Here we share our top 10 VAT tips especially for owner managed and family owned UK based businesses.
- Is your turnover £70,000 or less? Do you need to be registered for VAT, if you don’t need to compulsory register for VAT, would it be worthwhile de-registering? Let us help you calculate the cost implications.
- If you are not currently VAT registered you must monitor your turnover regularly (current VAT threshold is £70,000) – there are penalties for late VAT registration.
- Make sure you calculate your VAT liability correctly. Many business pay VAT on items they shouldn’t and don’t reclaim all the VAT that they are entitled to. Check out our free VAT advice.
- VAT legislation changes regularly, make sure you keep up-to date with legislation changes why not register for our free email alerts on VAT and other tax changes here http://www.hsjaccountants.co.uk/user/register.
- File all your VAT returns on time and make sure that VAT payments are made prior to deadlines, again there are financial penalties for not meeting VAT deadlines.
- If you are experiencing cash flow difficulties and will struggle to make your VAT payments on time, then contact HMRC and negotiate payment terms.
- Would the flat rate VAT scheme save you money? This scheme is for businesses with a turnover under £150,000. It saves administration and could be financially beneficial. Request our flat rate helpsheet by emailing firstname.lastname@example.org.
- Would you benefit from cash accounting for VAT purposes. If your taxable turnover is under £1,350,000 a year this method allows you to account for VAT on the basis of cash received and paid, rather than the invoice date or time of supply – all helping with cash flow!! Here are the rules on VAT cash accounting.
- Would you benefit from using the annual accounting method. If your turnover is under £1,350,000 then you only need to one VAT return per year.
- Should you be using a retail scheme? These schemes are for retailers where it’s not practical to issue invoices for a large number of supplies direct to the public.
VAT is a complex and specialist area of taxation and recently has seen three significant changes in just three years. If you are unsure about VAT and how to apply it within your business then why not take up book a free VAT review with us.