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HMRC internal manual

VAT Valuation Manual

Special valuation provisions: the procedure for issuing a Notice of Direction

  1. The Notice of Direction should:
    1. Be given in the form shown at VATVAL07800
    2. Not deviate from the wording shown at VATVAL07800
    3. Not refer to any other matters;
    4. Have the trader’s full name and address;
    5. Have the address of the relevant HMRC office;
    6. Bear the date of posting (or date of delivery if by hand);
    7. Be signed by a Senior Officer or above.
  2. The date from which the notice is to become operative should be at least 7 days later than the date upon which the notice is being issued.
  3. Only allow a longer period where the trader requests a short period of grace for administrative reasons such as to revise accounting arrangements or update computer programmes
  4. If considering a longer period, you should take the potential loss of revenue into account.
  5. Notices to partnerships must be addressed to the precedent partner (except in Scotland where the notice may be addressed in the name of the firm). In cases of doubt, issue a copy to each partner.
  6. Date and post the original of the notice to the trader’s last recorded address or deliver it by hand.

A copy can be sent by e-mail, if the protocols with the business allow this means of communication.

  1. Stamp the certificate of issue on the duplicate copy of the Notice and sign it. The certificate must be in the form set out in VATVAL07800 and VATVAL07900
  2. Note the issue of the Notice in a central register maintained in the VAT Office.
  3. File the duplicate Notice in the trader’s records e.g. Electronic Folder.
  4. Retain evidence of the proper authority for as long as the Direction is in force.

You will find some examples of direct selling arrangements and their treatment at VATVAL08000. If a trader claims that an error in the issuing of a Notice has invalidated it you should contact VAT Supply Team for advice.