info@sandrasilk.co.uk
Call us on 01722 341820

What you may not know about VAT

2020
09
MAR

There are lots of things to remember about VAT when you are VAT registered.  This is an article I wrote about VAT a couple of years ago but the points I made are still relevant .

So, here are twelve things about VAT which you may not know.

 
1. VAT records must be kept for 6 years but if you submit returns under VAT MOSS they must be kept for 10 years.

2. You must keep copies of all the sales invoices you produce even if you later cancel them.

3. You only have to provide a simplified invoice for retail purchases of less than £250.  A simplified invoice does not need to have the customer's name and address and can show a VAT inclusive price.  It must have the VAT number.

4. VAT invoices must be issued within 30 days of the date of the supply of goods or services.

5. Payments in advance must be included on the VAT return when payment is received or within 30 days if a VAT invoice has not been produced.

6. Purchase invoices or receipts must be kept for every item you buy.  If you lose a receipt or it is no longer readable you should ask the supplier for a duplicate which should be marked as a duplicate.

7. You can only claim back VAT on purchases made for business purposes and which have an invoice addressed to your business.

8. You cannot claim back the VAT on a bad debt until the debt is older than six months.

 9.  You can claim back VAT on purchases made for your business up to 4 years prior to your VAT registration date as long as you still have the item.  

10. You can claim back VAT on purchases of services up to 6 months prior to your VAT registration date.

11. Business which have signed up to Making Tax Digital (MTD) either voluntarily or because they are over the VAT threshold of £85,000 per annum must maintain their accounting records digitally and submit VAT returns through accounting or bridging software.

12. Businesses must register for VAT if their turnover reaches £85,000 within a rolling 12 month period.  Businesses with a turnover of less than £85,000 may find it beneficial to register voluntarily.

Finally, don't forget if you register to pay your VAT by direct debit you will have an extra 3-5 days before the payment is taken from your bank.

 

Related Tags:  HMRC |  VAT | 
Copyright © 2020 Sandra Silk Bookkeeping and Business Services Ltd  |  All Rights Reserved
Unit 21 Portway Business Centre
Old Sarum, Salisbury
Salisbury
Wiltshire
SP4 6QX

e: info@sandrasilk.co.uk
t: 01722 341820