You may know nothing about VAT Accounting, but it doesn’t mean that you need to remain ignorant. If you’re a VAT taxpayer, the more you understand about any of it, the more benefit you as well as your business can are based on it. Listed below are five essential things you need to know about VAT Accounting.
1 – VAT Registration and De-Registration
How will you know whether you need to register or de-register for VAT? If your turnover is a lot more than �68,000 per year, you must sign up for VAT. If your turnover for the entire year is under �66,000, you’re allowed to de-register. Once you have registered for VAT, that’s when a VAT consultant will be useful to you. They can advise you on the most recent regulations and keep you as well as your business on the nice side of HM Revenue and Customs.
2 – VAT Schemes
Businesses that are registered for VAT have to account for tax when they invoice customers or when their own suppliers invoice them. HM Revenue and Customs includes a amount of VAT schemes that allow your organization to save time or only account for VAT when they are in fact paid. To work out which scheme bests suits you, seek the expert advice of an experienced VAT advisor.
3 – VAT Records
It really is your legal and mandatory obligation to keep accurate VAT records regarding any tax paid or received. You need to keep these records for a fixed period of time and there are penalties for poorly kept records. Keeping accurate VAT records helps you to avoid paying an excessive amount of tax. To find out more about keeping accurate VAT records, talk with a VAT accounting specialist.
4 – VAT Responsibilities
Are you aware what your VAT responsibilities are? If not, you could fall foul of the VAT penalty system. A VAT consultant will let you know your VAT responsibilities and help you to stick to them. You don’t need to be a VAT expert when you have a VAT adviser, they’ll keep you informed of all the position regarding Value Added Tax.
5 – VAT Penalties
As of 2009, a fresh VAT penalty system is set up. There are two scenarios under which a penalty will apply. The foremost is in the case of failure to notify about an under-assessment. This occurs whenever a VAT Return is not submitted and Customs need to estimate the assessment. If this assessment is lower than the actual figure it should be and the taxpayer will not inform HM Revenue and Customs, a penalty is liable.
Second, when someone submits a document that includes an error, this can also trigger a penalty. One when reasonable care had not been taken will undoubtedly be punished with 30% penalty. best VAT consultants in Dubai UAE which is deliberate but not concealed from HM Revenue & Customs will be punished with a 70% penalty fine. Finally, one which is deliberate and where concealment could be proved can lead to a 100% fine. By using a professional VAT consultant, it is possible to avoid making mistakes and paying the price for it.