The "challenge" continues.
Just a reminder - EVERY UK VAT REGISTERED COMPANY (that has to be registered) must be using the new "Making Tax Digital" API to submit VAT returns from April 2019. Do not forget!
We have s/w for this (Onion Accounts), tested, and approved, yay!
So we are trying to put the company (A&A) on the "pilot" so we can actually submit our own VAT return using the new system, before it is all mandatory. A final double check that all is working as it should.
We get to authorise it all, using OAUTH, and get an access token for the read:vat and write:vat access. But it does not work, we are told we are not authorised!
Checking the government gateway VAT pages it seems we have to "sign up" for the pilot. That may explain things, except if we are not signed up then why allow us to "authorise" the access? Surely the OAUTH process should be saying "You are not signed up for MTD VAT" rather than giving the access token and the failing when we try and get the VAT obligations? Crazy...
So, let's try and sign up.... Nope. We get "This service is only available to some limited companies, sole traders, partnerships and VAT groups." which is not that helpful.
We also get "You will be able to sign up for this service from April 2019."
Hang on?!?! This is "Sign up for the pilot". Why would I be able to sign up for a pilot in April 2019 when the pilot is surely over (as MTD VAT is mandatory from April 2019)? Surely they are not making people "sign up" for the mandatory process (they call it a "service" which I dislike).
A bit more digging and we find "You will not be able to take part in the pilot at the moment if you:" ... "currently trade with, or have traded with the EU".
Two issues with this...
Firstly, surely you want people on the pilot with the complex edge cases, not the "simple" cases. You want things to break (if they are going to break) in the pilot and not once the process goes live. So why exclude these edge cases?
Secondly, and this is where the mindset has got us brexit, what UK company does not trade with the EU? Hardly any, I bet. All of our customers and suppliers are in the EU! Yes, almost every single one is also in the UK, but the UK is part of the EU.
Is a Dutch company trading with a Dutch supplier, "trading with the EU"? If yes, then so is a UK company trading with a UK supplier. If no, then neither is a UK company trading with that Dutch supplier. Either the supplier (or customer) is in the EU, or they are not. They are not suddenly "not in the EU" if in the same country as the trading party. Next we'll say that trading with someone else in Bracknell is not trading with the UK, it is trading with Bracknell.
The ideas that there is the "UK", and there is this separate non-UK "EU", an idea perpetrated by HMRC in this case, is part of the problem, IMHO.
Update: Sounds like the "traded with EU" restriction goes away next week, so we may be able to make some progress!
Update: (4th Dec) We have "applied" for the trial.
Update: (5th Dec) We managed to file a VAT return, just in time.
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>>>>Is a Dutch company trading with a Dutch supplier, "trading with the EU"?
ReplyDeleteAdmittedly this is what we were taught in my LLB when it comes to free movement rather than trading, but when its within the same state, then it doesn't engage EU rights... So you can't use the EU Free movement rules to bring in to the UK third state family members by moving to say, Wales from England.
Based on that, I would say no, intra-UK and intra-Netherlands trade would not be trading with the EU.
You admit you are talking about a different area of EU law, and then 'based on that',reach a particular conclusion.
DeleteI suspect that the truth of the matter is a little more prosaic. Cross border trading, even within the single market, introduces new complexities, as the single market is not fully harmonised. Regulations often allow local derogations and Directives are subject to local implementation. The single market does in fact allow for diversity and local sovereignty.
You can't 'trade with the EU' as such. The EU is a political union. You can trade with entities outside of your own member state, which brings the added complications such as VAT issues as noted above.
It sounds like my LLB was slightly better taught ;)
I read "trade with EU" as trading with someone that is within the EU, to be honest, and that was the basis of my point - UK companies are as much in the EU and as any other in the EU and not in the UK.
Delete>>>You admit you are talking about a different area of EU law, and then 'based on that',reach a particular conclusion.
DeleteBut its still based on the same principles. Issues related to Free Movement (be it of persons, goods, services and Capital) can only invoked if Free Movement itself is invoked. If you're not crossing an internal EU border, Free Movement isn't invoked.
It'll just be a clumsily worded way of saying "we don't support VAT MOSS". As much as you're trading with an entity in the EU, you're not trading under EU "supervision".
ReplyDeleteAs entities in this country, I believe (happy to be corrected) that you don't follow EU rules and regulations; they are written into UK law and enforced by the UK.
As a side, MTD is a colossal mess!
This might be useful information to you. We have been advised that there are updates to the HMRC platform from 4th Dec that will allow business trading with the EU to join the pilot. We are currently awaiting for this update to be able to test the next phase of our dev. Cheers, Dom.
ReplyDeleteYeh - last line of my post :-)
Deletedoh … I must have glazed over in the Dutch section … ;-)
Delete