Once you have turned into a vat registered trader in the United Kingdom or even in any other country that follows vat then you should maintain complete vat books for trouble free accounting https://vatverification.com. These books of accounts need to record and display each vat transaction in detail, and may be of great help if you’re 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 last one year of your business, although you can still do so before reaching that vat threshold limit. Once you have turned into a vat registered trader in the United Kingdom 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 way of maintaining books of accounts especially for vat, you still need to ensure that 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 in other countries, 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 each service or product, 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 have to be summarized in your 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 extremely important since vat officers at hmrc might compare your vat returns or even your vat refunds and might decide to conduct a vat audit of your business. In such a case, vat officers might call at your business premises and would want to look at all your books of accounts to verify certain doubts lingering in their minds. They might 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 typically in order then that would make a favourable impression with those vat officers as well as prevent any penalties from striking down your organization plus your reputation.
If you have any problems in understanding what exactly is vat then you definitely should go looking for the services of a capable vat agent that can assist you to create and keep all books of accounts related to vat in a clear and methodical manner read this. You need to maintain 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 on the right format for your business depending on your scheme and vat classifications of the 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 have to maintain complete vat books for trouble free accounting and auditing.