Value Added Tax Act 1994 section 27

Increase or decrease in consideration for a supply

Section 27 deals with what happens when the price of a UK supply changes after a special scheme VAT return has already been submitted, and the steps the supplier must take to correct the VAT position.

• When the consideration for a UK supply increases or decreases after a special scheme return has been filed, the return must be corrected in the period the change is reflected in the business accounts
• If the amendment window under Article 61 of the Implementing Regulation has expired, the supplier must instead notify HMRC of the adjustment needed
• An increase in consideration requires payment of the additional VAT to the relevant tax authority (or to HMRC if the amendment window has passed), while a decrease operates as a repayment claim for overpaid VAT
• HMRC may make regulations specifying the time limits, form, and manner for submitting notifications, claims, and payments where the amendment window has expired