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HMRC internal manual

VAT Small and Medium Enterprises Assurance Manual

HM Revenue & Customs
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The Audit Process: estimation for completion of VAT return: payment offered by a trader

Receipts are not normally required for cheque payments, but if a trader requests one, the officer should write out a manuscript receipt in duplicate and a copy should be retained for scanning into EF.

This should include:

  • payer’s name;
  • date;
  • payer’s VAT registration number;
  • amount;
  • type of payment (for example, VAT);
  • signature of the officer accepting the payment; and
  • on the duplicate (or copy), the words “This is a true copy of the original receipt issued to me”, followed by the signature of the payer and the date.

BACs, Direct Credit and Chaps payments may be made directly to Citi, Citigroup Centre, Canada Square, Canary Wharf, London E14 5LB. The bank account details are

Account name Sort Code Account Number
HMRC VAT 08-32-00 11963155

The trader must include their 9-digit VAT registration number as a reference.

If there is a debt on file, and payment is taken up it is essential that the relevant DMU be notified as soon as possible. Officers should E-mail the caseworker to confirm the amount received, trader name and VAT registration number. Remember to capture the E-mail to EF.

In offices that have a cashier facility, the cheque (and receipt if applicable) should then be handed over to the cashier as soon as possible after the visit. A copy of the receipt should also be sent for scanning to EF. Where there is no cashier facility, the cheque should be placed in an envelope to Shipley, ensuring that the traders VAT registration number is written on the back.

Officers should not offer Time To Pay, however if the trader requests it please make the following clear to them:

  • discussion with the officer does not constitute an agreement of any sort allowing TTP;
  • TTP is purely within the responsibility of the DMU’s. Under no circumstances should it be indicated that the trader will be given TTP;
  • inform the trader that TTP is not a right;
  • inform the trader to submit a request in writing to their DMU; and
  • inform the trader that all TTP requests are dealt with under strict guidelines including the submission of supportive evidence.

Once you have established this with the trader inform them that you will advise the DMU of their financial difficulties in a short report and that you need the following information in order to do this:

  • an explanation why full payment will cause them financial difficulties;
  • the present position with the bank, would they be able to apply for a loan;
  • what income they are expecting over the next few months, any big orders etc; and
  • what payments are they proposing to make to discharge the debt?

Officers should have already recorded details of assets and liabilities in the annual accounts section of their visit report. Bank statements may have also been examined, as part of the credibility checks and to establish future payment compliance, for example is the trader in a healthy trading position.

Once the officer has identified a liability on their visit they should inform the trader that they will be raising an assessment. The trader’s ability to pay can be discussed at this point. Officers will have formed an opinion as to the trader’s credibility and compliance and may advise the DMU whether TTP may be an option in their case.

Officers are advised to follow the guidance above and ensure that the trader understands a TTP request will be considered by the DMU only when made in writing.

A short report of the discussion can be captured on EF in the “brief details” column of the post audit screen in the “VAT Report” drop down menu, along with the officer’s views on acceptance or rejection of TTP.

If a written request is subsequently received in the DMU from the trader, the debt caseworker will check EF for latest information as a matter of routine.