Once you have converted into a vat registered trader in the UK or even in some other country that follows vat then you should maintain complete vat books for hassle free accounting Vatverification.com. These books of accounts have to record and display each vat transaction in detail, and can be of great help if you are put through a vat audit.
In the UK you’ll have to opt for vat registration upon completing 70,000 sterling pounds of taxable sales in the previous one year of your business, although you could do this before reaching that vat threshold limit. After you have become a vat registered trader in the UK then you’ll need to obey all applicable vat rules framed by HM Revenue and Customs department or hmrc vat department. While there is no set means of maintaining books of accounts specifically for vat, you still have to be sure that you store all details of vat paid and collected including invoice numbers, dates, vat rates, vat amounts, names and addresses of your respective dealings with assorted parties even though they were conducted abroad, etc.
These records 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 every service or product, and the total vat amount collected against that sales invoice. All of this data should also be mentioned in the sales books whilst all purchase invoices will need to be summarized in your purchase books. Moreover, 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 call at your business premises and would want to go over all your books of accounts to confirm certain doubts lingering in their minds. They might cross check vat invoices with 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 in order then that would create a favourable impression with those vat officers and also prevent any penalties from striking down your business as well as your reputation.
In case you have any problems in understanding what exactly is vat then you certainly go in for the services of a good vat agent that can assist you to create and keep all books of accounts related to vat in a clear and methodical manner click this link. You will need to keep your books of accounts connected with vat for a period of 6 years. Various vat schemes require different types of books and your vat agent could assist you about the right format for your business depending on your scheme and vat classifications of your goods and services.
Maintaining proper books of accounts will help you to conduct your small business in a clear and seamless manner. In case you too have adopted vat in the UK then you’ll definitely have to maintain complete vat books for hassle free accounting and auditing.