The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marked the end of the Brexit transition / implementation period entered into following the UK’s withdrawal from the EU. At this point in time, key transitional arrangements came to an end and significant changes began to take effect across the UK’s VAT and customs regime. This document contains guidance on subjects potentially impacted by these changes. Before continuing your research, see the Brexit — overview guidance note.
There are specific rules relating to when VAT needs to be declared to HMRC. The time when VAT needs to be declared to HMRC is called a ‘tax point’. There are no special tax point rules for supplies made by solicitors and, with the exception of the agreed extension to the 14 day rule (see below), solicitors need to use the normal rules for determining when VAT needs to be declared to HMRC.
Solicitors will generally make single supplies for VAT purposes, even though the transaction may involve work undertaken over an extended period of time. The tax point occurs when the services have been fully completed (this is called the basic tax point). The actual tax point can be delayed by up to 14 days if the solicitor issues a valid tax invoice for the work, provided this occurs within 14 days of the work being completed.
If a solicitor makes supplies on a regular basis to a specific client, this will normally represent a series of separate supplies from a VAT perspective. Each supply will have its own basic tax point, and the solicitor will need to account for VAT when each individual service has been completed.
If the solicitor bills the client periodically for all work performed or completed during the period, the tax point rule outlined above must be used for each separate supply made.
It should be noted that, from a VAT perspective, some types of legal work are inherently continuous in nature (eg t
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
Normal due dateIndividuals are required to pay any outstanding income tax and Class 4 National Insurance, Class 2 National Insurance, and capital gains tax due for the tax year by 31 January following the end of the tax year (ie 31 January 2021 for the 2019/20 tax year). From 6 April 2020, UK
From 6 April 2015, an individual can elect to transfer 10% of the personal allowance (£1,250 in 2020/21 and 2019/20) to the spouse or civil partner where neither party is a higher rate or additional rate taxpayer. The legislation calls this the ‘transferable tax allowance’ but the GOV.UK website
What is structures and buildings allowance (SBA)?From 29 October 2018, expenditure on constructing a non-residential building or structure, or in certain cases, expenditure on acquiring such a building or structure, qualifies for an SBA. The following note has been updated for the changes announced
This guidance note provides an overview of the steps businesses need to take if aspects of their business change, and as a result, they need to notify HMRC about the change.Changes to name and / or addressIf a business changes its name and / or its address then it is required to notify HMRC of the
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.