The Government has announced that it is delaying the implementation of the VAT domestic reverse charge until 1st October 2020 following concerns raised by industry representatives. It will give businesses more time to prepare and avoids the changes potentially coinciding with Brexit. 

The reverse charge will mean the customer receiving the specified service will have to pay the VAT to HMRC, as opposed to the supplier paying. The customer can then recover the VAT, subject to normal VAT recovery rules.

Those businesses that have already opted for monthly VAT returns on the back of a 1st October 2019 start date, can reverse it by using the appropriate stagger option on the HMRC website.

HMRC has stated that the government remains committed to the introduction of the reverse charge and over the next year will work closely with the sector to raise awareness and provide additional guidance and support to make sure all businesses will be ready for the new implementation date.

Click here to find out what The Property Quarter is doing to support businesses with the move to VAT Reverse Charge.

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