Government Delays VAT Rule Change for Construction Businesses

On Friday 6th September the Government announced that they are delaying the introduction of the domestic reverse charge for construction industry businesses by one year.

The new rules had been due to take effect at the beginning of next month, but it has now been confirmed as delayed until 1 October 2020. 

The official announcement can be seen on the Gov Website.  The change has been made following representations from construction industry bodies who felt that many businesses would not be able to make the changes in time, and also to avoid further complications arising from Brexit happening around the same time.  

The government has confirmed that they will take a light touch with any errors arising for businesses that have already made changes to their systems to take effect from October 2019 who then encounter problems switching them back.  Other traders who anticipated getting regular repayments and have opted to switch to monthly VAT returns can use the HMRC online account to change this back to quarterly stagger dates.