VRS7700 - Bespoke schemes: practical guidance: Reviewing bespoke scheme agreements
There is no “do nothing” option. “Doing nothing”, in this context implies acceptance of the current scheme and any change will only take effect from a future date.
It is best practice to begin a scheme review 6 months before the termination date so that a new agreement can be set to start when the old one runs out.
| If… | then… |
|---|---|
| you are satisfied with the current scheme | propose that it be continued, asking the business to detail any changes which might affect its ability to produce a fair and reasonable result. |
| you are not satisfied with the current scheme | propose the changes you would wish to see before you would be happy to agree to a continuation of the scheme. |
If resources are limited, send the business a letter stating:
- when your review will start; and
- when you anticipate a new agreement will be in place.
Make it clear that you accept the risk of receiving returns based on the old scheme for the duration of the review period.
If the risk of the scheme continuing pending a new agreement is unacceptable, invoke regulation 68 of the VAT Regulations 1995 in writing but advise the business that you are prepared to defer action pending discussion and agreement. You will need to underline that any new agreement will take effect from the date you notified the exercise of the power and that, in the meantime, returns will be processed without any implication that they are acceptable.
The Retail UoE would welcome information about any other examples of best practice, or details of successful negotiating positions.