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Businesses may have overpaid VAT on customs declarations after system glitch, Government warns

1 min read

The government has issued new guidance to businesses who may have unduly overpaid VAT on declarations made at the end of last year due to technical issue with the Customs Declaration Service (CDS).

On 30 December, a system update caused the CDS to duplicate VAT charges on certain declarations.

Although the issue was quickly fixed, HMRC last week contacted customers using Duty Deferment Accounts (DDA) to recommend that they submit a Current Month Adjustment (CMA) form to correct any overpayments.

Since last week, the Joint Customs Consultative Committee (JCCC) has since issued new guidance to the industry for users who couldn’t benefit from this solution.

This includes the following steps:

  • If a customer is VAT registered and uses Postponed VAT Accounting (PVA), review new guidance on regarding how a correction can be made through a PVA statement on the next VAT return
  • If a customer is VAT registered but payment was made by an immediate payment or cash account, the easiest way to recover overpayment is on the next VAT return
  • If a customer is not VAT registered and paid by either an immediate payment or cash account, and did not submit a CMA last week, an Import VAT repayment can be made using the C235 form on CDS

Support for Staffordshire businesses that import and export is available through Staffordshire Chambers of Commerce. Contact their award-winning trade team, here.

Tom Hammersley

Digital Content Officer at Staffordshire Chambers of Commerce. BA hons journalism graduate.

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