INS12708 – Processing issues: VAT833 Post Deregistration Output Tax

Introduction

Caseworkers should be aware of the possible loss of revenue implications when cases are deregistered and post relevant periods are “Nilled” while there are substantial taxable stocks and assets on hand.

Where an IP has output tax to declare after deregistration of a trader and the post relevant periods are closed then he can account for the tax on a VAT 833.

VAT 833 and payment must be submitted within twenty-one days of the sale.

This situation may occur:

• Where assets, which would have incurred VAT if deregistration had not taken place, come to light at a later date.

or

• Where the Department’s enquiries have concluded that there is no tax due in the post- insolvency period and a mutual nil liability has been assumed.

Procedure

If the caseworker receives a V833 in their post it should be put in a transit envelope and forwarded to the V427 team on Account Adjustments, to be processed.

Tax due on a VAT 833 may be offset against tax claimed on a VAT 426, but may not be withheld over twenty one days in order to effect set off. When a VAT 833 and VAT 426 are submitted together the Remittance Advice Slip will be completed by the V426 Team.