Remember 1973? We welcomed Compo, Cleggy and friends as Last of the Summer Wine launched its pilot show, along with other first timers Some Mothers Do 'ave 'em, That's Life and The Wombles!
We swooned over David Cassidy or Donny Osmond whilst Marc Bolan and David Bowie pioneered glam rock, Roger Moore suavely stepped into James Bond's shoes in Live and Let Die and The Exorcist gave new meaning to the phrase 'head turning'.
George Foreman defeated Joe Frazier on his journey towards his ill fated ‘rumble in the jungle’ with Ali, Leeds United suffered a shock FA Cup defeat against Sunderland and Jackie Stewart was riding high in the Formula 1 Championship.
Oh, and VAT was introduced, into our vocabulary and our budgets, as part of the conditions of joining the EEC.
The rate of VAT was initially 10% - now there are three different rates; standard at 20%, reduced at 5% and Zero Rate, which perhaps not surprisingly comes in at 0%. The reduced rate is levied on utilities and zero rate on a wide variety of goods including food and drink. This zero rate status does not include ‘luxury’ food items which led, in 1991, to the great Jaffa Cake debate.
HMRC declared that Jaffa cakes were a chocolate covered snack (luxury) and McVities argued that a Jaffa Cake was a cake (zero rate). The tribunal ruled in favour of McVities; yet although the ‘luxury or cake’ question was resolved. ‘cake or biscuit’ still provokes many a heated discussion*.
Anyway, I digress. Most businesses need to pay the standard 20% rate of VAT. A business or individual with a turnover of £79,000 in the previous twelve months must register for VAT and charge their customers VAT.
Generally VAT submissions are made quarterly, online and there are penalties to be paid for late submissions and/or payment. There are however, various VAT schemes to assist which can include accounting for VAT on an annual basis, or registering for a ‘Flat Rate’ scheme which can be highly beneficial for certain businesses. Taking advantage of the various schemes is generally dependent upon the businesses annual turnover.
It’s hardly surprising therefore that many businesses live in fear of their VAT returns. The VAT regime is undoubtedly complex but with the help of a qualified professional accountant and tax adviser, you can choose the scheme that works for you and your business.
Happily here in Cambridge, we do have these experts at our disposal.
UHY WKH Partnership Chartered Accountants provide a full range of Financial Planning and Taxation Services, Business Development and Support to businesses and individuals in the Cambridge area.
Based in Great Shelford, Cambridge, local tax advisors, accountants and bookkeepers, Nicholas Cliffe & Co also offer accounting expertise from company secretarial services to tax and payroll services.
So whilst we may not feel like hanging up the bunting in celebration of this particular birthday, at least by contacting these local experts, taking the strain of VAT will be their gift to you! Find full details about our recommended accountants and tax advisors can be found on thebestof Cambridge's Business Services pages.
*cake goes dry and hard when stale, biscuits go soft – a Jaffa is therefore definitely cake!
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