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VAT Returns

Every business needs to keep a record of their accounting transactions. In addition the large majority of businesses need to prepare VAT returns on a month, quarterly or annual basis.

Generally, once your annual turnover exceeds the registration limit which is currently £82,000 you are required to register for VAT unless your trade is an exempt trade.

Registering for VAT

We can help you register as there are lots of rules surrounding VAT registration depending on the amount of turnover and or expected turnover the business has. If you get it wrong you will be faced with late registering penalties.

Specialise VAT Schemes

Once you have your VAT registration number, there are various difference VAT schemes and options you can elect for depending on your business requirements, from monthly returns if you are due VAT repayments, the 2nd hand goods scheme all the way to the flat rate scheme (if you are a small business) which simplifies your return.

The VAT Return

You need to include the following information on the VAT return:-

  • VAT on your sales invoices
  • VAT due on acquisitions from EU Countries
  • VAT on your purchases
  • Total sales excluding VAT (Including VAT if you use the Flat Rate scheme)
  • Total purchases excluding VAT
  • Total value of goods you sold to EU Countries
  • Total value of goods you purchased from EU Countries

Input VAT

It is important to recover all the input VAT (VAT on purchases) suffered, but remember the following:-

  • The expense needs to be incurred for business purposes and
  • There is a valid VAT invoice for the purchase

Cars and Motor expenses

One of the most common mistakes see on VAT returns is claiming VAT on the purchase of cars.

Input VAT is generally not recoverable on the purchase of a car unless it will be used exclusively in the business ie as a taxi. Where a car is leased rather than purchased you can receive 50% of the input VAT.

HMRC Authority

If we hold an HMRC authority from you we can act on behalf, speak to HMRC for you and also submit VAT return.

Finally, remember if you are a sole trader registered for VAT it is you who is registered for VAT not the business. So you need to charge VAT on your total income

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