After you have converted into a vat registered trader in the United Kingdom or even in any other country that follows vat you then should maintain complete vat books for hassle free accounting Vatverification.com. These books of accounts need to record and display each vat transaction in greater detail, and may be of great help if you are subjected to a vat audit.
In the United Kingdom you will have to go for vat registration upon completing 70,000 sterling pounds of taxable sales in the previous one year of your business, although you can still do this before reaching that vat threshold limit. After you have turned into a vat registered trader in the UK then you will 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 specifically for vat, you still need to ensure you store all specifics of vat paid and collected including invoice numbers, dates, vat rates, vat amounts, names and addresses of your dealings with various parties even though these were conducted abroad, etc.
These details should also be summarized when 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 product or service, and the total vat amount collected against that sales invoice. All of this data will also need to be mentioned in your sales books even as all purchase invoices will need to be summarized in your purchase books. In addition, maintaining bank and cash books is mandatory for vat registered traders.
Maintaining such vat books on an up-to-date basis is extremely 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. In such a case, vat officers might visit your business premises and may want to look at all of your books of accounts to confirm certain doubts lingering in their minds. They may cross check vat invoices with all your sales books or request certain confirmations on specific vat transactions only to confirm if they were indeed genuine ones. If all of your books of accounts related to vat are typically in order then that will create a favourable impression with those vat officers as well as prevent any penalties from striking down your business plus your reputation.
In case you have any problems in understanding what exactly is vat then you certainly go in for the expertise of a capable vat agent that can help you to create and maintain all books of accounts associated with vat in a clear and methodical manner check here. You need to keep your 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 on the right format for your business based on your scheme and vat classifications of the goods and services.
Maintaining proper books of accounts will help you to conduct your business in a clear and seamless manner. In case you too now utilize vat in the United Kingdom then you’ll definitely have to maintain complete vat books for trouble free accounting and auditing.