Once you have converted into a vat registered trader in the United Kingdom or even in any other country that follows vat you then should maintain complete vat books for trouble free accounting. These books of accounts need to record and display each vat transaction in detail, and may be of great help if you are subjected to a vat audit.
In the UK you’ll have to go for vat registration upon completing 70,000 sterling pounds of taxable sales in the last one year of your business, although you could do so before reaching that vat threshold limit. After you have turned into a vat registered trader in the UK then you will need to obey all applicable vat rules framed by HM Revenue and Customs department or hmrc vat department. While there is no set means of maintaining books of accounts specifically for vat, you still have to be sure you store all details of vat paid and collected including invoice numbers, dates, vat rates, vat amounts, names and addresses of your respective dealings with various parties even if they were conducted in other countries, etc.
These records should also be summarized when you file regular vat returns on a yearly, quarterly or monthly basis, as decided by hmrc vat department. Your vat invoice too will specifically need to display your vat number, vat rate for each product or service, and also the http://vatcheck.com total vat amount collected against that sales invoice. All this data will also need to be mentioned in the sales books whilst all purchase invoices will have to be summarized in the purchase books. Moreover, maintaining bank and cash books is required 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 might decide to conduct a vat audit of your business. In such a case, vat officers might visit your business premises and would want to go over all of your books of accounts to verify certain doubts lingering in their minds. They might cross check vat invoices with all 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 pertaining 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 as well as your reputation.
In case you have any problems to understand what exactly is vat then you certainly go in for the services of a capable vat agent that can assist you to create and maintain all books of accounts associated with vat in a clear and methodical manner. You need to maintain books of accounts related to vat for a duration of 6 years. Various vat schemes require different kinds of books and your vat agent could guide you about the right format for your business depending on your scheme and vat classifications of your services and goods.
Maintaining proper books of accounts can help you to conduct your business in a clear and seamless manner. If you too have adopted vat in the UK then you will definitely have to maintain complete vat books for trouble free accounting and auditing.