Q&A: VAT returns on-line only from 1 April

Significant changes in the way many farmers submit their VAT returns and pay their VAT dues are on the way.

From 1 April 2010, filing returns by post will no longer be an option for a large number of businesses, which will have to make returns online. Cathy Meredith of the Institute of Agricultural Secretaries and Administrators (IAgSA) answers some common questions

Who will this affect?

All businesses that have an annual turnover of £100,000-plus. This will be calculated over any 12-month period ending on or after 31 December 2009.

If you do have to submit your VAT returns online, HM Revenue & Customs (HMRC) will send you a letter in February 2010 telling you this.

How will turnover be calculated?

HMRC will look initially at the VAT returns you have submitted for VAT periods covering the 12 months ending 31 December 2009.

The amounts you have entered in Box 6 of these returns will be added together, as this shows your total turnover, excluding VAT.

What do you need do to register for online VAT submission?

The first task is to register on the Government Gateway, which is the centralised registration service in the UK.

To register, a farming business is required to sign up as “an organisation”, even if trading as a sole trader. As soon as you’ve registered, you will see a user ID on your screen. You will need to use this, along with a password, every time you log on to the Government Gateway.

What happens next?

Once you have registered with the Government Gateway, you need to enrol in the VAT Online service. To complete this operation you will need the following five pieces of information:

1 Your VAT registration number
2 The postcode of your principal place of business
3 Your date of registration for VAT
4 The final month of the last VAT return you submitted
5 The Box 5 figure from the last VAT return you submitted

You will be able to find this information from your VAT4 Certificate of Registration and the last VAT return you submitted. If you can’t find your certificate, ring the HMRC helpline on 0845 010 9000 and you will be sent a copy within seven days.

How do I activate my account?

You will be able to submit your VAT returns as soon as you’ve registered. But before you can start using other VAT online services you’ll need to wait for an activation code – also known as an activation PIN – to be sent to you by post.

This must be activated within 28 days.

What if I do not have broadband connection?

You don’t have to have broadband. The form comprises only nine boxes to fill in and can be successfully done via dial-up or WAP on mobiles.

What if I don’t have a computer?

You can still keep your records on paper but, if you are not able to submit your VAT return electronically, you will need to appoint an agent. This could be a farm secretary or your accountant, who will register to use the HMRC online service and enroll for the VAT for agents service.

Once they have done that, you will receive a letter asking you to confirm the request.

What can I do now?

You don’t have to wait until 1 April to register for online VAT submission. Start the process now and then any problems can be dealt with before the deadline date.

If you need further support, contact the Institute of Agricultural Secretaries and Administrators (IAgSA) and they will put you in touch with a farm secretary working in your area. Contact: Charlotte O’ Kane on 024 7669 6592 or IAgSA@IAgSA.co.uk

And remember, if you submit your VAT return online, you must also make any payments due electronically. Full details of how to do this can be found on the HMRC website