VAT Registration & Returns
If your business or company reaches the annual turnover threshold of £85,000, you are legally required to register with HMRC for Value Added Tax (VAT). VAT returns can be filed monthly, quarterly or annually depending on circumstances. This period of time is known as your accounting period. There are three VAT schemes available; Flat Rate Scheme, Cash Accounting Scheme and Annual Accounting Scheme. The choice of VAT scheme would depend on personal preference and business nature.
A VAT Return essentially calculates the amount of VAT you owe to HMRC or the amount of VAT you can reclaim from HMRC. The calculation of your liability formulates from a business’ records. These records include:
- Sales invoices
- Purchase invoices
Keeping electronic copies of these records will be compulsory from 1 April 2019. HMRC have introduced Making Tax Digital (MTD). This service is compulsory to all VAT registered businesses with a taxable turnover above the VAT threshold. They have the responsibility to keep digital records and electronically send this information through API compatible software. Hampson and Co have the ability to help your business from the record keeping stage to the submission stage through our API software.