Cracking down on VAT evasion
The UK’s HM Revenue & Customs has announced that The Fulfilment House Due Diligence Scheme (FHDDS) opened for registration on 1 April.
The FHDDS aims to ensure that fulfilment houses play their part in reducing abuse of VAT rules by online traders based outside the EU.
Fulfilment houses that are part of this scheme will be required to perform proper due diligence on the goods they fulfil and their overseas clients.
In a statement issued on 1 April, HMRC said: “If you run a business in the UK, such as a warehouse, that stores goods imported from outside the EU that are owned by, or on behalf of, someone established outside the EU, you will need to apply to register for the scheme.
“The deadline for applications from existing fulfilment businesses is 30 June 2018, and businesses that start trading on or after today to 30 June 2018 will need to apply on or before 30 September 2018. There are penalties for late applications.
“Businesses that meet the FHDDS criteria will not be allowed to trade as a fulfilment business from 1 April 2019 unless they are approved by HMRC, and risk a £10,000 penalty and a criminal conviction if they do so.”
