Sail smoothly towards compliance with a reliable online VAT registration service

There could be several reasons why your application is taking too long. Some of these reasons include;

• Errors in your application — A VAT application with errors or incomplete information could delay the process since HMRC may need to contact you to get the correct details.
• High volume of applications — During busy periods, such as the end of the tax year or holiday season, HMRC may be processing a high volume of VAT registration applications with constrained human resource capacity.
• Additional checks — Some applications may require additional checks to minimise the risk of fraud, non-compliance, or address discrepancies.

From the first date of VAT registration, you are able to claim the VAT on goods or services purchased for business use and charge the appropriate VAT on goods or services you supply to your customers as a separate item on the invoice.

Remember, add VAT as a tax on the value of a product or service at each stage of production or distribution. The table below shows the different VAT rates that apply in the UK.

Zero-rated items are taxable at 0%, while VAT-exempt items are not subject to tax at all. You can also claim back VAT on zero-rated purchases but cannot reclaim VAT on exempt VAT purchases.

Once your business is VAT registered, you must charge the appropriate VAT on sales (output VAT), and you can also reclaim VAT on purchases (input VAT). At the end of your VAT period (usually every three months), add up all the output VAT you’ve charged and subtract all the input VAT you’ve paid. Then either pay HMRC the difference or they pay it.

Yes. You may choose to register VAT online even if your turnover is below the £85,000 threshold to enjoy the pros of applying for VAT. However, you must still follow the rules and submit VAT returns according to the required timelines.

Pros - benefits of VAT registration

• Professionalism — Having a VAT number makes your business look more professional and established, which attracts potential clients and partners.
• Input tax recovery — As a VAT-registered business, you can reclaim your money back when you file returns with HMRC for expenses such as rent, equipment, and supplies, reducing overall costs.
• Input VAT pre-registration recovery — You do not pay VAT on business expenses because you can reclaim VAT for up to four years for goods your business still uses and for the previous six months on any services or goods before registration.
• International trade — VAT registration may be a requirement for trading with other countries, making it easier to expand your business internationally.
• Avoid penalties — Register and file VAT returns on time to avoid penalties and fines from HMRC.
• Cash flow — VAT registration schemes can help with cash flow management by allowing you to delay paying VAT until your customers have paid you.

• You’ll lack competitive advantage — Your consumers cannot reclaim VAT paid on goods or services purchased from you and therefore make savings putting your business at a disadvantage.
• Lack of capacity to reclaim — You cannot reclaim input tax paid on goods and services you’ve bought for your enterprise from VAT-registered businesses.

HMRC designed the Flat Rate VAT scheme to make working out what you owe in VAT easier. Instead of calculating the VAT you owe based on each sale and purchase, you only pay a percentage (fixed percentage) of your turnover. HMRC sets the flat rate percentage by trade industry and sector.

For example, let's say the annual gross turnover of your travel agency is £100,000. Under the standard VAT scheme, you must calculate the VAT on every sale (output) and purchase (input) and pay the difference to HMRC. But with the flat rate scheme, you will pay the industry fixed rate of 10.5% of your annual turnover. If the agency were in the standard scheme, it would charge its customers the standard rate of 20%, which would be £100,000. But with the flat rate scheme, the agency would pay £10, 500.

However, the Flat Rate Scheme may not benefit all sorts of businesses. Call us at 0207 689 7888, and we will help you determine the best scheme for your business.

There are seven types of VAT schemes in the UK as follows —

Instead of completing a VAT return once every quarter, the Annual Accounting Scheme allows you to submit your VAT return annually if your turnover is less than £1.35m to be eligible for this scheme.

At the start of each year, HMRC will ask you to estimate how much VAT you expect to pay, and you may opt to work with the figure you paid VAT on the previous year’s VAT amount.

The business pays HMRC VAT based on an estimated annual liability in instalments. At the end of the year, the government expects you to submit a VAT return to HMRC and pay balances due or receive a refund for overpayment.

Yes. Since we began trading, we have helped thousands of businesses register for VAT, and our team is ready to answer any questions or concerns you have during and after you’ve registered. Our VAT services include —-

• VAT registration online which includes working with you to prepare and submit the correct documentation;
• Working with your or your accountant for consultation and advice on the appropriate specialist scheme for your business;
• Specialist scheme registration (Flat rate scheme, Annual Accounting or VAT Cash Accounting Scheme etc.); and
• Guidance on how to create a vat online account.

The way business register for VAT changed on 1 August 2022 with the rollout of HMRC's new VAT Registration Service (VRS) for limited companies.

Once your business is VAT registered, HMRC expects you to maintain digital records and file tax returns using compatible software. Making Tax Digital for VAT is an HRMC initiative that seeks to streamline their VAT reporting process, reduce reporting errors, and make it easier for businesses to manage and fulfil their tax obligations. Find records that must be kept digitally in compliance with MTD for VAT-registered businesses.