Partial exemption laws 'should be aligned with Europe's'

News Article - 24 May 2012
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UK tax laws in relation to partial exemption should move in line with those of Europe, according to the Institute of Chartered Accountants in Scotland (ICAS).

The accountancy body states that partial exemption rules are complex and difficult, causing concern to many companies and organisations, from schools and colleges to bookmakers and funeral directors.

ICAS is now calling for the regulations to be simplified to reduce the burden upon companies while also enhancing the accuracy of VAT returns.

Robin Hume, convener of the institute's VAT committee, said: "The present patchy approach of partial exemption places UK businesses at a competitive disadvantage to their European counterparts.

"We're recommending a major revamp and review of this complex tax law to help UK business compete fairly in an open market."

The most effective way of achieving these goals would be for the UK's tax laws to be aligned with those of Europe, he recommended.

Firms can find out more about the regulations in sections 24 to 26 of the Value Added Tax Act, 1994.

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