If you have shifted over to vat or value added tax system then you need to maintain vat accounting standards for easy entry to VAT records. Although most eu countries like the UK do not have rigid or set standards to keep vat records, you still need to ensure that relevant vat figures can be accessible in case the hmrc vat department asks for them or pays you a visit.
Over the past decade, an increasing number of countries including those within the European Union have shifted their tax system on services and goods to vat. This method taxes goods and services every time there is a www.vatverification.com transaction, thus raising revenues for governments while ensuring minimal tax leaks. If you are a trader in the United Kingdom then you certainly may have converted into a vat registered trader once your taxable sales might have hit the vat threshold limit of ?70,000 in the previous 1 year.
When you become part in the cycle of vat tax chain you will need 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 need to be mentioned in each vat invoice that you will now be needed to generate with each sale. You will also have to display vat rates of every products or services sold to the clients. Whenever you purchase goods or services from vat registered traders you will also need to check if their invoices too stick to the same format as specified by hmrc vat.
In addition, the hmrc will even specify the regularity of filing vat returns to ensure that all vat that has been collected by you, on your sales can be paid to the government. Your vat returns will need 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 should be filled up and delivered with documentary proof. The hmrc offers several vat online services including online filing of vat returns and this should enable you to speedily complete all vat formalities consistently.
In the UK, you’ll have to maintain up-to-date vat accounting records such as bank accounts, profit and loss accounts, cash books, sales and purchase books, delivery notes, along with books of accounts relevant to your enterprise. If you deal in services or goods that attract reduced vat rates, zero vat rates, or are vat exempt then you will also need to clearly specify the classification of such services or goods in your records. There are many accounting schemes in vat such as annual accounting scheme, cash accounting scheme, flat rate scheme, retail schemes, and second-hand goods scheme that will need specific techniques to maintain the required records.
As soon as you turn into a vat registered trader in the UK then you will have to follow vat regulations that have been specified by the hmrc vat department. These techniques are certainly not really hard and by maintaining proper vat accounting standards, it will become very easy for you and the hmrc to have access to your vat records.