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Pteris offers a complete portfolio of business services designed to simplify our customers' lives. This allows them to concentrate on what they do best - serving their customers - without the worry of day-to-day administration.

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04.10.2019: Good Networkers' Thought of the Week

If one does not know to which port one is sailing, no wind is favourable.
– Lucius Annaeus Seneca

19.07.2019: VAT Domestic Reverse Charge for Construction

The VAT domestic reverse charge for building and construction services is a change in how VAT is handled for certain kinds of construction services in the UK, along with the building and construction materials used directly in those services (although it doesn't apply to building and construction materials supplied separately and independently of any construction services).

The VAT reverse charge for construction is effectively an extension of the Construction Industry Scheme (CIS) and applies only to transactions between VAT-registered contractors and sub-contractors who are registered for the CIS.

The scheme means that those supplying construction services to a VAT-registered customer will no longer have to account for the VAT. Instead, the customer will account for the VAT (that is, it will be considered input tax for them, as if they've made the supply to themselves).


In even simpler terms, for services they provide, sub-contractors will require the contractor employing them to handle and pay the VAT directly to HMRC. The payment received will be for the cost of the work done (plus materials used).

The VAT domestic reverse charge for construction begins from 1 October 2019.

07.02.2019: Making Tax Digital for VAT

Main Issues for Consideration

Businesses whose taxable turnover exceeds the VAT registration threshold will need to keep their records digitally, using MTD functional compatible software, and create the VAT return from that (or a combination of) software, for return periods starting on or after 1 April 2019, unless the mandation deferral period of 6 months applies. For the minority of businesses to which deferral applies, the MTD for VAT obligations commence for return periods starting on or after 1 October 2019.

The announcements in July 2017 around Making Tax Digital placed VAT firmly at the vanguard of the proposals. Finance (No. 2) Act 2017 includes legislation providing for the introduction of MTD for VAT (section 62 - as well as other clauses for income tax). On 13 September 2017, HMRC also published further detail in a legislation overview of the VAT proposals, as well as draft Regulations and Notices for income tax.

Regulations were laid in relation to the VAT requirements in February 2018. Notice 700/22: Making Tax Digital for VAT that provides further explanation of the requirements was published in July 2018. HMRC also released a stakeholder communication pack for advisers, software developers and professional / trade bodies to use with clients, customers and members, and the list of MTD for VAT software suppliers that is updated regularly as new software suppliers complete the testing process. HMRC opened the VAT pilot to sole proprietors and limited companies meeting the entry criteria (as well as agents acting for such businesses) in October 2018, and will expand the entry criteria to the pilot for businesses not affected by the deferral period in late 2018/early 2019. A deferral period of six months was also announced for a minority of qualifying taxpayers.

Headline Challenges

Changes to record keeping - Businesses in scope will no longer be able to keep manual records. Digital records must be maintained in what is defined as 'functional compatible software' - broadly, software or spreadsheets (or a combination thereof) which can connect to HMRC via an Application Programming Interface (API) - and these must capture more information than is currently required to be recorded.


Changes to VAT return submission - VAT returns must be submitted to HMRC by means of a business's functional compatible software communicating digitally via HMRC's API platform, and not by manually entering the VAT return figures onto the HMRC portal. The figures from the accounting software should not be manually rekeyed into another package (say) a spreadsheet, which would ordinarily deal with VAT adjustments or combination of data sources, but those figures should be transferred digitally. There will be a "soft landing" in the first year of MTD, allowing more time for these digital links to be put in place. 'Cut and paste' (and 'copy and paste') can still be used during the soft landing period for transferring data between software packages but not but not for VAT periods commencing on or after 1 April 2020. Please note that we currently understand that the soft landing period for digital links will not be extended for those businesses subject to the deferral to mandation; the 1 April 2020 VAT return commencement deadline applies to all businesses.

Timing - MTD for VAT is still expected to commence from 1 April 2019 for the majority of affected businesses, which is the same time as the UK leaves the EU. Notwithstanding the proposed EU Exit transitional period to 31 December 2020, uncertainty around the VAT treatment of transactions between the UK and EU will inevitably arise, and businesses will need to both understand the tax-technical changes to the rules, and ensure that their accounting systems deal with such transactions correctly. In any event, April 2019 remains a challenging time frame, particularly as the software trials have only very recently been opened to qualifying taxpayers, and the pilot entry criteria will be broadened in late 2018/early 2019 to other businesses not impacted by the deferral period, meaning that the latter businesses may only have one VAT return period for testing before MTD for VAT goes live.

Finance & Bookkeeping

A complete range of accountancy services. Simple book-keeping, payroll, and taking care of your VAT and statutory requirements; right up to full management accounting.

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A range of miscellaneous services to simplify running your company or setting up. Starting with company formation, advice on strategy. For the individual, get that perfect CV written. Families and companies can save money on their utilities.

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