Beware VATbullies, warns tax specialist

Fred Cowgill, VAT specialist on apportionment and the optical profession, claimed this week that officials from Customs & Excise had been approaching practitioners and contesting existing methods of VAT accounting. And despite being beaten in court, C&E 'continues to plague opticians' to the detriment of some businesses, with effects 'which could be potentially crippling for the UK's small and medium sized opticians'.
'If you get a visit you mustn't automatically give in to their demands,' Cowgill, managing director of C&C International, warned.
'It would be tempting just to agree to get them to leave you alone, but you need to speak to a professional adviser like your accountant or VAT consultant.'
It has been reported that Customs will accept any type of apportionment calculation that shows a 60:40 ratio, though C&C pointed out that 60 per cent being handed over to the taxman and 40 per cent exempt was not a favourable deal for the practitioner. It was feared, the Bristol-based business claimed, that Customs could use such arrangements to press for increasing the apportionment to 70:30, thus giving a further boost in revenue to the taxman.
Cowgill advised: 'You need to ensure if customs want to visit you, you and your adviser are prepared for that visit. You also need to make sure you are not bullied into variations to your VAT accounting system before you have sought advice. Customs seem to be using the successes they are having elsewhere to bully opticians into changing their methods of apportionment. Trade organisations, such as the Association of Optometrists, may also be able to help.'
It is claimed the AOP takes around eight calls a day on the matter.
Cowgill, a veteran of the many disputes the profession has had with Customs, was saddened by what he claimed was the actions of government officials. 'Yet again we find that Customs are attempting to change the way in which opticians account for VAT. Yet again they appear to be tearing up national agreements and dismissing out of hand existing methods of accounting, even though some local Customs staff have agreed them.'
Customs' response next week.
david.challinorrbi.co.uk