After you have turned into a vat registered trader in the United Kingdom or perhaps any other country that follows vat then you should maintain complete vat books for trouble free accounting. These books of accounts need to record and display each vat transaction in greater detail, and can be of great help if you’re 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 turned into a vat registered trader in the United Kingdom then you’ll need to obey all applicable vat rules framed by HM Revenue and Customs department or hmrc vat department. Although there is no set means of maintaining books of accounts especially for vat, you will still need to ensure that you store all details of vat paid and collected including invoice numbers, dates, vat rates, vat amounts, names and addresses of your dealings with various parties even though they were conducted in other countries, etc.
These records will also need to be summarized whenever 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 product or service, and the total vat amount collected against that sales invoice vatnumbers.com. All this data will also need to be mentioned in the sales books whilst all purchase invoices will have to be summarized in the purchase books. In addition, maintaining bank and cash books is required for vat registered traders.
Maintaining such vat books on an up-to-date basis is very important since vat officers at hmrc might compare your vat returns and even your vat refunds and may decide to conduct a vat audit of your business. When this happens, vat officers might visit your business premises and would 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 ask for certain confirmations on specific vat transactions simply to confirm if they were indeed genuine ones. If all of your books of accounts related to vat are in order then that will make a favourable impression with those vat officers as well as prevent any penalties from striking down your business as well as your reputation.
In case you have any problems in understanding what is vat then you certainly should go looking for the services of a capable vat agent that can help you to create and maintain all books of accounts related to vat in a clear and methodical manner check here. You will need to keep your books of accounts connected with vat for a period of 6 years. Various vat schemes require different kinds of books and your vat agent could guide you about the right format for your business based on your scheme and vat classifications of the goods and services.
Maintaining proper books of accounts can help you to conduct your business in a clear and seamless manner. If you too have adopted vat in the UK then you will definitely need to maintain complete vat books for trouble free accounting and auditing.