For many large organisations financial processes are centralised in Shared Service Centres (SSCs). The efficiencies this brings include standardised operations, reduced costs and increased productivity.
There are however downsides too which should not be overlooked. The functions typically carried out by financial shared service centres are often ones involving key VAT processes that have a direct impact on the VAT returns of the businesses using the SSC’S services, most often Accounts Payable and expenses processing.
A lack of understanding of the VAT rules within the SSC can lead to VAT being recovered where it should not be, or “hidden” VAT costs being suffered unnecessarily.
The cost of making VAT errors can be substantial with VAT penalties now issued as standard unless it can be demonstrated that “reasonable care” was taken by the tax payer. HMRC also charge interest on VAT amounts due to them. HMRC can assess for errors going back 4 years so even relatively small quarterly VAT errors can add up to a significant amount over that time period.
It is therefore important that staff involved in processing VAT transactions or making VAT sensitive decisions within SSCs have sufficient VAT knowledge and training to be able to identify the common VAT risk areas and if necessary, ensure the required corrective action is taken before the VAT officer comes knocking.
Are you concerned about the level of VAT knowledge of your SSC staff? Are you confident that the staff making VAT decisions have had enough structured and in-depth VAT training enabling them to make VAT decisions correctly?
In our experience, many large organisations are concerned about the level of VAT knowledge in SSCs. This is certainly heightened when Senior Accounting Officer (SAO) regulations are considered.
We are working with many businesses to help identify potential areas where VAT knowledge may be deficient by using our free online ‘VAT Knowledge Assessment’ tool. The VAT assessment comprises questions based on the essential VAT information every staff member interacting with VAT should know in order for them to perform effectively and with reduced VAT risk.
Our VAT Knowledge Assessment is taken and submitted online and usually takes each staff member approximately 20 minutes to complete. Once staff members in your business undertake their free online VAT assessment, their responses will be reviewed by our team of experienced VAT consultants. VAT assessment submissions are analysed and compiled in to a comprehensive feedback Report that provides a snapshot of the current levels of VAT knowledge and pinpoints potential VAT risk areas.
Both the online VAT knowledge assessment and the feedback report are free – just fill in the form and receive an email link to the online VAT Knowledge Assessment. Once you have the link, you are able to distribute the link to colleagues interacting with VAT.