Postponed VAT Accounting

Forum Categories VAT ADMINISTRATION ISSUES Postponed VAT Accounting

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  • #55794
    Katemorgan
    Member

    Hi,

    We have not been receiving C79 for imports, having read your posts for other questions where you advised to check PVA statements as freight forwarded may be using PVA. This happened in our case.

    I dowloaded all PVA statements which are from August 2021. What are the next steps? I believe I need to post PVA statements. Should I post it against freight forwarded account? What date should I use? Should I use date from PVA statements which will be August 2021, September 2021, etc.? If I post PVA statement with August date, I think our accounting software will include it in our next VAT return. Or should I simply make adjustment for total for August-December 2021 when I submit our next VAT return?

    Thank you so much for your replies. I really appreciate it.

    #56249
    Trevor S
    Participant

    A key difference between C79 and PVA is that C79 shows amounts of import VAT that has already been paid over to HMRC, and you can just reclaim on your VAT return. PVA statements show import VAT amounts that have not yet been paid to HMRC, so entries are required to both pay it to and reclaim it from HMRC via the VAT return.

    I don’t know how any specific software packages would need them to be entered – but, from the VAT return perspective, it’s very similar to the reverse charge on services.  The VAT figures need to be included in both box 1 and 4.

    The adjustment should be done in the return for the period covered by the statement. I don’t know what months each of your VAT return quarters cover, but if you have statements going back to August, some will now be late. The normal rules in section 4 of HMRC’s notice 700/45 apply – regarding whether the correction can be done on the next return, or needs to be notified on form VAT652. Generally errors under £10k can be corrected on the next return, with higher limits (up to £50k) applying to larger businesses.

    Do you know for certain that August 2021 was definitely the first? The system will only let you download the last six months statements, older ones have to be requested (see: https://www.gov.uk/guidance/get-your-postponed-import-vat-statement#if-you-need-a-statement-more-than-6-months-old ).

    #56250
    Katemorgan
    Member

    Thank you so much for the guidance. I will request copies as there may be statements prior to August 2021.

    If it is similar to the reverse charge on services, the net effect will be zero so I am not sure if we still need to notify HMRC on the form VAT652. Best option will be if I speak with HMRC.

    Thank you again for the advice. I really appreciate it.

    #56251
    Trevor S
    Participant

    Yes you’re right – the net error will be zero, so you can adjust on the VAT return.

    #56252
    Katemorgan
    Member

    Hello,

    Just to keep you updated, I spoke with HMRC and as per VAT Notice 700/45 4.11 I was advised to email explanation of errors

    inbox.btcnevaterrorcorrection@hmrc.gov.uk

    No further action is needed as there is no VAT payable.

    Thank you for all your help.

    #56253
    Trevor S
    Participant

    Thanks for the update!

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