Pre-Budget Report 2008 - VAT Rate Changes

On 24 November 2008 the Chancellor announced that the standard rate of VAT will be reduced to 15% on 1 December 2008.

This means that for any sales of standard-rated (currently at 17.5%) goods or services that take place on or after 1 December 2008 providers should charge VAT at the new rate of 15%.

There are no changes to sales that are zero-rated or reduced-rated for VAT. Similarly, there are no changes to the VAT exemptions.

The 15% rate will remain until 31st December 2009, and from 1 January 2010 it will revert to 17.5%.

For a more detailed analysis, and examples, please look on the HMRC website.

What this means to Pegasus Software Users:

Pegasus Opera II Enterprise, Pegasus Opera II Enterprise SQL & Pegasus Opera

In order to minimise disruption to your business, you may elect on the last working day in November 2008 to invoice all possible SOP/Invoicing transactions through your usual means of invoicing. You must process any due Repeat Invoices and any outstanding Credits. This would mean you would Charge output VAT at 17.5% but would ensure a smoother transition to the new rate change.

For step-by-step instructions read: VAT Rate Changes Instructions.doc

Alternatively, Technology Management is offering a VAT Change Utility for a one-off fee of £25 -  saving you from manually entering the changes.

Please call Pegasus Support on 01902 578300 or email pegasus@tecman.co.uk

In order to minimise disruption to your business, you may elect on the last working day in November 2008 to invoice all possible SOP/Invoicing transactions through your usual means of invoicing. You must process any due Repeat Invoices and any outstanding Credits. This would mean you would Charge output VAT at 17.5% but would ensure a smoother transition to the new rate change.

Further information will be published on this page when available.