Links

How can I prepare and file VAT return?

How can I prepare and file VAT return?

Preparing VAT return is not an easy task. Most of the businesses have to prepare and file VAT returns every quarter. There are many schemes (other than Standard Rate Scheme) that HMRC allows you to adopt based on your business type and turnover. It is necessary to evaluate which is the best scheme for you as it can potentially reduce tax burden. You can use below table to ascertain best scheme for you;

VAT accounting scheme Threshold to join scheme Threshold to leave scheme
Flat Rate Scheme £150,000 or less More than £230,000
Cash Accounting Scheme £1.35 million or less More than £1.6 million
Annual Accounting Scheme £1.35 million or less More than £1.6 million
  As per Standard Rate scheme, VAT should be calculated on all the goods you sell / services that you provide except for transactions that are exempt from VAT. This will be your Output VAT.  You will also need to list out business purchases and expenses by separating the net amount and VAT amount that you have paid on them. This is your Input VAT. Amount of VAT payable/ Repayable is calculated by deducting Input VAT from Output VAT. It is worth noting that from April 2019 onwards, under Making Tax Digital initiative by HMRC, you are required to maintain all your records digitally and file your VAT returns online. We can provide you much needed support in keeping your records digital, compile VAT returns and submit them regularly.

Affinity Associates Limited