Customs and Excise have launched a pilot system for payment of VAT on line. Businesses of all sizes across the UK responded to an invitation to trial the new system which involves on line completion of the VAT return and electronic transfer of funds.The pilot system is available 24 hours a day, 7 days a week. Users log in to www.hmce.gov.uk/ecom/index.html Â and on completion of the input of data the system carries out arithmetic and validation checks and displays an explanation of any errors. An on line acknowledgement confirms acceptance of the data. Larger businesses pay their VAT bill by transferring funds through the Banks Automated Clearing System. Others use on line banking to make the transfer.
The benefits of the system to businesses are that they are given a seven day extension of paying VAT and they can be sure that the return does not contain any errors which could be costly to rectify at a later stage. The benefits to Customs are that they do not have to issue return forms or to process the completed forms, there are no cheques to handle and the burden of error correction is eliminated.
It is planned to make the on line system available to all businesses early in 2001.