Last week HMRC announced their plans for VAT if the UK ends up leaving the EU in March 2019 without a deal. They have emphasised that the government is confident a deal will be reached, but they are introducing contingency plans as a precautionary measure.
The update today has announced very little in the way of VAT changes. They reinforced their attitude towards tax avoidance by confirming that a new penalty regime will be introduced for those involved. They also commented that they were specifically focusing on shutting down inappropriate use of the flat rate scheme.
This week HMRC have announced their intention to introduce a new section, 33E of the VAT Act 1994, to prevent VAT being a barrier to non-departmental public bodies who enter into arrangements to share back office services that would otherwise result in greater efficiencies. This puts the VAT position for government departments, NHS bodies and non-departmental public bodies on a similar footing. In line with the other departments who are able to claim similar services under section 41 (3), they will have a shorter period in which to claim a refund.