VAT accountants services
for your small business
The qualified and experienced team prepare & submit your all-year-round VAT reporting and returns on your behalf.
The perfect mix of accounting software, tax experts and dedicated client manager could be just what you are looking for whilst staying compliant with HMRC’s Making Tax Digital rules.
What is VAT
Value Added Tax (VAT) is the tax you must pay when buying goods or services. If you are a business, you may be required to register for and collect VAT.
Businesses with a turnover of more than £85,000 (known as VAT registration threshold) must register to pay and add VAT on the products and services they buy and sell and pay this to HMRC when they file their quarterly return.
VAT in the UK is typically charged at:
- 20% on goods and services
- 5% is applied to some health, energy, heating, and protective products and services.
- 0% is applied to a range of products and services to do with health, building, publishing, and kids’ clothing.
Some services and sales of goods are outside the scope of VAT (like stamps, financial and property transactions). Instead, businesses charge VAT based on what they sell and how much money they make.
Your VAT registration number
The government gives your business a unique nine-digit number, prefixed with ‘GB’.
Company numbers are only given to VAT-registered businesses and can be found on your registration certificate, which also outlines when your company passed the registration threshold and when your first VAT return is due.
What is my VAT payment date?
If you need to check your VAT Return and payment deadlines, you can do this by signing into the Government Gateway and accessing your VAT online account.
Your VAT online account will provide you with the following:
- When your VAT Returns are due
- When the payment must clear HMRC’s account.
The submission and payment dates tend to be the same, and calculated one calendar month and seven days after the accounting period end.
Example: If your VAT period ends on March 31. Then, by May 7, you will have to pay the VAT owed. If paying by direct debit, payments are usually taken three days after the VAT return deadline.
Online VAT calculator
Visit HMRC’s website to determine when you must make your VAT payment for the current accounting period. You will be unable to use this calculator if you pay on account or use the annual accounting scheme. Use an approved accounting software provider to send your VAT return, and keep digital records.
How does VAT work?
Your company will need to submit VAT returns to HMRC on a monthly, quarterly, or annual basis. The return summarises the VAT collected on sales and the VAT incurred on expenditure during that period. If the collected figure exceeds the VAT incurred, you pay the difference to HMRC. If the VAT incurred is greater, HMRC will refund the difference.
Paying your bill
HMRC only accepts a direct debit or internet banking as a method of payment. They do not accept cheques. If you are having trouble making payments, contact them straight away.
Is your business ready for making tax digital for VAT?
Making Tax Digital (MTD) is changing how UK businesses do their taxes. It is now mandatory for VAT-registered businesses to keep records and submit their VAT returns digitally.
We use approved accounting software Xero, QuickBooks and FreeAgent, and we are fully accredited and MTD compliant.
We will help you file your VAT returns digitally and provide VAT advice and assistance whenever you need it.
Looking for a VAT service for your Business?
Speak to one of our specialist!
020-8577-0200
EU eCommerce VAT changes
Online businesses have seen massive sales growth over the last 18 months, and as a result, the EU has developed the ‘EU VAT Ecommerce Package’ to make VAT reporting easier for individual sellers and shift VAT responsibilities onto marketplaces.
A “One Stop Shop” (OSS) and “Import One Stop Shop” (IOSS) for B2C European sellers are part of the 2021 VAT eCommerce package, which aims to make it easier for sellers to figure out how much VAT they have to pay. As a result of these changes, the IOSS simplifies the collection, declaration, and payment of VAT for vendors who offer imported items to EU buyers
If you run an eCommerce business and need accounting support or more guidance on International VAT, click on the button below.
Our VAT registration service
Your dedicated accounting manager will handle all your VAT issues. They will assess your company’s tax efficiency and advise you to switch if necessary. They will also register you for the appropriate VAT scheme, manage the registration process, and inform you of new laws and regulations.
It is not essential to register for VAT straight away until you hit revenues of £85k. If your company is growing and is likely to hit this figure soon, get ahead of the game and register now, giving you complete peace of mind to run and grow your company!
Our VAT registration service
We love to plan ahead which means we will get everything ready for submission well before your VAT deadlines. Of course, there is a bit of paperwork involved, but hey, hand it over to us to deal with, that’s what we are here for!
We will also provide the relevant VAT returns reports and any amount that you need to pay.
We will also advise you on EU/EC sales based on your accounts and their position. Handling your finances gives us the knowledge to advise you on related matters so all your decisions help yourbusiness boom.
Fusion Services
We provide a comprehensive range of accounting and tax services to help launch your new venture.
Why choose us
Fully round VAT Assistance
Choosing the right VAT plan can make or break your business. Defining your products and services and your predicted earnings can all help you identify which scheme is best for your venture, lowering your VAT rate. Once you have picked an appropriate scheme, we will assist with the registration process, advise you on switching to a more tax-efficient arrangement and keep you up-to-date with VAT law changes.
Making Tax Digital (MTDfVAT) compliant
When you sign up for one of our price packages, you will have automatic access to our award-winning accounting software packages Xero, QuickBooks and FreeAgent and will oversee the filing of your digital VAT return. In addition, as members of the Institute of Chartered Accountants, we will provide you with expert advice and assistance whenever you require it, so your business is compliant with this new government initiative.
Dedicated VAT Accountant
Fusion Chartered Accountants, we offer qualified and experienced accountants who work tirelessly on your behalf, delivering VAT reporting to ensure you are compliant and flagging up any potential risks. We will minimise your liabilities and compliance issues, ensuring all aspects of VAT transactions are captured correctly, and all month-end processes are actioned on a timely basis.
Some of the VAT Schemes
we specialise in
| Category of Business | Current VAT Flat rate (%) |
|---|---|
| Accountancy or book keeping | 14.5 |
| Catering Services Including restaurants & takeaways | 12.5 |
| Entertainment or Joumalism | 12.5 |
| Financial Services | 13.5 |
| Hotel or accommodation | 10.5 |
| Legal Services | 14.5 |
| Publishing | 11 |
| Social Work | 11 |
| IT Consultants | 14.5 |
Flat Rate VAT Scheme
The VAT Flat Rate Scheme was set up to make sure businesses pay about the same amount of VAT without having to do as much paperwork as other VAT schemes.
The VAT amount paid to HMRC depends on the type of business you run and how much you charge your customers. You keep the difference between what you charge and what you pay HMRC, and you can’t get back the VAT you pay on your purchases, except for certain capital assets over £2,000.
A flat rate of 4% applies to stores that sell food, newspapers, tobacco or children’s clothes, and a rate of 14.5% applies to accountants, bookkeepers, computer/IT consultants, structural engineers, architects, and surveyors.
Standard VAT accounting
Standard VAT accounting means that financial activities are reported as they happen, no matter when the payment is made.
This has the potential to harm your business cash flow since you must pay VAT over to HMRC for services or goods sold, which you have not yet received the money for.
If, on the other hand, you have not paid for goods purchased, you can claim the VAT on the invoice received, resulting in a positive impact on your cash flow.
Cash VAT accounting
If your clients pay immediately but you buy on credit, the cash basis may be preferable because you would recuperate VAT sooner.
On the other hand, if your consumers take much longer to pay, but you pay your suppliers’ bills promptly, the invoice basis may be preferable.
Meet our VAT specialist
Jawaad Hussain
Client Accountant
I joined the Fusion team in 2015, and as an ACCA qualified Client Accountant, I work closely with SME’s providing tax, accounts, and business advice.
I am also certified with Xero, QuickBooks & FreeAgent. I particularly enjoy using technology and smart apps to support the business’s needs and growth.
I like playing football (BIG Liverpool fan – YNWA!), cycling and trekking. I also enjoy travelling and visiting new places. My favourites destination so far would have to be Istanbul.
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FAQ ‘s
Can anyone claim back VAT paid on goods and services?
No, only VAT registered businesses can claim back VAT paid on their purchases of business goods and services.
Can I voluntarily register for VAT even if my turnover is below the threshold?
Yes, you can voluntarily register for VAT even if your turnover is below the threshold. This might be beneficial if you want to reclaim VAT on your business expenses or if it makes your business appear larger to potential clients.
Who is exempt from paying VAT in UK?
The buyer does not need to pay, and the seller does not need to charge VAT on exempt goods and services like healthcare services, education and training, insurance, some financial services, membership subscriptions, postage stamps, etc. Businesses selling exempt goods and services are exempt from VAT registration.
Can I claim back VAT on business expenses?
Yes, you can claim back VAT on business-related expenses that have VAT included, provided they were incurred for the purpose of your VAT-registered business. You cannot claim VAT on personal expenses.
What's Making Tax Digital for VAT (MTD)?
Making Tax Digital is a UK government initiative that requires businesses to keep digital records and use compatible software for submitting VAT returns. Most VAT-registered businesses with a turnover above the VAT threshold are required to use MTD.
How do I account for VAT on sales to other EU countries after Brexit?
Post-Brexit, VAT rules for sales to the EU have changed. You may need to register for VAT in the EU country you’re selling to, or your customer might handle the VAT payment. Rules vary by country and business type.
What happens if I make a mistake on my VAT return?
If you make a mistake on your VAT return, you should correct it as soon as possible. Depending on the type of error, you might need to adjust your next return or use HMRC’s error correction procedure. It’s important to act promptly to avoid penalties. You can get help from expert accountants like Fusion Accountants to make sure your VAT returns are accurate and submitted on time.
Determining the Date of VAT Registration in Case of Compulsory Registration:
When your business’s taxable turnover exceeds the VAT registration threshold, you become liable to register for VAT. The effective date of your registration, known as the “effective date of registration” or “EDR,” is crucial as it determines when you start charging and accounting for VAT. The EDR is generally the first day of the second month after your taxable turnover exceeds the threshold.
Can I submit a VAT return without an accountant?
You can file your VAT return without an accountant. You will need MTD-compliant software to do so. However, it is advisable to consult qualified accountants like Fusion Accountants to avoid costly errors and penalties and the make the process stress free.