Maintain complete vat books for hassle free accounting

Once you have turned into a vat registered trader in the United Kingdom or perhaps any other country that follows vat then you should maintain complete vat books for hassle free accounting. These books of accounts have to record and display each vat transaction in greater detail, and may be of great help if you’re put through a vat audit.

In the United Kingdom you’ll have to go for vat registration upon completing 70,000 sterling pounds of taxable sales in the previous twelve months of your business, even though you could do this before reaching that vat threshold limit. After you have turned into a vat registered trader in the United Kingdom then you’ll have to obey all applicable vat rules framed by HM Revenue and Customs department or hmrc vat department. While there is no set way of maintaining books of accounts especially for vat, you still vat verification have to be sure 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 various parties even though they were conducted in other countries, etc.

These details should also be summarized whenever you file regular vat returns on a yearly, quarterly or monthly basis, as decided by hmrc vat department. Your vat invoice too will specifically have to display your vat number, vat rate for each product or service, and the total vat amount collected against that sales invoice. All this data will also need to be mentioned in your sales books whilst all purchase invoices will need to be summarized in your 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 very important since vat officers at hmrc might compare your vat returns or 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 of your books of accounts to confirm certain doubts lingering in their minds. They might cross check vat invoices with your sales books or ask for certain confirmations on specific vat transactions simply 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 as well as prevent any penalties from striking down your business plus your reputation.

In case you have any problems to understand what exactly is vat then you go looking for the expertise 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. You will need to maintain books of accounts connected with vat for a duration of 6 years. Various vat schemes require different types of books and your vat agent would be able to guide you about the right format for your business depending on your scheme and vat classifications of your goods and services.

Maintaining proper books of accounts can help you to conduct your business in a clear and seamless manner. In case you too now utilize vat in the United Kingdom then you will definitely have to maintain complete vat books for trouble free accounting and auditing.