VAT

Value Added Tax (VAT) is one of the areas where small businesses find it difficult to comply with the HMRC regulations.

Every business in the UK must register for VAT if "taxable supplies" over the past 12 months has exceeded the VAT registration threshold. "Taxable Supplies" are any goods and services that are subject to VAT at any rate, including zero rates.

The threshold is currently £70,000 (i.e. 1st April 2010). In other words, if the turnover of the business over last 12 month (preceding to 1st April 2010) exceeded £70,000 that business must register for VAT irrespective of whether good are taxable or zero rated. VAT applies to the company's turnover rather than purchases. The VAT will change to 20% from 1st January 2011.

We recommend our customers to register for VAT as it gives more credibility to the business. Also, a business can claim the VAT on purchases made for businesses. If businesses are not VAT registered, it is important to keep an eye on the turnover to avoid penalties from HMRC. Failure to comply within 30 days of the exceeding the turnover results in penalty. So it is advisable to voluntarily register for VAT.

Why Namaste Consulting?

• We are most competitive
• We are flexible in our fees and time with 24/7 service at short notice
• We help you with VAT registration formalities
• We set up your accounts to reflect VAT purchases and sales
• We file your returns quarterly and make ourselves available for any visit form HMRC’s VAT inspectors
• We also train your staff on various aspects of VAT accounting i.e. Standard rate, zero rate, Exempted VAT, partial exemption, EU and International transaction.

Further help is available on HMRC website:

http://www.hmrc.gov.uk/vat/start/register/index.htm

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