Changes to Prompt Payment Discounts (PPD)

Julian Rosser Prompt Payment Changes

Changes to Prompt Payment Discounts (PPD)

Senior Tax Manager Julian Rosser highlights the new requirements

In the 2014 Budget, HMRC announced that Businesses will have to adjust how they calculate their VAT to include supplies made to businesses which allow or receive prompt payment discounts (PPD).

At present, HMRC allows suppliers to account for VAT on discounted prices offered as part of a PPD even when the offer is not taken up. This does not cause a problem for VAT because the VAT figure is constant and doesn’t change whatever the customer pays. Continue reading …

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