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VAT reverse charge delay gets thumbs-up
S
CABLEtalk is the official magazine of SELECT and is distributed free to qualifying readers.
ISSN 1365-3288 SELECT is the trading style of the Electrical Contractors’ Association of Scotland. Te SELECT logo is a registered Collective Mark.
ELECT and other major construction industry bodies have hailed the decision by the UK Government to delay major changes to the VAT regime. The announcement of
a one-year extension to the
launch of the reverse charge was met with a widespread positive response from leading UK trade bodies, which had written to the Chancellor of the Exchequer asking for a delay to the plans amid fears of a negative impact on the industry. SELECT was among 15 organisations
which pressed for a postponement of at least six months to implementation for building and construction services.
The measures – which mean the customer receiving the service will have to pay the VAT due to HMRC instead of paying the supplier – were originally intended to come into force in October 2019, but will now be introduced in October 2020.
Alan Wilson, Managing Director of SELECT, said: “Along with other organisations which wrote to Chancellor Sajid Javid, we are pleased that the serious concerns we raised have been listened to and acted upon. “If the changes had been implemented precipitately, they could have further increased the burden on construction employers and seriously restricted cashflow.
“We are pleased that the serious concerns we raised have been listened to and acted upon”
“Another year will give SELECT member businesses and other companies in the construction sector the breathing space they need to alter their systems and processes.” A spokesperson for the VAT Serious Non-Compliance and Policy Team said: “The Government has listened to the concerns raised by industry representatives and recognises that some businesses in the construction sector require more time to implement the VAT domestic reverse charge.” The change will mean businesses which are
both VAT and Construction Industry Scheme registered will no longer pay VAT to the majority of their subcontractors. Instead, it will only be paid to firms who supply only labour and to the merchants and businesses that sell building materials without any fix.
NEW MEMBERS 14 firms have become SELECT Members since August 2019
DSB Electrical Services, Lanarkshire
2 Core Electrics Ltd, Lanarkshire
Loreburn Housing Association, Dumfries and Galloway
Complete Electrical Solutions (Scotland), Tayside
J H Johnstone & Sons, Dumfries and Galloway
6 CABLEtalk OCTOBER/NOVEMBER 2019
Park Electrical (Scotland) Ltd, Tayside
Cross Electrical Contracting, Lanarkshire
Byers Brae Electrical Ltd, Glasgow and West of Scotland
MGB Services Ltd, Lanarkshire
Summit Facilities Services Ltd, Tayside
M2 Electrical and Data Services Ltd, Glasgow and West of Scotland
AYE Allan Young Electrical, Ayrshire
A.T. Electrical, Lanarkshire
Novus Elements Ltd, Aberdeen and North East Scotland
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