What is VAT
Simply, VAT is a tax imposed by the Government and collected by HM Customs and Excise. The main rate of VAT was until recently 17.5% and is currently 20%. The tax is added to the price that you charge your customers and has probably been added by those who supply you. I say probably because there are some types of goods and services that do not carry VAT and these will be mentioned a little later.
Do not fall Foul of the VAT man
The HM Customs and excise are not known for their sympathy and consideration. If you do not fill in your returns honestly you will be called to account. Just about all businesses will receive a visit from the VAT inspector from time to time and there is no way of knowing when until you get the phone call arranging the time for an inspection.
This artlce aims to help keep you on the right side of the VAT man.
If it is found that you have underpaid your VAT by an appreciable amount this must be paid back immediately. Failure to do so will result in your business being closed there and then and the locks changed. These guys do not mess about. Whilst the Inland revenue will try to give you some time to repay anything that you owe them the VAT man can be very impatient and he has the power,bylaw, to take what is rightfully his. So beware !
To Register or Not ?
If your business exceeds £70,00 of turnover eligible for VAT (or more) then the decision is made for you. It is a requirement that you must register if ---------------------------------------------------------------------------------------
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