VAT and the Mini One Stop Shop (MOSS)

26 February 2015 •

An important change took place on the 1 January 2015 regarding the VAT place of supply rules in respect of digital services.

The change in rules affects Business to Customer (B2C) supplies within the EU of:

1) Telecommunication services
2) Broadcasting services, and
3) e-services

As of 1 January 2015, instead of the place of supply for these services being in the country where the Business is established it will now be the country where the Customer is located.  The old rules will continue to apply up until 31 December 2014.

A UK business supplying the above digital services to non-business customers (B2C) in other EU member states will therefore have to charge and account for the VAT according to the local VAT rules of the customers country.  To properly account for the VAT under these new rules, the affected UK businesses would normally need to register for VAT in each EU member state in which they supply such services.

However, HMRC have introduced the Mini One Stop Shop (MOSS) system which will enable an affected business to submit one quarterly return and payment to HMRC to account for the overseas VAT charged to its EU customers.

In order to register for the MOSS system with HMRC, the UK business must be registered for VAT in the UK.  There are special rules available for UK business that are not registered for UK but would still be caught under the local VAT rules of the country in which their customer resides.

This will represent an additional administrative requirement for those affected businesses and if your business provides telecommunication services, broadcasting services and/or e-services to customers in EU member states then please get in touch with us at Warrener Stewart in order that we may assist you.

Time is of the essence as the first VAT MOSS return will be for the quarter ended 31 March 2015, which will need to be submitted to HMRC by 20 April 2015.  Payment of the VAT will also be due at this time.

If you have any questions regarding your tax affairs in general please do not hesitate to contact us on 020 7731 6163.
 

Foreign Account Tax Compliance Act (FATCA)

13 February 2015 •

On 30 September 2016 financial institutions in the Crown Dependencies (Jersey, Guernsey and the Isle of Man) and the British Overseas Territories (CDOTs) will automatically exchange information with HMRC in relation to UK residents holding financial assets in these CDOTs for the 2014 and 2015 calendar years.

UK resident non-domiciled individuals (RND) who have claimed the remittance basis of assessment on their tax returns can elect for the Alternative Reporting Regime (ARR) to apply and without this election, HM Revenue and Customs may receive information on these accounts and assets far in excess of what an individual is required to report on a UK tax return.

In order for the ARR to apply the following conditions must be satisfied:

1.    Reporting Financial Institution Election

The reporting financial institution must make a one-off election to their local tax authority in order to operate the ARR. The election must be received no later than:

•         30 May 2015 for Crown Dependencies (Jersey, Guernsey and the Isle of Man),
•         30 April 2015 for the British Virgin Islands and the Cayman Islands,
•         30 September 2016 for Bermuda (direct election to HMRC).

2.    UK resident, Non-Dom Annual Election

The taxpayer will be required to submit an annual election to qualify for the ARR. The deadline for receipt of the first annual election is dependent on the jurisdiction in which the accounts or assets reside and must be received no later than:

•         30 May 2015 for Crown Dependencies (Jersey, Guernsey and the Isle of Man),
•         30 April 2015 for British Virgin Islands and the Cayman Islands,
•         Awaiting official guidance with respect to Bermuda.

3.    UK resident, Non-Dom Self-Certification

The taxpayer will also need to file a self-certification no later than 28 February following the relevant tax year. Therefore, in relation to the 2014/15 tax year your self-certification must be received no later than 28 February 2016

The election must include a written and signed confirmation of the following to the reporting offshore financial institution:

• Confirmation that your UK tax return for the relevant year contains a claim or statement that you are not domiciled in the UK,
• Confirmation that your UK tax return for the relevant year includes a claim to be taxed under the remittance basis and the remittance basis charge has been paid if relevant,
• Confirmation that to the best of your knowledge and belief your domicile status and claim to be taxed on the remittance basis is not being formally disputed by HMRC.

4.    Deadline for Disclosure

Should your offshore income or capital gains derived from your offshore assets in these territories have either been incorrectly reported or not reported at all, a tax disclosure must be submitted no later than:

• 30 September 2016 for Crown Dependencies (Jersey, Guernsey and the Isle of Man),
• 5 April 2015 for all other jurisdictions.

Moreover, we would strongly advise you to contact your offshore service providers and request details in relation to your offshore interests for the calendar years 2014 and 2015 as soon as possible.

If you have any questions regarding the introduction of the above or wish to speak to Warrener Stewart about your tax affairs in general please do not hesitate to contact us.

Just too good to be true….

12 February 2015 •

Fulham based Warrener Stewart’s two runners in the Craven Cottage 10K in aid of Prostate Cancer on Sunday 8 February, Nick Morgan and Francis Kershaw, both completed the course in under an hour. 

Despite training with fellow colleague Ryan O’Conner, he sadly missed the race due to technical difficulties, so the Warrener Stewart Chartered Accountant's team was bolstered by Nick’s son and one of his son’s friends. Not to be out done by his father, son Rick Morgan and his friend James Roach, raced around the Fulham road course to beat his father back to the pitchside in just 45 minutes.

Slightly breathlessly, Nick commented; “It was a very cold start but once Francis and I got into our stride it turned into a fine morning run along the Thames Tow Path."

When asked about his son’s victory, Nick’s response was; “I’m definitely getting too old for all this stuff!”

(pictured above, l-r: Nick Morgan, Rick Morgan, James Roach & Francis Kershaw)

“Warrener Stewart understands our business; they give us more than any other Accountancy service we have ever received in the past. They are extremely commercially aware and very current when it comes to changes in tax policy. ”
Diana Hoare - Anderson Hoare