After you have converted into a vat registered trader in the United Kingdom or perhaps some other country that follows vat you then should maintain complete vat books for hassle free accounting. These books of accounts have to record and display each vat transaction in greater detail, and may be of great help if you’re 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 so before reaching that vat threshold limit. After you have turned into a vat registered trader in the UK then you’ll need to obey all applicable vat rules framed by HM Revenue and Customs department or hmrc vat department. While there is no set way of maintaining books of accounts especially for vat, you still www.vatverification.com have to be sure that you store all details of vat paid and collected including invoice numbers, dates, vat rates, vat amounts, names and addresses of your respective dealings with various parties even if they were conducted in other countries, etc.
These details will also need to be summarized whenever 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 each service or product, and also the total vat amount collected against that sales invoice. All of this data will also need to be mentioned in the sales books whilst all purchase invoices will have to be summarized in your purchase books. In addition, maintaining bank and cash books is required 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 and even your vat refunds and might decide 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 your books of accounts to verify 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 your books of accounts related to vat are typically 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 exactly is vat then you definitely should go looking for the expertise of a capable vat agent that can assist you to create and keep all books of accounts related to vat in a clear and methodical manner. You need to maintain books of accounts related to vat for a period of 6 years. Various vat schemes require different types of books and your vat agent would be able to assist you about the right format for your business based on your scheme and vat classifications of the goods and services.
Maintaining proper books of accounts can help you to conduct your small business in a clear and seamless manner. In case you too have adopted vat in the UK then you’ll definitely need to maintain complete vat books for trouble free accounting and auditing.