Policy paper

Draft Legislation: VAT: tackling aggressive abuse of the Flat Rate Scheme

This draft legislation explains VAT, tackling aggressive abuse of the Flat Rate Scheme.

Documents

VAT: tackling aggressive abuse of the Flat Rate Scheme

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Explanatory memorandum to VAT: tackling aggressive abuse of the Flat Rate Scheme

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Details

The measure will introduce a new 16.5% FRS rate for businesses with limited costs, such as many labour only businesses. This will prevent abuse and make the FRS fairer. This will reduce the incentive for firms and agencies to move employees to self-employment to exploit VAT simplification aimed at small businesses.

A tax information and impact note has also been published.

Published 5 December 2016