Explanatory note

These Regulations which come into force on 1st April 1990 amend the Value Added Tax (Cash Accounting) Regulations 1987 (S.I. 1987/1427) (“the principal regulations”).

Regulation 3 amends regulation 4(1)of the principal regulations, which governs the conditions of eligibility for joining the cash accounting scheme. The amendment makes eligible persons who owe amounts of tax, surcharges, penalties or interest to the Commissioners. Provided that those amounts are not in excess of £1000 and an agreement has been reached with the Commissioners for settling that debt over a period of time such a person is now eligible to apply to join the scheme.

Regulation 4 amends regulation 6 of the principal regulations, which governs the conditions whereby a person may leave the cash accounting scheme. An authorised person is no longer required to remain in the scheme for a minimum of two years. Where he derives no benefit from membership or his accounting system cannot provide for compliance with the requirements of the scheme then provided he notifies the Commissioners he may leave the scheme at the end of the prescribed accounting period in which notification is received.