Value Added Tax Services

Once you have registere for VAT (Value Added Tax) it is charged on most business transactions. A business will normally pay this on purchases and charge this on their sales. The difference between sales and purchase taxes is payable/reclaimable to HMRC.

The following UK Government webpage provides detail about the current process, including current rates and thresholds.

It is charged at different rates for various transactions, current rates are:

  • Standard rate – 20%
  • Reduced rate – 5%
  • Zero rate – 0%
  • Exempt

If your business turnover is above a certain amount (£85,000 for 2019) then you have to register for VAT and submit monthly, quarterly or yearly returns. Our Accountants Finance Equation can help you determine if your business needs to be registered or not and we can prepare returns and submit them for you as well as give you advice.

There are a number of schemes, for example, the flat rate scheme and the margin scheme. The flat rate scheme is designed to simplify your record keeping for sales and purchases. Allowing you to apply a fixed flat rate to your gross sales to determine the tax payable to HMRC. The margin scheme is suitable when you sell second-hand goods. You pay VAT on the difference between the purchase and selling price and we can help you determine if a particular scheme is to your benefit.

Flat rate VAT scheme changes

Making tax digital is now here for all VAT registered businesses. This means you can no longer use the government gateway portal to submit your returns. You now have to use HMRC compliant software to submit your returns.

Depending on how you trade, value added tax is more complex. There are different rules if you trade internationally, there may be reverse charge rules that apply to your business. if you trade internationally on platforms such as Amazon or eBay you may have to register in a country other than the UK. There are some special rules if you trade in land or property. Often advance planning is essential to make sure you don’t pay more than you have to.

How can we help you?

At the Finance Equation, we are passionate about helping our clients keep more of their money. Our accountants will provide you with leading edge cloud accounting solutions that will submit your returns effortlessly. If you are worried about your overall position our accountants can help you navigate through the process. Contact us for a free consultation on 020 3086 7472.