After you have converted 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 hassle free accounting Vat Verification. These books of accounts have to record and display each vat transaction in greater detail, and may be of great help if you are put through a vat audit.
In the UK you’ll have to go for vat registration upon completing 70,000 sterling pounds of taxable sales in the previous one year of your business, even though you could do this before reaching that vat threshold limit. Once you have turned into a vat registered trader in the UK then you’ll have 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 will still have to be sure 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 assorted parties even if they were conducted abroad, etc.
These details should also 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 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 whilst all purchase invoices will need to be summarized in the purchase books. In addition, 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 and even your vat refunds and may choose 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 your books of accounts to confirm certain doubts lingering in their minds. They may cross check vat invoices with your sales books or request certain confirmations on specific vat transactions only to confirm if they were indeed genuine ones. If all your books of accounts related to vat are typically in order then that will create a favourable impression with those vat officers and also prevent any penalties from striking down your organization as well as your reputation.
In case you have any problems to understand what is vat then you definitely go looking for the expertise of a capable vat agent that can assist you to create and maintain all books of accounts related to vat in a clear and methodical manner click resources. You need to keep your books of accounts related to vat for a period of 6 years. Various vat schemes require different types of books and your vat agent would be able to assist you on the right format for your business based on your scheme and vat classifications of your services and goods.
Maintaining proper books of accounts will help you to conduct your business in a clear and seamless manner. If you too have adopted vat in the UK then you’ll definitely have to maintain complete vat books for trouble free accounting and auditing.