VAT changes to be expected and routine, one exception in this case will be amendments of VAT return surcharges

As regards VAT, the Budget announcements usually include various expected and routine changes, such as:

• increasing the thresholds for registration and de-registration; and

• amending the scale charges for private fuel.

Most experienced practitioners wisely take little significant action in relation to such changes. Some important changes, e.g. regarding record-keeping and partial exemption, are often made by a statutory instrument that is finalised only shortly before the changes apply. Other changes to the law may be in the Finance Bill which are finalised only when the Bill gets Royal Assent which most years is in late July. Some important amendments to the Finance Bill and draft statutory instruments may be made after they were issued in draft form for consultation and before they take effect. Advisers should promptly warn their clients of this possibility.

Many changes that do finally take affect apply to only a few businesses. Thus, most practitioners often do little more than speed read a summary of the announcement.

One important and expected change that will have a widespread effect is the replacement of the default surcharge for VAT returns that are filed or paid late (VATA 1994, s.59) by the penalty in FA 2009, Sch. 55 and 56. It is understood that this replacement may not take effect until about 2013-14. Computer software needs amending and many staff would need training before the commencement date. The transition to the revised system for penalising such lateness may not be easy.