VAT Basics
Small business and start ups have a lot of things to think about – VAT being just one. However, failure to consider VAT can lead to difficulties and penalties. So here are some pointers for new and/or growing bushiness:
- Plan ahead and know when to register for VAT
- Make contact with your advisers
- Monitor your turnover so that you know when you are approaching the VAT registration threshold
- Keep your records up-to-date and check accounting documents
- Speak to us if things go wrong or there’s something you don’t understand
- Deal with VAT enquiries or HMRC’s requests for information promptly
- Manage the VAT within your business cashflow
- Don’t worry if Customs make contact with you
- Right tax – right time
- If you are not happy with Customs’ behaviour or have received an unhelpful or incorrect ruling; challenge it.
The overall message is; talk to a professional at an early stage. Timing is very important for VAT and you usually only have one chance to get it right.
Finally, regarding the first point – it may benefit a business to VAT register before it is required to (a so-called voluntary registration). I shall look at that in more depth in my next article.