Statutory Instruments
Value Added Tax
Made
8th December 2010
Laid before the House of Commons
10th December 2010
Coming into force
4th January 2011
1. These Regulations may be cited as the Value Added Tax (Amendment) (No. 3) Regulations 2010 and come into force on 4th January 2011.
2. The Value Added Tax Regulations 1995(6) are amended as follows.
3. In regulation 15A (change of rate, supplementary charge invoices), after “Schedule 3 to the Finance Act 2009” insert “or Schedule 2 to the Finance (No. 2) Act 2010(7)”.
4. For the Table in regulation 55K (flat rate scheme for small businesses, category of business), substitute—
| “Category of business | Appropriate percentage |
|---|---|
* “Labour-only building or construction services” means building or construction services where the value of materials supplied is less than 10 per cent of relevant turnover from such services; any other building or construction services are “general building or construction services”.” | |
| Accountancy or book-keeping | 14.5 |
| Advertising | 11 |
| Agricultural services | 11 |
| Any other activity not listed elsewhere | 12 |
| Architect, civil and structural engineer or surveyor | 14.5 |
| Boarding or care of animals | 12 |
| Business services that are not listed elsewhere | 12 |
| Catering services including restaurants and takeaways | 12.5 |
| Computer and IT consultancy or data processing | 14.5 |
| Computer repair services | 10.5 |
| Dealing in waste or scrap | 10.5 |
| Entertainment or journalism | 12.5 |
| Estate agency or property management services | 12 |
| Farming or agriculture that is not listed elsewhere | 6.5 |
| Film, radio, television or video production | 13 |
| Financial services | 13.5 |
| Forestry or fishing | 10.5 |
| General building or construction services* | 9.5 |
| Hairdressing or other beauty treatment services | 13 |
| Hiring or renting goods | 9.5 |
| Hotel or accommodation | 10.5 |
| Investigation or security | 12 |
| Labour-only building or construction services* | 14.5 |
| Laundry or dry-cleaning services | 12 |
| Lawyer or legal services | 14.5 |
| Library, archive, museum or other cultural activity | 9.5 |
| Management consultancy | 14 |
| Manufacturing fabricated metal products | 10.5 |
| Manufacturing food | 9 |
| Manufacturing that is not listed elsewhere | 9.5 |
| Manufacturing yarn, textiles or clothing | 9 |
| Membership organisation | 8 |
| Mining or quarrying | 10 |
| Packaging | 9 |
| Photography | 11 |
| Post offices | 5 |
| Printing | 8.5 |
| Publishing | 11 |
| Pubs | 6.5 |
| Real estate activity not listed elsewhere | 14 |
| Repairing personal or household goods | 10 |
| Repairing vehicles | 8.5 |
| Retailing food, confectionary, tobacco, newspapers or children’s clothing | 4 |
| Retailing pharmaceuticals, medical goods, cosmetics or toiletries | 8 |
| Retailing that is not listed elsewhere | 7.5 |
| Retailing vehicles or fuel | 6.5 |
| Secretarial services | 13 |
| Social work | 11 |
| Sport or recreation | 8.5 |
| Transport or storage, including couriers, freight, removals and taxis | 10 |
| Travel agency | 10.5 |
| Veterinary medicine | 11 |
| Wholesaling agricultural products | 8 |
| Wholesaling food | 7.5 |
| Wholesaling that is not listed elsewhere | 8.5 |
5. In regulation 55M (withdrawal from the scheme)—
(a)in paragraph (1)(a), for “£225,000” substitute “£230,000”,
(b)in paragraph (1)(b), for “£225,000 substitute “£230,000”, and
(c)in paragraph (2), for “£187,500” substitute “£191,500”.
6. In regulation 173P (the day by which a claim under this Part must be made)—
(a)at the beginning of paragraph (1) insert “Subject to paragraph (1A),”; and
(b)after paragraph (1) insert—
“(1A) A repayment application in respect of a repayment period falling within the repayment year commencing on 1st January 2009 must be submitted in accordance with regulation 173I(c) before 1st April 2011.”.
Dave Hartnett
Steve Lamey
Two of the Commissioners for Her Majesty’s Revenue and Customs
8th December 2010
(This note is not part of the Regulations)
These Regulations come into force on 4th January 2011 and amend Parts 3 (VAT invoices and other invoicing requirements), 7A (flat-rate scheme for small businesses) and 20 (repayments to Community traders) of the Value Added Tax Regulations 1995 (S.I. 1995/2518).
Regulation 3 amends regulation 15A (change of rate, supplementary charge invoices) to include a reference to a supplementary charge due under Schedule 2 to the Finance (No. 2) Act 2010 as a consequence of the increase in the standard rate of VAT from 17.5% to 20% on 4th January 2011.
Regulation 4 amends regulation 55K (flat rate scheme for small businesses, category of business) to substitute a new table with revised percentages to reflect the increase in the VAT rate.
Regulation 5 amends regulation 55M (withdrawal from the flat rate scheme) to provide for revised figures relating to exit thresholds to reflect the increase in the VAT rate.
Regulation 6 amends regulation 173P (day by which a claim under this Part must be made) to implement an amendment made by Council Directive 2010/66/EU (OJ No L 275, 20.10.2010, p 1) to Council Directive 2008/9/EC (OJ No L 44, 20.02.2008, p 23) which lays down the rules for the refund of VAT incurred by a taxable person in a Member State other than the Member State in which that person is established. Its effect is that claims for repayment of VAT incurred in the year commencing on 1st January 2009 may be submitted to Her Majesty’s Revenue and Customs until 31st March 2011.
A full Impact Assessment has not been produced in relation to this instrument as it has no impact on business, charities or voluntary bodies.
A full Impact Assessment of the effect that the increase in the VAT rate will have on the costs of business and the voluntary sector is available at http://www.hmrc.gov.uk/better-regulation/ia.htm.
The functions of the Commissioners of Customs and Excise were transferred to the Commissioners for Her Majesty’s Revenue and Customs by section 5 of the Commissioners for Revenue and Customs Act 2005 (c. 11). Section 50(1) of that Act provides that a reference to the Commissioners of Customs and Excise shall be taken as a reference to the Commissioners for Her Majesty’s Revenue and Customs.
Section 26B was inserted by section 23(1) and (4) of the Finance Act 2002 (c. 23).
Section 39 was amended by section 77(1) and (2) of the Finance Act 2009 (c. 10).
Paragraph 2A of Schedule 11 was inserted by section 24(2) and (5) of the Finance Act 2002 with effect from 1 December 2003 by virtue of S.I. 2003/3043 and its scope was extended by paragraph 22 of Schedule 3 to the Finance Act 2009 and paragraph 22 of Schedule 2 to the Finance (No. 2) Act 2010 (c. 31).
1994 c. 23; section 96(1) defines “the Commissioners” as meaning the Commissioners of Customs and Excise and “regulations” as meaning regulations made by the Commissioners under the Act.
S.I. 1995/2518; relevant amending instruments are 2002/1142, 2003/1069, 2003/3220, 2009/586 and 2009/3241.