Jay Cooke

If you are saying the club is not VAT registered but the bar is, then that would indicate that the bar is a separate legal entity (Ltd) to the sprots club which is likely going to be a limited by guarantee entity or some form of association or unincorporated body, but the point being is that a VAT registration belongs to the legal person/entity, so if the bar is VAT registered and the club is not, then there must be two different legal entities in play here. Why would you therefore need another Ltd to trade sports equipment? You already have a Limited company (the bar) that makes taxable sales and so why create another (third) company just to buy sports goods to sell or rent back to the main club? There are costs associated with setting up and maintaining companies, filing requirements, etc. But you can setup any number of companies if you want to, but comes back to the big question, why? If you are happy to have a NewCo that buys/sells sports equipment and you want to keep that trade separate from the bar (perhaps different ownership for example), many golf clubs often have the pro-shop as a separate company. You have used quotes marks for "trading entity", either the business is trading or it isn't, definitions can be found here https://www.gov.uk/hmrc-internal-manuals/business-income-manual/bim20000 and you need to be comfortable with the definition of business income. Without details as to what you are buying, what scale, how often, costs involved and expected profits then it's difficult to say whether your plans are a business or not. But lets say the plan is to buy a new lawn mower costing £100k + £20k VAT for use by the Club and other clubs...NewCo could reclaim the VAT on the purchase and then would charge VAT on the hire/rental to the Club and other Clubs. That seems like a business which has regularity (monthly rental), consistency and purpose. Any such rent/hire fee would need to be market value where the supplier is VAT registered but the supply is made to a non-VAT registered business that is connected to the supplier (ie Club is connected to the NewCo). So you can't by the mower (in my example) and then rent it for £1 per year to the Club. See link here https://www.gov.uk/hmrc-internal-manuals/vat-valuation/vatval07300 You don't state what your role is at the club, a member is not necessarily on the committee, but if you are responsible for the financials of the Club then you really should be seeking advice from your Accountant or speak to the members as one of them will be a retired Accountant for sure!

If you register for VAT from May 2021, then you will owe output tax (VAT) on any sales you made from that date, as you are stating this is a voluntary registration (meaning you are below the VAT registration threshold but want to register anyway), if you register from May 2021 then you potentially owe a lot of money to HMRC for all sales since May 2021. Annual Accounting is not as simple as first seems, you will need to estimate the value of your sales and purchases and calculate the net VAT liability you owe to HMRC over a 12 month period and you then set up a direct debit to pay HMRC each month a set amount, regardless of what your actual sales/purchases are, you file a single annual return and make any balancing payment or if you are due a refund you would file the annual return and receive the refund at the time the annual return is filed. See this link, section 3.2 to read about how your annual return date is calculated. https://www.gov.uk/guidance/vat-annual-accounting-notice-732#how-the-scheme-works

Since Brexit, the UK is not in the EU so UK is no longer required to issue invoices with "subject to reverse charge" although it is still helpful to include such wording if only because the recipient knows they have to do something on their VAT return.....but there is no legal requirement for a UK company to state reverse charge is applicable. The UK supplier of "due diligence services", if they are engaged to supply the service to your UK entity, then that should have been subject to UK VAT (UK supplier to UK customer). There is a separate argument as to whether the due diligence" services are land related services, if they are land related then the place of supply could be Germany but that would mean the UK supplier is required to register for VAT in Germany and charge German VAT. If you treat the invoice as reverse charge then there is no loss to the revenue/minimal risk, it would be an issue if you are partially exempt because you would be declaring output tax in Box 1 but not reclaiming the full amount in Box 4, perhaps query the VAT position with the supplier, it does not send a good message where you are seeking due diligence/professional services and the VAT treatment is not made clear to you (in terms of as to why no VAT has been charged)...maybe something as simple as the supplier has invoiced your German establishment but still no requirement on the UK to add "subject to reverse charge" on the invoice.

Might be a language thing but how can "a client" (indicating a single business) have three separate VAT numbers? So presumably you mean you have a client that has several subsidiaries or associated companies and each of them have their own VAT number. The reason VAT652 requires the declaration to be made per quarter is because HMRC need to calculate the interest and penalties that may be applicable, and that can only be calculated by knowing when the VAT was due to HMRC and when the VAT was paid to HMRC...or if this is a refund, HMRC still prefer the error declaration to be made per quarter because they can then update their records and VAT accounts per quarter/correctly. You cannot submit a VAT652 for different VAT numbers, one VAT652 = one VAT number. If there are genuinely three different VAT numbers then the declaration - be it a refund or payment to HMRC - has to be declared separate for each VAT number. There is no such thing as a "deemed" group, the companies are either in a formal VAT group, where if they were, the three companies would have one VAT number shared across all three companies ...if not a VAT group then each entity must make it's own VAT652 declaration. You could always submit a single period for each VAT number, but then be prepared for HMRC to query this which will only delay the outcome.

The sale of royalties or intellectual property (IP) would be a taxable supply. Where you are selling the "rights" to use text or photographs, that is also a taxable activity. You then refer to the place of supply of services rules https://www.gov.uk/guidance/vat-place-of-supply-of-services-notice-741a and if your customer (the one buying the rights) is in UK, then UK VAT applies, if the customer is outside of the UK then your supply would be outside the scope of VAT.

You cannot reclaim Irish VAT on your UK VAT return, indeed you can only ever reclaim UK VAT on a UK VAT return. So this will just be an irrecoverable amount reducing your profit margin on this sale. Your need to be clear with your freight agent as to the Incoterms, these determine who pays the import VAT, even if your Irish customer does not have a PVA, it is still possible for the Irish customer to be liable for the VAT but in the absence of clear instructions from you, the freight agent will go for line of least resistance, treat you as liable for the Irish VAT and recharge it back to you. You may be able to go back to the freight agent and ask them to amend their import entry, but they may charge a fee for this and so depends on how much Irish VAT is at stake and then for the future, ensure that the shipping instructions are that the customer pays the import VAT whether they have a PVA/Irish VAT number or not.

If you have regained access to your government gateway (HMRC online services), there is an option to deregister for VAT amongst the menu options. Try "Manage my VAT Account" and then look for "Cancel my VAT registration", answer a few questions (the same questions as asked on the VAT7) and then the de-registration should be processed in a couple of day, you can log back onto the website to check progress. Technically if you are not making taxable sales and you do not intend to make taxable sales, then you should not be VAT registered, so you were doing the right thing by submitting the VAT7 but these forms often get lost in the post.

Depends what you intend to do with the property. If you intend to rent it to tenants, then you may need to consider opting to tax the property https://www.gov.uk/guidance/opting-to-tax-land-and-buildings-notice-742a If you intend to use it/occupy it yourself with your own business (the same business which owns the property) then no requirement for an option to tax. Rent is exempt, so if renting to a tenant(s), you can't charge VAT and if you are not charging VAT you cannot reclaim VAT. If you opt to tax the property, rent turns from being exempt to standard rated, you can then reclaim VAT on the purchase. But you should seek professional advice and read through the Notice in detail because there is a lot to go wrong here and an option to tax is irrevocable for 20 years once set so you need to be clear at the start....and that depends on who you plan to rent to, new start-up tenants aren't necessarily going to be VAT registered so 20% VAT on rent might price them out of the market, but if your market is high-end then maybe not matter so much. As it will be a first VAT registration and a large refund, HMRC will enquire into this VAT return once you file it, so it is essential you are clear as to your intention with the property.

Who is going to be the importer of the goods into UK, you (Company 1) or the customer (Company 2)? In other words, what are the Incoterms for the shipment?

HMRC have replied to me and accepted it is a known error but their solution is not a solution either for the present situation or all future VAT registrations. The solution is for me to call the VAT helpline (30+ mins), request paper VAT1 forms (10 days in the post), then to submit entirely new VAT registrations using the paper forms which will need the taxpayer to wet sign which involves sending documents international recorded delivery (another 10-20 days), post the VAT 1 to HMRC for manual processing. I also have to get the taxpayer to sign a VAT68 "transfer of a VAT number" (and we know that team takes around 1-3 months to process) and in addition, I also have to send a document which states the VAT registration was issued in the wrong name, signed by the taxpayer and so the client will think I've made a mistake. I have to do this for the 4 clients HMRC have made this error on, I can't bill my client for the extra hours it will take, my client cannot import anything whilst waiting for all these forms to be processed manually by HMRC. Is there not a more logical solution, like HMRC accepting their error and pressing a button to change registration from sole trader to corporate entity? Usually when someone makes an error, it is for them to correct, but here HMRC are wanting me to invest hours to correct their error? Can HMRC Admin escalate this and get someone to contact me with a better solution please because "redo everything you've done but using paper forms" isn't a solution.