Budget Summary 2014 - page 14

VALUE ADDED TAX
VAT thresholds
The VAT registration threshold will rise from £79,000 to £81,000
and the deregistration threshold will increase from £77,000 to
£79,000. Both changes take effect from 1 April 2014.
Prompt payment discounts
There will be new rules to ensure that VAT is accounted for on the
actual price paid for goods and services where a supplier offers
prompt payment discounts. The change will take effect on 1 May
2014 for supplies of telecommunication and broadcasting services
to consumers and on 1 April 2015 for other goods and services.
Place of supply rules
From 1 January 2015, intra-EU business to consumer (B2C) supplies
of telecommunications, broadcasting and e-services will be taxed in
the member state where the consumer is located. This was
announced in the Budget 2013. To support this change, a mini one-
stop shop will be introduced from 1 January 2015 and this will
enable businesses accounting for VAT on these types of supplies in
other member states to register only in the UK using a single
return.
Reverse charge for gas and power
A reverse charge for gas and power will be introduced to prevent
missing trader intra-community fraud in relation to these
commodities from a date subject to industry consultation.
VAT avoidance
The government will consult on changes to the VAT avoidance
disclosure regime to bring it more in line with the disclosure of tax
avoidance schemes (DOTAS) regime. The proposals will include
shifting the primary responsibility for disclosure from users to
scheme promoters.
BUDGET
19 MARCH 2014
page 14
think ahead
Consider cash accounting
for VAT if your turnover
is less than £1.35 million.
You only pay VAT on cash
you receive rather than of
your invoices. Many
businesses find it makes
sense.
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