterpriseResourcePlanning Entertainment Entrepreneurmindset Equity Expenses Allowed For Tax Extrabenefit Eyetests Flat Rate Scheme Flipping Furnished Holiday Lets Tax Gift Aid Gift Allowance Growthhacks Help to pay tax bills HICBC HMO Licensing Fees Holdoverrelief Holiday Lettings Tax Home responsibilities protection How to apply for a Business Loan How to Extract Profit Humour Hybrid Illegaldividends Income Income and Gains Inflationary Gains Influencers Inheritance Tax Nil Rate Band Interest Rates Interestrelief Interestrestriction Invoicing IR35 Joint Tenant Keypersoninsurance Landlords Self Assessment Late vat registration LBTT Leadgeneration Leadmagnet Leanbusinessmodel Letting Agent Disbursements Letting Agent Recharres Lettings Relief Lifetime Limit Limitedcompany Liquidation Demerger Loan Loaninterest Long Lets Tax Longservice LTT Mainresidencerelief Managed Lets Management accounting Maritalhomedivorce Marriage allowance Marriageallowance Mileage payment Minimumwage Mixedusesdlt Mortgage costs Mortgage Interest Relief New property Newcompanycarfuelrates Newnicrules NIC 2023 to 2024 NIC savings Nicdisregard Nicreduction NMW Nmwerrors Non Allowable Business Expenses Non-taxable Nudgeletter Optiontotaxvat Overpayment Relief Overseas properties Paperform Partnership schemes Parttime Patternofoccupancy PAYE by Direct Debit Payroll Penaltypoints Pension Payments Tax Relief Pensioncontributions Pensions Performance-reviews Periodofgrace Periodsofabsence Personal Expenses Personal finance Personalallowance Personalguarantees Postcessationrelief Pretradingexpenses Profit Profit-and-loss ProfitAndLoss Property Allowance Property Development Company Property Incorporation Property Investment Company Property investor accounts Property investor tax tips Property Rental Business Property Trading Propertycompany PRR R40 Recharges by Estate Agents Regularpayments Relief Rent your drive Rentaroom Research & Devolopment Residential property gains Residentialsdlt Retail stock control Retainedprofits Revenue Room for rent tax Rti SA Salary Savings SDLT changes Section 455 Tax Section455tax Selective Licences Landlords Self Assessment Self-employednic Selling Online Seperation Servicecharges Settlementslegislation Simplified Expenses Smallbiz Smallbusinessraterelief Software Spring Budget Staffparties Stamp duty Student Loan Deductions SuccessJourney Surplus Cash Tax Allowance on Driveways Tax Allowances Tax bill Tax Break Tax Codes Tax Deadlines Tax Deductions Tax Filing Deadlines Tax Free Childcare Tax on Company Vans Tax position Tax Refund Tax tips for landlords Tax-free savings income Taxbillpayments Taxconsequences Taxincentives Taxposition Taxpositionassets Taxrelief Taxreliefs Taxses Terminationpayments Tips Trade professional Trading losses Training Transfer Assets Transfer Assets Between Spouses Travel Umbrellacompany Undisclosedincome Unpaid Rent VAT Bad Debt Relief VAT Deadlines VAT Disbursements VAT flat rate scheme VAT Penalties VAT registration VAT Reverse Charge Vatpenalties Vatregistered Vatregistrationthreshold Wellbeing

TAGS

Beware the new VAT late submission penalties

June 1, 2023

Beware the new VAT late submission penalties

A new penalty regime was introduced for VAT from 1 January 2023. The new regime comprises late submission penalties and late payment penalties. Here we look at the penalty regime for late returns.

Late VAT returns

The late submission penalty regime kicks in whenever a VAT return is filed late. It applies regardless of whether VAT is owed to HMRC or whether the business is reclaiming VAT back from HMRC. For repayment traders this is a new concept as they have not previously had to worry about penalties for filing their VAT returns late.

Penalty points

The penalty regime works on a penalty point system. A VAT-registered business will receive a penalty point each time they file their VAT return late. Once the number of penalty points that they have been given reaches a certain level, the business will receive a financial penalty of £200.

The penalty threshold depends on how frequently the business files VAT returns. The thresholds are as follows:

· Annual returns: 2 penalty points.

· Quarterly returns: 4 penalty points.

· Monthly returns: 5 penalty points.

Penalty points have a lifetime of two years, after which they expire.

Once the penalty threshold has been reached and a penalty charged, the clock will only start again once the business has achieved a period of compliance. To do this, they must meet all submissions in their compliance period, which is 24 months for businesses filing annual VAT returns, 12 months for businesses filing quarterly returns and 6 months for businesses filing monthly returns. They must also have made all the submissions that were due for the preceding 24 months (regardless of whether the submissions were initially late). Once these tests have been met, the penalty points total is reset to zero.

HMRC have the discretion not to charge a penalty if they consider this to be appropriate. Time limits also apply during which penalty points must be levied, and points cannot be issued outside this window. The window runs from the date the return was due and is set at 48 weeks where VAT returns are submitted annually, at 11 weeks for quarterly returns and at 2 weeks for monthly returns. HMRC must also issue a financial penalty within two years of the failure that took the penalty points to the penalty threshold.

Landlords Tax

Landlords Accounts

Landlords Tax Returns

Property Tax

Property Accounts

Property Tax Return

Vatpenalties

Penaltypoints