Maintain complete vat books for hassle free accounting

After you have converted into a vat registered trader in the UK or perhaps any other country that follows vat then you should maintain complete vat books for trouble 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 opt for vat registration upon completing 70,000 sterling pounds of taxable sales in the previous one year of your business, even though you can still do this before reaching that vat threshold limit. Once you have turned into a vat registered trader in the United Kingdom then you will need to obey all applicable vat rules framed by HM Revenue and Customs department or hmrc vat department. Although 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 these were conducted abroad, etc.

These details should also be summarized when you file regular vat returns on the 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 vatcheck total vat amount collected against that sales invoice. All of this data will also need to be mentioned in your sales books whilst all purchase invoices will have 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 might choose to conduct a vat audit of your business. When this happens, vat officers might call at your business premises and would want to look at all of your books of accounts to verify certain doubts lingering in their minds. They may cross check vat invoices with all your sales books or request certain confirmations on specific vat transactions only to confirm if they were indeed genuine ones. If all your books of accounts related to vat are typically in order then that would make a favourable impression with those vat officers as well as prevent any penalties from striking down your organization plus your reputation.

In case you have any problems to understand what is vat then you certainly should go in for the expertise of a good vat agent that can assist you to create and keep all books of accounts associated with vat in a clear and methodical manner. You need to keep your books of accounts related to vat for a period of 6 years. Various vat schemes require different kinds of books and your vat agent could assist you on the right format for your business based on your scheme and vat classifications of your goods and services.

Maintaining proper books of accounts can help you to conduct your small business in a clear and seamless manner. If you too now utilize vat in the UK then you'll definitely need to maintain complete vat books for hassle free accounting and auditing.