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<p>The Simplified Import VAT Accounting (SIVA) scheme is a trade facilitation measure
that reduces compliance costs for legitimate traders through the removal of the requirement
to provide a guarantee to secure import VAT paid through the duty deferment scheme.</p><p>
</p><p>The risk to the tax revenue by traders operating SIVA is potentially very large
as the period between the tax due being deferred and being collected by HMRC may result
in a failure to pay. The setting of the SIVA approval criteria has to strike a balance
between ensuring the trade receive the maximum benefit from the scheme, while at the
same time protecting the revenue.</p><p> </p><p>Businesses have to demonstrate on-going
compliance with the SIVA requirements. The SIVA team monitor this through internal
systems, including any outstanding debts or Time-to Pay agreements requested. When
they identify a business experiencing difficulties, they advise them of the potential
impact on their SIVA approval. Warning letters are issued by the team to businesses
who fail to comply and only if there is evidence of continued non-compliance is the
approval removed.</p><p>The current procedures provide an appropriate balance between
trade faciliation and protection of the revenue.</p><p> </p>
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