MN11 VAT registration and returns


Why this is important

All businesses need to regularly check whether they need to register for VAT. You can also consider voluntarily registering for VAT. If you are registered you will need to complete a VAT return. This is a legal obligation for registered businesses and they can incur fines if they do not complete their VAT return in a timely manner.

Who might do this

You might need to do this if you are:

  • starting a business; or
  • preparing a VAT return.

What it involves

Complete VAT returns involves:

  • Deciding if your business should be registered for VAT;
  • preparing a VAT return; and
  • asking for professional help when you need it.

Other units that link closely with this

MN1 Decide on the financial needs of your business
MN3 Keep financial records for your business
MN4 Manage cash flow in your business
LG2 Keep up to date with current legislation affecting your business
OP3 Recruit people for your business
OP9 Set up a stakeholder pension scheme

What you need to do

  1. Check whether you need to be VAT registered, or whether registering voluntarily would benefit your business, and therefore need to complete a VAT return.
  2. Choose the scheme for accounting for VAT that best suites your business.
  3. Ensure your invoices include the right rate and amount of VAT and your VAT number.
  4. Identify what information you will need to fill in a VAT return.
  5. Set up appropriate recording systems for information so that it is available when you need it.
  6. Make sure that submissions are made in accordance with current legislation.
  7. Identify the products or services you have bought and sold and the VAT that applies to them.
  8. Complete and submit your VAT returns correctly, using data from appropriate recording systems.
  9. Make sure that guidance is sought from the VAT Office when required in a professional manner.
  10. Obtain independent, specialist help and advice when you need to.
  11. Allow enough time to fill in your VAT return and send it in within the statutory time limit.

What you need to know and understand

VAT Registration and Accounting

  1. Whether you need to register for VAT, whether voluntary registration would help your business and how to do it.
  2. The different schemes you can use for accounting for VAT.
  3. When your VAT return is due and how long it is likely to take you to fill in.

Records for VAT

  1. The information you need to fill in a VAT return (for example, accounts including details of invoices and sales).
  2. How to record accounting information (for example, computerised ledgers, manual control account and cash book, VAT receipts and invoices).
  3. How specialist software can help you keep your accounts.

Current Legislation

  1. Where to find out the current rules and regulations about VAT and filling in a VAT return (for example, HM Customs and Excise guides or website).
  2. The types of VAT that apply to the products or services you have bought and sold (for example, standard supplies, exempt supplies, zero-rated supplies, imports and exports).

Getting specialist advice

  1. How to follow guidance about filling in your VAT return and how to get more information.
  2. How to find a recognised and reliable specialist when required.
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