Services / VAT Returns
How to get VAT Registered and what to consider. Should I be VAT registered? The quick answer is yes, if your business services or sales are taxable your turnover (sales) exceeds the statutory registration limit.
Can I register voluntarily for VAT?
Again the answer is yes you can – even if your turnover is below the statutory registration limit.
It can be advantageous for you to register voluntarily if:
- The nature of your trade means that your costs or purchases include VAT.
- Most of your customers are VAT registered and can claim back the VAT that you will need to add to your sales.
- Your supplies are mainly zero rated for VAT purposes.
If the answer to the above questions is no then it may be better to delay registration until you have to.
Our Advice regarding VAT Registration Issues:
- Never add VAT to your sales invoices UNLESS you are registered – to do so is a criminal offence!
- Avoid delay if you do need to register otherwise you will incur needless penalties and interest charges, as well as having to pay over VAT which you may not be able to recover from customers.
Special Schemes
Most registered traders simply add VAT, where appropriate, to their sales and pay this over to HMRC, less any VAT input tax paid to suppliers, on a quarterly basis.
For small businesses this can cause cash flow problems. You may have to pay over VAT added to sales invoices that is still not paid by your customers.
To help with this problem HMRC have created a number of “Special Schemes”.
Please visit our basics of tax section and select VAT for more details. |
