Once you have converted into a vat registered trader in the United Kingdom or even in some other country that follows vat then you should maintain complete vat books for hassle free accounting. These books of accounts need to record and display each vat transaction in greater detail, and can be of great help if you are put through a vat audit.
In the United Kingdom you will have to opt for vat registration upon completing 70,000 sterling pounds of taxable sales in the last twelve months of your business, even though you could do this before reaching that vat threshold limit. Once you have become a vat registered trader in the United Kingdom then you’ll need to obey all applicable vat rules framed by HM Revenue and Customs department or hmrc vat department. Although there is no set means of maintaining books of accounts especially for vat, you will still have to be sure that you store all specifics of vat paid and collected including invoice numbers, dates, vat rates, vat amounts, names and addresses of your respective dealings with assorted parties even though these were conducted abroad, etc.
These records will also need to be summarized when you file regular vat returns on the yearly, quarterly or monthly basis, as decided by hmrc vat department. Your vat invoice too will specifically need to display your vat number, vat rate for every service or product, and also the http://vatcheck.com total vat amount collected against that sales invoice. All of this data should also be mentioned in the sales books even as all purchase invoices will need to be summarized in the purchase books. In addition, maintaining bank and cash books is mandatory for vat registered traders.
Maintaining such vat books on an up-to-date basis is very important since vat officers at hmrc might compare your vat returns or even your vat refunds and may choose to conduct a vat audit of your business. When this happens, vat officers might visit your business premises and would want to go over all of your books of accounts to confirm certain doubts lingering in their minds. They might cross check vat invoices with your sales books or ask for certain confirmations on specific vat transactions simply to confirm if they were indeed genuine ones. If all of your books of accounts pertaining to vat are in order then that will make a favourable impression with those vat officers and also prevent any penalties from striking down your organization plus your reputation.
In case you have any problems in understanding what is vat then you should go in for the services of a good vat agent that can assist you to create and keep all books of accounts associated with vat in a clear and methodical manner. You will need to maintain books of accounts related to vat for a duration of 6 years. Various vat schemes require different kinds of books and your vat agent could assist you on the right format for your business based on your scheme and vat classifications of your goods and services.
Maintaining proper books of accounts will help you to conduct your business in a clear and seamless manner. If you too have adopted vat in the United Kingdom then you will definitely need to maintain complete vat books for hassle free accounting and auditing.