VAT: Split your annual charge to make the taxman's visit a short one

Implementation of the Retail Distribution Review ("RDR") proposals is just under a year away and the debate on the VAT impact of the new rules shows no sign of cooling down. Senior policy advisers at HMRC, having initially been taken aback by all the fuss, have been meeting with trade bodies and tax advisers to work through the concerns, and have now released draft guidance, inviting comments by 31 December. The issue, in a nutshell, is that charges for arranging financial transactions are generally exempt, but financial or investment advice is subject to VAT. This is not changing, bu...