A St J Price

A ST J PRICE FCA laments the current state of the Department of Customs and Excise.

I BELIEVE THAT Customs and Excise are in crisis. I see much of their routine activity failing due to lack of management, while new initiatives tend to be so poorly planned as to have no prospect of success. I think we are all losing out in consequence, and that worse is to come.

The problem of applying the partial exemption method to a private club is explained by A ST J PRICE FCA.

A ST J PRICE FCA comments on a case where a seemingly good marketing idea resulted in an unexpected expensive VAT bill.

'WHAT DO YOU know about the difference between a multiple supply at two different rates of VAT and a compound or composite one covering various elements but at the same rate?' I asked.

'Try me,' replied the Busy Practitioner.

A ST J PRICE FCA explains how gaining an understanding of the relevant industry helped him win a case before the VAT tribunal.

'TO ADVISE ON value added tax properly, you have to know the nature of the business in question', I said. 'When I was a finance director in industry, I never dreamt I would end up as a tax consultant. This, however, being my fate, it is the need to understand the businesses with which I deal, which is a key reason I stay interested after 25 years.'

'Surely, to get the tax right, you just need the facts', rejoined the Busy Practitioner.

A ST J PRICE FCA argues that the VAT flat rate scheme for small businesses will prove to be of little advantage to many of the businesses at which it is aimed.

'SADLY, I THINK the new flat rate scheme for small businesses will indeed fall flat on its face!', I muttered. 'It looks to me as if many users will pay more VAT under it than they would under the normal rules.'

Individuals and businesses can find themselves caught out by the export rules, warns A ST J PRICE FCA.

'DID YOU KNOW', I asked, 'that it can be an expensive mistake to bring goods into the United Kingdom, which you might have to re-export?'.

'Not from a tax point of view, surely', rejoined the Busy Practitioner. 'One gets the import VAT back whatever one does.'

The liability to VAT of payments made to professionals relating to outside appointments depends on various factors, says A ST J PRICE.

BIRKETTS (17515) COULD BE very helpful to professional partnerships and sole practitioners, who have income from outside appointments', I observed. 'It suggests that Customs may be wrong if they say that the fees for serving as, for instance, a non-executive director of a National Health Service trust, are standard rated.'

A decision concerning the conversion of a public house is examined by A ST J PRICE FCA.

'THE LADY BLOM-COOPER (17481) decision could be worth money to some private clients', I observed. 'Lady Blom-Cooper was held to be entitled, under section 35(1D), Value Added Tax Act 1994, to a repayment of the VAT incurred in converting a public house into a house. Customs said she was not, because the finished result incorporated an existing flat.'

Author's advance
I see that the replies to a query about an author in the issue of 14 September 2000 at page 629 did not mention VAT. The query concerned advances paid to the author which would be partly repayable to the publishers if sales of the forthcoming book did not reach a specified level. The damage from failing to appreciate the need to register for VAT could be both greater and more immediate than the direct tax points discussed.