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\n <\/span>\n<\/p>\n HMRC will send a one-to-many letter\u00a0from late January 2024 to businesses that it believes are NETPs for UK VAT purposes. The letter was first mentioned in Agent Update 112. The businesses targeted are likely to be those using either an agent or serviced office address as their place of registration.\u00a0\u00a0<\/p>\n In the letter, HMRC asks the business to provide evidence that it is established in the UK for VAT purposes if it disagrees that it is a NETP.\u00a0\u00a0<\/p>\n HMRC states that, to be established in the UK for VAT purposes, the business must meet at least one of the tests below.\u00a0<\/p>\n UK incorporation does not automatically mean that a business is established in the UK.\u00a0<\/p>\n HMRC is primarily sending the letters to businesses that trade on online marketplaces. Having NETP status means that the marketplace will typically collect output VAT on the business\u2019 supplies and pay it directly to HMRC. NETPs that make supplies in the UK need to be registered for VAT, even if their turnover is below the \u00a385,000 registration turnover threshold.\u00a0<\/p>\n If the business disagrees with HMRC, it needs to submit the relevant evidence within 30 days of the date of the letter. As some of the decision-makers involved in the business may be based outside of the UK, any agents receiving these letters on behalf of their clients should consult with the client as soon as possible. The letter also sets out the procedure required to request a review of HMRC\u2019s decision, or to appeal to an independent tribunal.\u00a0\u00a0<\/p>\n<\/div>\n ICAEW’s Tax Faculty is recognised internationally as a leading authority and source of expertise on taxation. The faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.<\/p>\n <\/p>\n \n<\/div>\n
\n HMRC will contact businesses believed to be non-established taxable persons (NETPs) for VAT purposes. The business will then have 30 days to challenge HMRC\u2019s decision. <\/p>\n\n