Bespoke schemes: practical guidance: Negotiating a bespoke scheme
Businesses are advised in Notice 727 VAT Retail Schemes and Notice 727/2 Bespoke retail schemes to monitor their turnover to ensure that, if they think they might exceed the £130 million threshold and need to continue to use a retail scheme, they make early provision for negotiating a bespoke scheme with us. Remember, it is the retailer’s responsibility to approach us with proposals for a bespoke scheme.
The bespoke scheme should be negotiated with the officer responsible for the business with assistance provided by the team responsible for auditing the business’s systems.
When considering such proposals, you should satisfy yourself that:
- the total of the business’s retail supplies exceeds the £130 million threshold;
- the business cannot reasonably be expected to account normally; and
the method proposed by the business produces a fair and reasonable result. This means, amongst other things, that it relies on accounts and systems that are relatively uncomplicated and easily auditable by HMRC. (For more information on what constitutes a fair and reasonable result see VRS6150) In all cases, the Customer Compliance Manager (CCM), the Retail UoE, and VATAPPS Accounting Policy will be available to give advice. In the most complex and contentious cases, it may also be necessary to seek advice from an HMRC solicitor, but this must only be done after consultation with the CCM, the Retail UoE, or the policy team.