VAT returns

You don’t usually need to register for VAT until your turnover reaches a certain limit in any 12 months, or you expect it to do so. This limit – the “VAT threshold” – is currently £82,000. You can register voluntarily even if your turnover is below the statutory registration threshold.

What is a VAT return?

A VAT return is a form to be filed with HMRC which shows how much VAT you are due to pay, if you are VAT registered. The VAT return amount is the amount of VAT reclaimable on purchases you have made.

What is a VAT return?

VAT registration can add credibility to your business and can also be advantageous if any of the following situations apply:

  • If the nature of your trade means that your costs or purchases include VAT
  • If most of your customers are VAT registered and can claim back the VAT that you have added to your sales.
  • If your supplies are mainly zero rated for VAT purposes.

However, if none of the above apply it may be better to delay the registration until you have to.

Avoid delay if you do need to register, otherwise you will incur penalties and interest charges, as well as having to account and pay over the VAT due from the time that you should have been registered. Unfortunately, you may not be able to recover the outstanding VAT from your customers. If you do find yourself in this situation please contact us for assistance. The longer you delay the higher the penalties will be.

HMRC have recognised that for small businesses having to pay over VAT added to sales invoices that have still not been paid by your customers can cause cash flow problems. They have now created a number of “Special Schemes” to alleviate some of the cash flow problems that a small business may face, especially when they are starting up. We can help to identify which of these schemes would be more beneficial to your business.

Here at Kidwells Whittakers we will complete your VAT returns in a timely manner depending on your business size. If you choose to use XERO soiftware then this will make logging VAT a lot easier and save you time, however, if you choose to leave it to us then this won't be a problem.

Further VAT information can be found at the following link: https://www.gov.uk/topic/business-tax/vat