A client of ours decided to engage a freelance bookkeeper and move the maintaining of their books and records in-house due to the implementation of Making Tax Digital. 

During the first year, our client expressed concern that the VAT liability seemed excessive; however, the bookkeeper assured our client that the returns were correct. At the end of the company’s financial year, we began to prepare the accounts and came across multiple errors which we brought to our client’s attention.

Due to the sum of errors, totaling £15,051, we had to provide HMRC with a VAT652 form disclosing the details of errors on the previous VAT returns before making any adjustments.

If you have made an error(s) in a previous VAT return, you must inform HMRC and can use the VAT652 form to do so. You can include the net value of the adjustment in the VAT return for the period of discovery if the net value of the errors does not exceed £10,000 or 1% of the box 6 figure.

HMRC replied to us requesting further information to which we quickly supplied them with. HMRC have again recently come back to us confirming the VAT refund of £15,051 which has successfully been issued to our client.

For further information or help on notifying HMRC of errors, please do not hesitate to contact Jake on 01227 277667 or by emailing him at j.mackenzie@mphaccountants.co.uk.

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