Please note that as of 13th January some dates have changed. VAT penalties will be introduced on 1st January 2023 instead of 1st April 2022. Points do not mean prizes with the new Penalty Regime… Paying your tax bill on time can be a struggle. The HM Revenue & Customs’ (HMRC’s) penalty regime exists, […]
Value-Added Tax (VAT) is a consumption tax that is levied on goods that have had value added at each stage of the supply chain. Businesses with turnover of £85,000 in a rolling 12 month period or more have to register for VAT. But even if your sales are below that level, you can register on […]
Keeping on top of the deadlines for your company filing and tax payments can be hard work. With so many elements to coordinate and keep track of, it’s easy for deadlines to occasionally slip through the cracks – but that can lead to fines, penalties and other issues. The key is to stay fully in […]
The VAT Flat Rate Scheme (FRS) is designed to simplify the calculation of VAT due for small businesses. VAT is calculated by applying a predetermined flat rate percentage to the business turnover. The flat rate is lower than the 20% standard rate of VAT but businesses can’t reclaim VAT on purchases except for certain capital […]
Cash accounting enables a business to account for and pay VAT on the basis of cash received and paid rather than on the basis of invoices issued and received. Advantages and Disadvantages of the Scheme The advantages of the scheme are as follows. Output tax is not due until the business receives payment of its […]
The flat rate scheme for small businesses was introduced to reduce the administrative burden imposed when operating VAT. Under the scheme a set percentage is applied to the turnover of the business as a one-off calculation instead of having to identify and record the VAT on each sale and purchase you make. Who can join? […]
It is quite possible within the VAT system for a business to be in the position of having to pay over VAT to HMRC while not having received payment from their customer. Bad debt relief allows businesses, that have made supplies on which they have accounted for and paid VAT but for which they have […]
VAT registered businesses act as unpaid tax collectors and are required to account both promptly and accurately for all the tax revenue collected by them. The VAT system is policed by HMRC with heavy penalties for breaches of the legislation. Ignorance is not an acceptable excuse for not complying with the rules. We highlight below […]
This factsheet focuses on VAT matters of relevance to the smaller business. A primary aim is to highlight common risk areas as a better understanding can contribute to a reduction of errors and help to minimise penalties. Another key ingredient in achieving that aim is good record keeping, otherwise there is an increased risk that […]
