VAT If your business breaches the ÂŁ85,000 turnover threshold, or you choose to register voluntarily, your business will be required to file VAT returns. VAT is usually payable quarterly; however can be setup monthly (if you are regularly in a refund position) or annually. Quarterly VAT returns are due for filing one month and seven days after the quarter. For example, a company operating on calendar quarters for VAT would be required to file and pay VAT to HMRC by 7 May, 7 August, 7 November and 7 February. Businesses with turnover below the invoice accounting threshold of ÂŁ1.35 million should be eligible to operate cash accounting for VAT. This means that your business only pays VAT on sales invoices/reclaims VAT on purchases when the invoice has been paid. This can aid cashflow, as the business only falls liable to VAT once the money has been received from its customers. As your business grows, the switch from cash to invoice accounting can have an impact on cashflow, so is an area to be aware of. JULIAN MILLINCHAMP Indirect Tax Director 01242 237661 julian.millinchamp@hazlewoods.co.uk
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