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PPD (Prompt Payment Discount)

Prompt Payment Discount (PPD) changes

HMRC are changing the rules regarding the treatment of VAT where PPD is offered (PPD is more commonly referred to as ‘settlement discount’).


From 1 April 2015, suppliers must account for VAT on the payment amount they actually receive from their customer; customers may then recover the VAT that is actually paid to the supplier. Where PPD is offered on or after 1 April, the supplier will now always show the full amount of VAT on the invoice.


More information can be found