Whilst the case may be appealed by HMRC, it is worth considering a “protective” claim on HMRC to repay VAT overpaid on such sales.
Apart from those that sell e-newspapers, this ruling may also extend to those publishing e-magazines, e-books, online maps, and newsletters issued digitally as part of a membership package of benefits, such as charities and organisations/associations that issue annual newsletters as part of the membership package of benefits. This latter group may have agreed an apportionment arrangement with HMRC in that some of the annual subscription is applied to a zero rated printed newsletter, but standard rated e-newsletter.
Action
If you issue an e-publication and charge VAT at the standard rate, you may be able to make a “protective” claim for overpaid VAT. This would entail compiling a voluntary disclosure to cover the past four years in full (if applicable).
Making the claim means that as time moves forward (the case may take years to finalise) the four years are “protected” and do not fall out of time. If e-sales are still occurring we can assist you by making an annual claim at the end of each year. The claims should be lodged with HMRC with a request to “stand behind” the VAT case until the final outcome is known. If HMRC win the case, the claims can be withdrawn.
If you are affected by this and would like to speak to Rob
Related news
VAT alert: Domestic reverse charge on building and construction services
If your VAT-registered business provides construction services to another business you will no longer need to charge them VAT.
VAT deferment
The Chancellor has announced that VAT for the period 20 March 2020 to 30 June 2020 will not need to be paid during this quarter.