Jay Cooke

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.

Have contacted helpline, they took all the details of the businesses and a week later, nothing has changed, taxpayers still showing as sole traders, still can't import goods into the UK, still no replies from any of my emails to VAT registrations, change of circumstances team or change of entity team, presumably nobody is opening emails in any of these inboxes. Any other suggestions as to how to correct the errors made by HMRC?

So your organisation has received some grant funding and you are contracting with a third party to provide some sort of service and you are paying for that service using the grant funding. You need to be specific as to what these services are that you are buying in.....are the services construction/property related, are they connected to the supplies of education? Taking the lead from HMRC Admin 25's link and assuming the DFE funding is for something education related, if you are paying a third party to provide some sort of vocational training or similar then it could be that the suppliers have to treat their supply to you as "exempt", see section 13 of the link to Notice 701/30 which looks at government funded training schemes....if this is what is happening in your situation then refer the supplier to the above Notice/section 13.

Just to add to HMRC's response, you can never reclaim foreign VAT on a UK VAT return, you can only reclaim UK VAT charged by UK VAT registered businesses on a UK VAT return,....remember how VAT is meant to work between two companies in the same Country. From what you describe, the Italians have correctly charged Italian VAT because they have sold the goods to you in Italy (domestic sale in Italy), title/ownership of the goods moves from Italian supplier to you - physically - in Italy, Italian supplier has then shipped YOUR goods from Italy to Ireland. Technically you have acquired goods in Italy, place of supply of goods is where the goods are at time of sale, as you sold goods that you physically own in Italy, you are required to register for VAT in Italy because you are a UK company, not an Italian/resident company, VAT registration threshold for non-resident companies is Nil....you would register for VAT in Italy, reclaim the 22% VAT charged by the Italians as input tax on your Italian VAT return and then you would make an Intra-EU zero rated sale from Italy to Ireland. If it is a one-off and nobody has noticed then take the 22% hit on your profit margin and don't do it again or if this is going to be a regular arrangement, then consider registration in either Italy (where your supplier is) or Ireland (where your customer is) because whichever you choose, you'll then have a foot in the EU in terms of VAT and so you're not losing out on irrecoverable foreign VAT).