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What’s going on with import VAT accounting?

While the newer system of postponed import VAT accounting
has been in place since early 2021, it still isn’t without its problems. Unfortunately, import VAT confusion is ongoing, as many businesses continue to experience issues like the following:

Inability to access monthly statements

Some importers have trouble accessing monthly statements for import VAT when logging on through the Government Gateway. If this is happening to you, try clicking the ‘start now’ button at the bottom of this page to get your import VAT statement.

Remember that online VAT statements are only available as an online PDF for 6 months after they’ve been published. This means you must download the import VAT documents within this time, and store them securely for your annual and long-term records.

Lack of feedback from freight agents

You may have been importing goods without receiving any import VAT paperwork, so haven’t made import VAT payments. In this case, it’s likely that the freight agent switched to postponed VAT accounting by default, and may not have informed you.

If you haven’t already done so, then you’ll need to sign up for the Customs Declaration Service as soon as possible. You’ll only have access to the previous 6 months of import VAT statements, and you’ll need these for your tax returns in order to reclaim VAT.

Missing VAT figures on invoices

Have you been receiving invoices for imported goods without a VAT number? This can be confusing and worrying if freight companies are adopting different approaches, and aren’t getting in touch with you to let you know how their VAT accounts are operating.

Usually, postponed VAT accounting will deal with import VAT returns, as previously explained. However, freight agents might pay the VAT to release the imported goods, in which case HMRC should send you a C79 form to reclaim the VAT that was paid.

Not receiving C79 forms

If you haven’t received a C79 VAT certificate from HMRC, it could have gotten lost in the post, or HMRC may not have issued one because the freight company defaulted to postponed accounting. This can complicate finding out how much VAT you’ve paid and how much input tax you can reclaim.

You should receive a C79 in the mail if the import VAT declarations were made using the CHIEF service (Customs Handling of Import and Export Freight). If they used the Customs Declaration Service, you should be able to access the certificates online.

Incorrect coding in import VAT software

It’s always important to use the correct VAT codes, but it’s especially important for businesses with partial exemptions, who might not be able to recover the VAT without the appropriate coding. If you have any doubts about your import VAT coding, it’s best to get advice from your software provider.

Every accounting package might have its own approach to postponed VAT, but you can always check when postponed VAT accounting is possible here. Of course, should you need import VAT assistance from our accountants in Barnsley, we’re always available to help if you get in touch with GBAC.