Prompt payment delays
Managed EDI providers’ slow response to new prompt payment laws has cost clients time and money.
The way VAT is recorded against prompt payment discounts was amended in April to align Britain with the rest of Europe.
Its low key introduction caught many businesses unawares, causing users of managed electronic data interchange (EDI) services to request updates to their invoice templates simultaneously. Consequently, this took weeks to implement as the process was out of the suppliers’ hands.
Lobster_data offers an alternative to managed service providers, the perceived UK standard for processing EDI. Its software gives users control of data mapping, ensuring no loss of service when changes are required and no implementation costs.
We have been approached by businesses that were prevented from issuing invoices for three weeks, resulting in major cash flow issues, due to delays caused by the new prompt payment legislation. Under normal circumstances it can take UK managed service providers up to and sometimes more than a month to make amendments – at considerable expense to the client – which we think is unacceptable practise, but this additional burden exacerbated the problem.
Our users are not dictated to by a managed service provider and can make changes to EDI in house with no disruption to operational or accounting processes. For those who are new to Lobster_data, we have a support team on hand to answer queries, quickly and efficiently.
To find out more about the changes to the way VAT is recorded against prompt payment discounts, contact us on +44 (0) 114 399 1551 or visit the HMRC’s online guidance: https://www.gov.uk/government/publications/revenue-and-customs-brief-49-2014-vat-prompt-payment-discounts/revenue-and-customs-brief-49-2014-vat-prompt-payment-discounts