Value added tax or VAT is tax which is added to sale of goods or services (transactions). A business that has registered for VAT would have received a registration form from HMRC. On this will have details such as VAT registration number and the date of their tax period, which in most cases are quarterly.
VAT can get a bit confusing so here is a quick explanation:
A business will pay VAT on it’s purchases this is called input tax and it will charge VAT on it’s sales this is called output tax.
If your business pays more output tax then input tax you will have to pay the difference to HMRC. On the flip side if your business pays more input tax then output tax it will be able to reclaim the difference. In order to do this you will have to complete and submit a VAT return to HMRC.
If you do not complete your VAT return on time you will be charged a penalty this money could be used to put back into your business. Having your accounts up to date will reduce added stress when a return is due why wait until the last minute to get everything up together?
We are here to help and will be able to deal with your VAT returns for you.