5. Returns
Your responsibilities when submitting returns.
When submitting a paper return, you should not attach any other documents or cheques.
The great majority of businesses must file their returns using functional compatible software and pay any VAT due electronically. The only exceptions to this are businesses subject to an insolvency procedure and businesses who have been granted an exemption.
If a business is exempt from submitting a software return or an online return then the alternative is a paper return.
The insolvent business has responsibility for submitting pre-insolvency returns. But, the office holder may submit a return for any pre-relevant period for which the trader has not submitted a return.
Leave the return unsigned, but add the legend, ‘completed from the books and records of the company or trader’.
The final pre-insolvency return covering the period up to the relevant date will be issued automatically to the office holder. This return will not be subject to default surcharge.
When the relevant date falls within a prescribed VAT accounting period for which no tax liability has been declared, VAT Returns will be issued covering the immediate pre and post appointment accounting periods.
VAT Returns issued for the:
- outstanding pre-appointment period run from the beginning of the prescribed accounting period to the day immediately prior to the date of appointment
- first post-appointment VAT accounting period run from the date of appointment to the end of the next prescribed accounting period
Returns will be issued automatically to the office holder on a monthly or quarterly basis as appropriate.
The office holder has legal responsibility for completing and submitting post-insolvency returns and accounting for any tax due, with these exceptions:
- voluntary arrangements
- deeds and schemes of arrangement
- county court administration orders
5.5.1 Penalties due under VAT Act 1994
VAT default surcharge, VAT civil penalties and VAT default interest are not normally applied to post-insolvency VAT Returns, except in the case of:
- administrations
- partnership administration orders
- deceased persons’ administration orders
- deeds and schemes of arrangement
- Scottish trust deeds
- county court administration orders
- voluntary arrangements
5.5.2 Inaccuracy penalties due under Schedule 24 FA 2007
Inaccuracy penalties due under this act are applied both before and after insolvency VAT Returns and relevant documents in all cases. Factsheet CC/FS7a provides details of the penalty for the inaccuracies regime.
Returns submitted showing a repayment due to the business will be repaid in the name of the insolvent business, care of the office holder.
We aim to make the repayment within 30 days of receipt of the return, subject to verification of the declaration. Repayments will be delayed if:
- the form VAT 769 is inaccurate
- you have failed to notify us of the appointment of the office holder
We may make repayments for:
- businesses in voluntary arrangements
- deeds and schemes of arrangement
- county court administration orders
We have the right to check the accuracy of all returns submitted and to require that the books and records of the business be made available for inspection.
In certain circumstances, when it can be shown an office holder has consistently not complied with regulations, a report may be made to the appropriate licensing authority.