VAT - Get Your money back quickly

[Worcester]

I have previosuly posted about why and how long a VAT application can take (easily 12 - 16 weeks), so I thought this snippet (courtesy of Segen) might help some of you.

Managing your Cash : Monthly VAT Returns

A common problem for solar PV installers working for domestic clients is that they are finding they have to wait three months before they can claim their VAT back.

When purchasing equipment you will usually pay 20% VAT even though you are charging your domestic customers 5%,(708/6 - Energy-saving materials) click here for the details: HM Revenue & Customs therefore you are paying out more VAT each month than you receive.

If you are on the standard VAT scheme you can be waiting 3 months to get your VAT refund claim.

However there is a way around this to make it quicker to get your money back from the VAT man.

See section below from the Official VAT Guide Public Notice 700, section 20. 20.5 Tax periods click here for the details: HM Revenue & Customs (Extracted from the Official HMRC website)

20.5.2 Monthly tax periods
You can ask for monthly tax periods if you normally expect to receive repayments. Remember, if you do have monthly tax periods, you will have to make twelve returns a year instead of four. You cannot have monthly tax periods if your registration is voluntary.
If you have monthly tax periods and you change from receiving repayments to making payments, you may have to change to the standard 3 month tax periods.

In order to apply you will need to telephone HMRC and ask to speak to the Variations Unit. Telephone: 0845 039 0129. You will need the business VAT number and security details (so have your latest VAT return handy). Remember – you must usually be in a refund situation and you will have to submit returns every month