Details of the Schedule
Details of the new Schedule 1A to VATA
2.New Schedule 1A applies to any person who makes taxable supplies in the UK but has no establishment here and requires that person to register and account for VAT on those supplies irrespective of their value.
3.New paragraphs 1 and 2 provide that the liability to register arises when a person reasonably anticipates making taxable supplies within the next 30 days, does in fact make such supplies or a business is transferred to that person as a going concern.
4.New paragraphs 5 and 6 provide that the person must notify liability to register within 30 days of the liability arising and the Commissioners must register that person with effect from the date when the liability arises.
5.New Schedule 1A also specifies when a person will cease to be liable to be registered under the new schedule (new paragraph 4) and makes provision for various matters that may arise in connection with registration such as wrongful registration under another Schedule (new paragraph 3), cancellation of registration (both compulsory and by election) and the effective date of such cancellation, (new paragraphs 7 to 12). These provisions also specify the timescales for the notification and execution of various matters relating to cancellation of registration.
6.New Schedule 1A makes particular provision for the possibility that a person may be liable to be registered under the new Schedule and also entitled to be registered under Schedule 3B to VATA (special accounting scheme for the supply of electronic services in member States) (new paragraph 12).
7.New Paragraph 13 provides that a person liable to registration under the new Schedule may, on request and subject to HMRC’s approval, be exempted from registration if that person intends to or makes only zero-rated supplies (and so would, if registered, be entitled to a VAT refund but not liable to pay VAT).
Other amendments of VATA 1994
8.Paragraphs 2 to 17 of this Schedule make amendments that are consequential on the inclusion of the new Schedule 1A.
9.Paragraphs 3 to 17 ensure that VATA applies to Schedule 1A as it applies to Schedule 1 for the following contexts:
place of supply of goods rules (paragraph 3);
schemes for farmers (paragraph 4),
accounting for gold (paragraph 5);
reverse charge provisions for missing trader intra-community (MTIC) trading activities (paragraph 6);
regulatory breaches (paragraph 7);
powers of assessment and related matters (paragraphs 8 to 10); and
interaction with other registration schedules (paragraphs 14 to 17).
10.Paragraphs 11 to 13 ensure that the relevant parts of Schedule 1 apply only to persons established in the UK.
11.Paragraph 11(4) provides that the value of the taxable supplies of a person established in the UK for the purposes of determining that person’s liability to register under Schedule 1 shall include supplies made prior to that person becoming established.
12.Paragraph 18 provides that Schedule 41 to Finance Act 2008 applies to New Schedule 1A as it applies to Schedule 1 for the context of obligations to notify a liability to register and for material changes in the nature of supplies made by exempt persons.