Commons Sense

House of Commons · Written Ministerial Statement

Penalty Reform for VAT

13 January 2022 · Treasury

Proposed by Lucy Frazer Con South East Cambridgeshire

Taxation

Summarised by AI from the official record, so it can contain mistakes.

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At a glance

Key points

  • The VAT penalty and interest charge reforms will be implemented on 1 January 2023.
  • The reforms will now be introduced nine months later than initially scheduled.
  • This delay aims to ensure the systems are well-tested and provide good customer service.

Issue summary

The statement addresses the reform of VAT penalties and interest charges.

Action requested

I am announcing that the reforms for VAT businesses will now be implemented on 1 January 2023, nine months later than initially planned, to ensure well-tested systems and good customer service.

Key facts

  • The Finance Act 2021 legislated to reform penalties for late submission and payment of tax from April 1, 2022.
  • HMRC is committed to being a digitally advanced tax authority.
  • The reforms will be introduced on January 1, 2023.
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