Value added tax (VAT) applies more or less to all goods and services that are bought and sold for consumption. Businesses must register for VAT if their turnover is over a certain threshold.
There are different VAT schemes for small businesses such as:
Cash Accounting Scheme
Under the Cash Accounting Scheme, you pay VAT on your sales when your customer pays you and you reclaim VAT on your purchases when you have paid your suppliers. Businesses with a VAT taxable turnover of £1.35 million or less can join this scheme.
VAT Annual Accounting Scheme
Normally, VAT registered businesses submit their VAT returns and payments quarterly. Under the Annual Accounting Scheme, you submit one VAT Return for the year and you pay for VAT based on your last return. Businesses with a VAT taxable turnover of £1.35 million or less can join this scheme.
Flat Rate VAT Scheme
Normally, the amount of VAT a business pays or claims back from HM Revenue and Customs (HMRC) is the difference between the VAT charged to customers and VAT paid on their purchases. Under the Flat Rate Scheme, you pay a fixed rate of VAT to HMRC. The fixed rate of VAT will depend on your business type.
At Martax, we can help you:
- Register your company for the VAT with HMRC
- Advise on which VAT Scheme is relevant for your businesses
- Calculation of the VAT due or payable to your business
- Preparation of the VAT returns and filing of the same with approved HMRC software
We can provide you with a fixed monthly fee quotation for your VAT compliance needs.