Postponed VAT Accounting

Postponed VAT Accounting

 

Many customers have asked about Postponed VAT Accounting , or “PVA” as it is being acronymised.

HMRC has issued many updates to its website on this and many other new procedures following our exit from the EU in January this year. But the most recent email which they have been sending round is by far the most explanatory, so the main points are repeated below which I hope you will find useful.

Question 1: I’ve heard about PVA, but I’m not sure if it’s for me. Why should I use it, and where can I find out more about it?

Answer: PVA allows UK VAT registered importers to account for and recover import VAT on their VAT return. PVA is available permanently and we expect that most businesses will choose to use it, because it provides significant cash flow benefits compared to the alternative of paying the import VAT when the goods are imported.

Question 2: How do I tell HMRC that I want to use PVA?

Answer: There isn’t an application process for PVA, and you do not need to tell HMRC in advance if you want to start accounting for import VAT on your VAT return. You need to confirm in your customs declaration that you are using PVA.  If someone else is doing your customs declarations for you such as a freight forwarder, customs agent, broker or fast parcel operator you must tell them you want to use PVA. Tell them that you want to use PVA to account for import VAT on the imported goods, so that they can complete the customs declaration correctly on your behalf. Keep a written record of what is agreed for your records.

Question 3: How do I complete my VAT return if I’m using PVA?

Answer: After you have selected PVA on your customs declaration you will need to account for import VAT when you complete your VAT return.

To complete your VAT return, you will need:

  • details of any customs entries you have made in your own records
  • copies of your monthly postponed import VAT statement, when available.

Unless you have delayed your customs declaration, each of your statements will show the total import VAT postponed for the previous month.

Question 4: How do I get the statement I need to complete my VAT return?   

Answer: If you account for your import VAT on your VAT return, you’ll need to get a postponed import VAT statement online.

Your statements will usually be available to view by the 6th working day of the month.

To view your statements, you’ll need a Government Gateway user ID and password which is linked to your EORI number. If you do not have a user ID and password, you can create your account on GOV‌‌‌‌.UK.

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