Laura Manton, Director and Tracey Pugh, Legal Assistant in the Wills, Probate and Trusts Team will be putting on their running shoes to take part in one of the most challenging 10km runs in the country They will be running the Beachy Head 10km which is...
In order to combat ‘missing trader’ fraud, which is estimated to have cost the Exchequer hundreds of millions of pounds, HM Revenue and Customs (HMRC) have introduced measures which can, in some circumstances, make a supplier (or customer) responsible for its customer’s (or supplier’s) VAT.
The measures will apply when the goods dealt in are any of a number of electronic goods and where you should have reasonable grounds to suspect that VAT will go unpaid. It is thought that this could lead to businesses being caught out as a result of taking insufficient care, rather than being complicit in VAT fraud.
In order to minimise risk to your business, if you deal in such items you need to take ‘reasonable steps’ to establish the integrity of those with whom you have dealings. To do so, you should consider the following:
- obtaining and checking their VAT registered number and, for a company, verifying its registration with Companies House;
- carrying out credit checks and obtaining third-party references; and
- checking that the business’s trading address exists and is a business premises, not a serviced office or PO box location.
HMRC recommend that extra care is taken when a deal is offered to you which seems to be particularly advantageous.