There were no changes announced to the rate of VAT.
The VAT registration and de-registration limits have been increased with effect from 1 April 2014 to £81,000 and £79,000 respectively
Prompt payment discounts
From 1 April 2015, businesses will have to account for VAT on prompt payment discounts.
Currently, no VAT is charged on the discount, even if the customer pays the full amount.
Comment: Say business invoices £1,000 plus VAT with a 10% early settlement discount offered.
Under the current rules, the invoice would be for £1,180 (£1,000 plus VAT on the amount due after the discount).
Under the new rules, the invoice would be for £1,200 – £1,000 plus VAT on the whole amount at 20%.
