In recent years there has been a significant rise in fintech businesses; businesses who use technology solutions to help deliver financial service products. Experience has shown that these businesses don’t always appreciate how to calculate the amount of UK VAT they can reclaim on their operating costs. There is often a presumption that all UK VAT can be reclaimed from HMRC, but this is not the case when a business makes UK VAT-exempt sales, which many fintechs do. This leads to a risk of UK VAT errors and penalties.
Source Forbes
