What do I have to do once registered for VAT?

Once you’ve registered your business for VAT you must:

  • Charge VAT on the goods or services you sell (whether you sell to individual customers or to other businesses,
  • Include your VAT number on your invoices,
  • Pay VAT on the goods and services you buy for your businesses, and
  • Prepare and file a VAT return to HMRC each quarter to show how much VAT you have charged (known as output tax) and how much VAT you have paid (known as input tax).

If your output tax exceeds your input tax, you must pay the difference to HMRC. On the other hand, if your input tax exceeds your output tax, you can claim a refund on the difference.

There are three different rates of VAT that can be charged – standard rate, reduced rate and zero rate. Some goods and services are exempt from VAT. You need to make sure you are charging the right amount of VAT to avoid unexpected demands from HMRC for unpaid tax.

If you are VAT registered and your turnover falls below the threshold, it might be to your advantage to de-register for VAT.

Do you still have questions? Get in touch with our team to find out more about how they can help you.

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