VAT services
VAT Services in Bracknell
It is compulsory for businesses with VAT taxable turnover of over £90,000 (current VAT registration threshold) to register for Value Added Tax (VAT). They can, however, choose to register even though their turnover is below £90,000. This is voluntary registration.
If businesses are no longer eligible to be VAT registered (e.g. stop making VAT taxable supplies), they must cancel their VAT registration within 30 days from when they stop being eligible. There may be a penalty for not cancelling the registration. If their VAT taxable turnover is below £88,000 (current VAT deregistration thereshold), they may ask HMRC to cancel their VAT registration. After the cancellation, they can no longer charge VAT on their goods or services and cannot reclaim VAT on their purchases.
A taxable supply is a supply made in the UK which is not exempt from VAT. This includes supplies at Standard rate (20%), Reduced rate (5%) and Zero rate (0%).
If you need or are looking for VAT services, look nowhere else but only at M&W Accountancy Services. We provide top quality and reliable VAT services to small and very small businesses, both start ups and established, in Bracknell and the surrounding areas. Our qualified accountants have expertise and experience in helping clients with their VAT needs. Our VAT services include: VAT registration, VAT returns, VAT registration cancellation, VAT schemes advice and general VAT advice.
VAT registration
Our VAT services start by helping non-VAT registered clinets register their business for VAT with HMRC if required. Some businesses must register for VAT (compulsory) while others may choose to register (voluntary). There are several advantages of being VAT registered, including:
a) lenders, customers and suppliers tend to believe that turnover of VAT registered business is above the VAT registration threshold
b) they will also assume that the VAT registered business is more established
c) some companies may prefer to do business with VAT registered organisations only because a non VAT registered business may be considered too small.
Compulsory registration
You must register your business for VAT (compulsory registration) if:
1. for the last 12 months, your total VAT taxable supplies was above £90,000
2. in the next 30 days, you expect your taxable supplies to be above £90,000
If all of the following applies, you must register for VAT regardless of your VAT taxable supply:
1. you are not based in the UK
2. your business is not based in the UK
3. your goods or services are supplied to the UK (or expected them to be supplied in the next 30 days)
Voluntary registration
You may choose to voluntarily register your business for VAT even though your taxable turnover is below the VAT registration threshold. There are advantages of voluntary registration. These include:
a) preventing your business from VAT late registration and hence a penalty. You may not notice that your taxable supplies have reached or exceeded the registration threshold and fail to notify HMRC. The voluntary registration helps prevent it happening
b) reclaiming VAT on most goods and services purchased from other businesses
There are also disadvantages for being voluntary registered, including:
1) higher prices than non-VAT registered businesses
2) cash flow problems if VAT bill is high
After registering (both voluntary and compulsory), HMRC will issue a VAT certificate to your business. Your VAT number, which is needed when your VAT return is filed and VAT payment is made, is shown on this certificate.
Penalty
VAT deregistration
Similarly, VAT deregistration can either be voluntary or compulsory. If your taxable turnover is below £88,000 and you do not want your business to remain VAT registered, then you may decide to cancel your VAT registration voluntarily. However, you must deregister your business from VAT if you:
a) cease trading
b) become part of a VAT group
c) sell your business
d) change the status of your business
f) cease to make taxable supplies
Again, as part of the VAT services, we can help you cancel your VAT registration with HMRC.
VAT returns
In addition to VAT registration, VAT returns must be filed to HMRC. We will also help you with your VAT returns submission.
VAT returns are normally filed quarterly but it can be changed to monthly or annually filing as well and you can do this in one of the two ways:
1. request the change online
2. fill in Form VAT484 and send it to HMRC
Currently a default surcharge penalty will occur if VAT return is filed late or the VAT late payment to HMRC is late even though the VAT return is filed on time. HMRC has introduced a new penalty for late filing and late payment for VAT accounting period starting on or after 1 January 2023 and will replace the VAT default surcharge.
Making Tax Digital (MTD) for VAT
HMRC launched Making Tax Digital for VAT in April 2019 for VAT registered businesses with taxable supply over £85,000. But from April 2022, the MTD for VAT has been extended to ALL VAT-registered businesses. This means they must:
1. keep their VAT records digitally. There will no longer be manual input of any VAT records because every transaction must be digitally linked to HMRC
2. file VAT returns using only commercial MTD-compatible software because HMRC has stopped providing their free VAT software
However, some VAT registered businesses may be exempt from the MTD rules if HMRC is satisfied with their conditions, which include disability and age. To ask for exemption, contact HMRC VAT.
VAT schemes
As part of the VAT services, we can provide advice with VAT schemes. The Standard VAT scheme will apply by default if no VAT scheme is chosen during registration. But it can be changed later if the other scheme suits your business better. VAT schemes include:
a) Standard VAT scheme: a VAT payment due to HMRC or a repayment from HMRC
b) Flat Rate Scheme (FRS): for turnover (excluding VAT) not exceeding £150,000
c) Cash accounting scheme: similar to the Standard VAT scheme. Your taxable supplies must not exceed £1.35 million
d) VAT retail scheme: no need to tell HMRC and can join at the start of any VAT period. There are three VAT retail schemes:
d.1) Point of Sale Scheme (VAT is recorded at the time of sale)
d.2) Apportionment Scheme (goods are bought for resale):
d.2.1) Apportionment Scheme 1: for retailers with annual sales (ex-VAT) of up to £1 million
d.2.2) Apportionment Scheme 2: for retailers with annual sales not exceeding £130 million
d.3) Direct Calculation Scheme (you make a small proportion of sale at one rate and a majority at another rate)
d.3.1) Direct Calculation Scheme 1: for retailers whose turnover does not exceed £1 million per annum
d.3.2) Direct Calculation Scheme 2: the turnover must not exceed £130 million
e) Annual accounting scheme:
e.1) file only one VAT return per year
e.2) make advance payments toward your VAT bill
e.3) either make a final payment or apply for a refund when filing the VAT return
Our VAT services
Our team at M&W Accountancy Services will provide high quality and very reliable VAT services to businesses in Bracknell. We are certain that you will be happy with our VAT services. Contact us today to see how we can be helpful to your VAT needs and to take advantage of our free initial advice!