In case you have shifted over to vat or value added tax system then you need to maintain vat accounting standards for quick access to VAT records. Although most eu countries including the UK do not have rigid or set standards to keep vat records Http://www.vatcheck.com/vat/, you will still must make sure that relevant vat figures are easily easily obtainable in case the hmrc vat department wants them or pays a visit.
Over the past decade, a lot more countries including those within the EU have shifted their tax system on services and goods to vat. This method taxes goods and services each time there’s a transaction, thus raising revenues for governments while ensuring minimal tax leaks. If you are a trader in the UK then you may have turned into a vat registered trader once your taxable sales would have hit the vat threshold limit of ?70,000 in the last 12 months.
When you become part within the cycle of vat tax chain you will have to follow certain guidelines imposed by the HM Revenue and Customs department or hmrc department regarding vat accounting. You will be issued a unique vat number that will have to be mentioned in each vat invoice that you’ll be needed to generate with each sale. Additionally, you will ought to display vat rates of each products or services sold to your clients. Whenever you purchase goods or services from vat registered traders then you will also need to check if their invoices too stick to the same format as per hmrc vat.
In addition, the hmrc will even specify the frequency of filing vat returns to ensure that all vat that’s been collected by you, on your sales might be paid to the government. Your vat returns will have to provide a summary for vat paid on purchases and vat collected on taxable sales. In case you want to go in for a vat reclaim or vat refund there are separate vat forms that need to be filled up and delivered with documentary proof. The hmrc offers several vat online services including online filing of vat returns which should enable you to speedily complete all vat formalities consistently.
In the UK, you’ll need to maintain up-to-date vat accounting records such as banking accounts, profit and loss accounts, cash books, sales and purchase books, delivery notes, and other books of accounts relevant to your enterprise. If you deal in goods or services that attract reduced vat rates, zero vat rates, or are vat exempt then you will also need to clearly specify the classification of such goods or services within your records. There are many accounting schemes in vat like annual accounting scheme, cash accounting scheme, flat rate scheme, retail schemes, and second-hand goods scheme that will require specific techniques to maintain your required records.
Once you turn into a vat registered trader in the United Kingdom then you will have to follow vat regulations which have been specified by the hmrc vat department. These methods are not really hard and by maintaining proper vat accounting standards, it will become easy for you personally as well as the hmrc to have access to your vat records.