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VAT (value added tax)

Value Added Tax (VAT)

TaxVAT is a tax that's charged on most goods and services that VAT-registered businesses provide in the UK. It's also charged on goods and some services that are imported from countries outside the European Union (EU), and brought into the UK from other EU countries.

VAT is charged when a VAT-registered business sells to either another business or to a non-business customer.

When VAT-registered businesses buy goods or services they can generally reclaim the VAT they've paid.  HMRC have published a useful guide to VAT.  Whitehill can help with every aspect of VAT - from registering you for VAT to developing and implementing VAT returns for you.  We can even submit the return and set up a payment for your business.

When do I need to register for VAT?

There is a statutory maximum turnover when you must register for VAT; in other words, once your turnover reaches a certain level you must register for VAT.  You may also want to register voluntarily for VAT if you have customers who can claim back VAT if you are registered, or have a lot of purchases from suppliers who are VAT registered.

What is the VAT return service?

If you are VAT registered then you will need to make a VAT return to HM Revenue & Customs (HMRC) and pay the VAT due.

We will use the information in your books and bank statements to calculate the amount of VAT you owe each quarter, and either make the return to HMRC for you or advise you on the amounts to declare to HMRC. We can also set up the payment required or let you have a statement of the amount payable by you to HMRC for VAT.

Special schemes

As well as the "standard" VAT scheme we can provide a VAT return service for businesses using a "special scheme".  We can help you to decide if one of these schemes is appropriate for your business, and register you for a HMRC Special Scheme if required.  Such "special schemes" include, for example;

  • Cash Accounting – you only need to pay VAT to HMRC when you are paid by your customers.
  • Flat Rate Scheme – applying a flat rate percentage to your sales and paying this amount to HMRC.
  • Annual Accounting – agreeing an annual liability, based on the previous year's figures, and paying this on an installment basis. At the end of each year a final return needs to be submitted and any balance due paid or claimed.
  • Travel Operators Margin Scheme (TOMS) - a specific scheme for businesses organising travel for clients.

How does the VAT return service work?

We will work from VAT receipts you collect from your suppliers and VAT invoices you send out from your business. From these we will maintain accurate VAT records within the books and, at the end of each VAT quarter, calculate the amount to be paid or claimed. We will then either complete your VAT return for you, or advise you of the numbers to fill in. Finally, we can either set up the payment for you or advise you on the amount due and the date payment must be made.

If you are in arrears we can also liaise direct with HMRC on your behalf to set up a payment plan.