VAT
Value-Added Tax (VAT) is a tax on the sale of goods and services in the United Kingdom. It is a type of indirect tax, which means that it is collected by businesses and passed on to the government through their sales.
Most businesses that provide taxable goods or services in the UK must register for VAT if their taxable turnover (the value of their sales) exceeds a certain threshold. Currently, the threshold for registering for VAT is £85,000 per year.
Once a business is registered for VAT, it must charge VAT on most of the goods and services it sells. VAT is generally charged at a standard rate of 20%, although there are reduced rates for some goods and services, such as children's car seats and energy-saving materials.
As a business owner, it is your responsibility to keep accurate records of your sales and purchases, calculate the VAT due on your sales, and pay it to HM Revenue and Customs (HMRC). You will also need to complete VAT returns and submit them to HMRC by certain deadlines.
If you are unsure about your VAT obligations please schedule a free initial consultation with with us to find out how we can help.