Small businesses claiming back overpaid VAT may be due more cash than expected, it has been claimed.
A recent ruling has stated the three year deadline on claiming back overpaid VAT is contrary to EU law. As a result, companies now have until March 2009 to claim back payments dating as far back as the 1970s.
According to Andrew Stephenson of accountancy firm Pierce, many small business owners are unaware of their right to claim overpaid VAT this far back.
“It’s not very often here in the UK that one will hear business people say thank goodness for the EU,” he said.
“This money may not be much for smaller businesses, but in the current economic climate, every bit helps and it is important to take action.
Stephenson advised business owners who think they are due some money back to contact their accountant for advice on making a claim.
Businesses can claim overpayments as far back as 1 April 1973 for input tax (VAT charged by suppliers to a business) not claimed but due for periods up to and including 1 May 1997.
They can also claim output tax (VAT charged by a business to its customers) overpaid or over-declared for periods up to 4 December 1996.
© Crimson Business Ltd. 2008