Once you have turned into a vat registered trader in the United Kingdom or perhaps some other country that follows vat then you should maintain complete vat books for hassle 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 put through a vat audit.
In the United Kingdom you will have to opt for vat registration upon completing 70,000 sterling pounds of taxable sales in the last 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 UK then you will have 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 still www.vatverification.com have to be sure that you store all specifics of vat paid and collected including invoice numbers, dates, vat rates, vat amounts, names and addresses of your dealings with various parties even though these were conducted in other countries, etc.
These records 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 each product or service, and the total vat amount collected against that sales invoice. All of this data will also need to be mentioned in your sales books even as all purchase invoices will need to be summarized in the purchase books. Moreover, 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 or even your vat refunds and may decide to conduct a vat audit of your business. In such a case, vat officers might visit your business premises and may want to look at all of your books of accounts to verify 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 only to confirm if they were indeed genuine ones. If all of your books of accounts related to vat are in order then that would create a favourable impression with those vat officers and also prevent any penalties from striking down your business as well as your reputation.
If you have any problems in understanding what is vat then you definitely go looking for the expertise of a capable vat agent that can help you to create and maintain all books of accounts associated with vat in a clear and methodical manner. 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 assist you about the right format for your business based on your scheme and vat classifications of your 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 United Kingdom then you will definitely need to maintain complete vat books for hassle free accounting and auditing.