HMRC: Be prepared for VAT changes

Date: 30th March 2010

Businesses are being urged to prepare for changes in the way VAT returns are filed.

HM Revenue & Customs has urged businesses and traders to make sure they are ready for the changes, which come into effect next month.

Under the new system, businesses and contractors, including sole traders and limited companies, will be obliged to file their VAT returns online if their annual turnover is in excess of £100,000.

Traders registering for VAT for the first time will also need to do so using HMRC's online service.

The department warned that anyone issuing an invoice with VAT included, without registering could face a penalty charge.

Stephen Banyard, director of HMRC's Business Customer Unit, said: "If you're a VAT-registered trader or an employer, make sure you're up to speed with all the VAT and PAYE changes coming in this spring.

"If you're well prepared for the changes, you'll help avoid a last-minute rush when the new measures take effect."

The changes also mean that all VAT payments made to HMRC will have to be made using electronic methods.