Protecting Your Business from Emerging VAT Fraud

In recent months, a concerning trend has emerged involving fraudulent activity surrounding newly issued VAT registration numbers. Fraudsters are exploiting the time window between a VAT number being issued and the business linking it to a Government Gateway account. Once they obtain the VAT number, these individuals create their own Government Gateway account, change the bank details to accounts they control, and submit a fraudulent first VAT return.

The result? HMRC issues a repayment to the fraudster, who then disappears with the funds. Meanwhile, the legitimate business owner is left unable to file their genuine VAT return. Even worse, the VAT number is temporarily blocked during HMRC’s investigation, delaying all future VAT returns and disrupting the business’s cash flow and compliance status.

What You Can Do to Protect Your Business

Business owners and finance teams should take immediate action to reduce exposure to this type of fraud. Here are some key steps:

• Monitor New VAT Registrations Closely: Keep an eye on application progress and be ready to act as soon as your VAT number is issued.
• Link to a Government Gateway Account Immediately: As soon as you receive your VAT number, set up or link it to a Government Gateway account that you control. This is essential to prevent unauthorised access.
• Track VAT Deadlines: Make a note of all upcoming VAT return due dates and submit returns promptly. Timely submission narrows the opportunity for fraudulent activity.

How we can help

At Burgess Hodgson, we have developed a centralised process to handle submissions on your behalf – adding an extra layer of protection and ensuring compliance with HMRC requirements. However, we believe our role as accountants and tax advisors involves more than helping you stay compliant. Real growth starts with finding the right partner so for advice and support contact us at info@burgesshodgson.co.uk