The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
This guidance note covers the main VAT tax point rules that apply to barristers. For guidance on when a barrister may need to register for VAT, see the Overview ― registering for VAT guidance note.
Please note that HMRC has made some temporary changes to the way that barristers and advocates should pay VAT on professional fees and send correspondence during the coronavirus (COVID-19) outbreak. These changes aren’t covered in this guidance note, but for details, see the Coronavirus (COVID-19) and VAT - further VAT consequences guidance note.
HMRC introduced special tax point rules for barristers after reaching an agreement with the Bar Council and Faculty of Advocates.
A tax point is the date when a business is required to account for VAT on a supply of goods and services. The business must ensure that VAT is accounted for on the VAT return covering the period in which the tax point occurred.
The tax point for a supply of professional services by a barrister is the earliest of:
the date the barrister received a fee for the professional services rendered
the date the barrister issued a VAT invoice for the professional services provided, or
the date the barrister ceased to practice
Please note that HMRC can grant permission to a barrister that ceases to trade to defer payment of the VAT due (see below).
If a barrister makes a decision to cease trading and, as a result, does not continue to make supplies which are liable to VAT, the barrister must cancel their VAT registration number. See the Cancelling a VAT registration number guidance note for more information.
The barrister is legally required to notify HMRC within 30 days that the business is ceasing to trade. The barrister should complete and submit a VAT 7 or use the online notification procedure using the HMRC portal.
If the barrister continues to make taxable supplies, then he can remain VAT
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