- HMRC has updated VAT Notice 700/45, focusing on correcting VAT errors. Form 652 is no longer used for disclosing errors above certain thresholds; corrections must now be made via a government gateway account or in writing. The emphasis is on penalties for errors corrected on current returns, with adjustments allowed for errors below £10,000 or below £50,000 if less than 1% of sales. Careless errors must be reported to HMRC, potentially reducing penalties from 15%-30% to 0% if disclosed. Businesses should assess the nature and size of errors, explain them to HMRC, and prevent recurrence. HMRC considers many errors as careless, and compliance checks may lead to penalties if errors are not reported. Late payment interest applies if errors cause late VAT payments.
Source: mha.co.uk
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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