In a previous blog we set out the facts surrounding HMRC’s policy statements in ongoing discussions with the Direct Marketing Association (DMA). Since then, representatives from both the DMA and Charity Tax Group have met with HMRC to seek further clarity on the stated policy.
Mike Lordan of the DMA has provided his summary view of the events of the last meeting in his blog.
As ever with these matters, the devil is in the detail. HMRC acknowledged the points discussed and gave verbal assurances but it will only be when things are confirmed in writing that we will know the exact details and implications for the past and going forward.
On the face of it you might think that this latest information provides for all suppliers to single source postage and other services up until April 2015 with impunity, or to refund VAT which may have been charged to date. We need to exercise some caution here. Part of the rationale for extending the deadline to April 2015 was to allow suppliers to extricate themselves from binding contracts. If for example, a business started single sourcing print and postage from today, when no previous contract existed, HMRC might take a dim view of this because it is not part of “existing arrangements”.
In all likelihood, the industry will take this recent information and interpret it every which way leading to yet another period of flux and confusion! If you are in any doubt you should seek professional advice.