We love acronyms - but
for those of you who don't, all will be revealed below!
The Direct Marketing Association (DMA), working with the
Charity Tax Group (CTG), was pleased to announce recently that an agreement had been reached with Her
Majesty's Revenue & Customs (HMRC) over a number of issues concerning Value
Added Tax (VAT).
The problem was this: the HMRC Guidelines were misleading,
so some charities and direct mailing companies were including the cost of
postage in zero-rated print supply deals, thinking it was perfectly acceptable
practice.
When this was discovered by HMRC, they wanted to charge
retrospective penalties to any organisation which had failed to adhere to the
rules, despite the fact that the DMA and other organisations had sought clarification early on and no
response was forthcoming.
So here's an early Christmas present for all of us,
delivered by the HMRC on December 11th! They have agreed that there will be no penalties, for which our
industry can heave a huge collective sigh of relief since the demands amounted
to hundreds of millions of pounds which we can ill afford.
Secondly, HMRC have agreed to new and fairer rules and given an implementation date of 1 April
2015 to give all of us time to make alternative plans or renegotiate contracts
as necessary.
See Mailing Experts' next blog, after all the seasonal jollities, when we'll explain the new
guidance to you in a language that won't make you lose the will to live…
In the meantime, have a wonderful Christmas and a very Happy
New Year.
