29th Jan 2020 12:32
(Alliance News) - IntegraFin Holdings PLC is facing a GBP4.3 million value added tax bill following a decision by the UK tax department to remove one of the company's unit from a VAT group, the company reported late Tuesday.
A VAT group allows two or more corporate bodies to be treated as a single taxable entity.
The FTSE 250-listed company, which owns the Transact investment platform, said the UK tax department has terminated the VAT group membership of unit Integrated Application Development Pty Ltd with effect from July 16, 2016.
"The consequence of the exclusion of IAD from the UK VAT group is that the services provided from Australia would be subject to reverse-charge VAT," the London-based company said.
The tax department intends to recover VAT due since July 2016 which is around GBP4.3 million and going forward would charge an additional VAT of GBP1.4 million annually.
IntegraFin intends to challenge the tax department's decision.
"The content of the communication is not what we were expecting. The company is considering its response in consultation with its advisers," IntegraFin said.
IntegraFin shares in London were down 1.9% at 470.48 pence each on Wednesday afternoon.
By Tapan Panchal; [email protected]
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