Once you have turned into a vat registered trader in the United Kingdom or even in some 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 detail, and may be of great help if you are subjected to a vat audit.
In the UK you will have to opt for vat registration upon completing 70,000 sterling pounds of taxable sales in the previous twelve months of your business, even though you could do this before reaching that vat threshold limit. After you have become 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 way of maintaining books of accounts especially for vat, you still www.vatverification.com have to be sure you store all specifics 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 details should also be summarized when you file regular vat returns on a 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 also the total vat amount collected against that sales invoice. All of this data will also need to be mentioned in your sales books whilst all purchase invoices will need to be summarized in the 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 or even your vat refunds and may choose to conduct a vat audit of your business. When this happens, vat officers might call at your business premises and would want to go over all of your books of accounts to verify certain doubts lingering in their minds. They may cross check vat invoices with your sales books or request 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 would make a favourable impression with those vat officers as well as prevent any penalties from striking down your organization as well as your reputation.
If you have any problems in understanding what exactly is vat then you definitely go in for the expertise of a good vat agent that can help you to create and keep all books of accounts associated with vat in a clear and methodical manner. You need to keep your books of accounts related to vat for a period of 6 years. Various vat schemes require different kinds of books and your vat agent would be able to guide you about the right format for your business depending on your scheme and vat classifications of your services and goods.
Maintaining proper books of accounts can help you to conduct your business in a clear and seamless manner. If you too now utilize vat in the UK then you will definitely need to maintain complete vat books for trouble free accounting and auditing.