The UK is updating its system so that non-established taxpayers (NETP) can receive VAT refunds directly in their non-UK bank accounts. NETP are registered for VAT in the UK but do not have a local business address.
Reasons for the update
Currently, when NETP are due a VAT repayment, the HMRC system automatically issues a payable order. However, HMRC says it has received notification that customers can no longer cash their payable orders in their resident countries or with their local banks. HMRC ascribes the issue to Brexit and Covid.
HMRC developing new form for NETP
In response to the issue, HMRC is creating a form through which NETP can send their bank account details. HMRC will then set the system not to automatically issue a payable order. Instead, a Clearing House Automated Payment System (CHAPS) VAT repayment will be issued.
How to take advantage of the new service
Affected traders that would like to take advantage of the direct repayment option must enter their details on the new form. The form is accessible via the government gateway service.
The following information is required by HMRC:
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