With effect from VAT periods commencing on or after 1 April 2010 existing businesses with an annual turnover of £100,000 or more will have to file their VAT Returns online and pay their VAT by electronic payment. The same rules also apply to all new businesses (regardless of turnover) that register for VAT on or after 1 April 2010. Other businesses will need to follow the compulsory online filing at a later date which has yet to be confirmed.
Filing VAT returns online has several benefits for small businesses. One of the main advantages is that the process is simple and very user friendly, with the added advantage that you no longer need to file paper returns by post. Once you have submitted your return online, you receive an on-screen acknowledgement and a unique reference number, so that you know that HMRC have received your return successfully. Other advantages of the online system include email alerts to keep you up to date on developments that affect your business and the ability to amend your VAT registration details online.
If you pay your VAT by direct debit, you will also receive an extended filing date of an additional 7 calendar days from the standard due date. It will be a further three working days before they collect payment from your bank account. This can create a substantial cash flow benefit to your business.
To enrol for VAT online you need the following 5 pieces of information about your business to hand:
• VAT Registration Number
• The postcode of your principal place of business
• Your effective date of registration for VAT
• The final month of the last VAT return you submitted
• The Box 5 figure from the last VAT Return you submitted
You can find further information at http://www.hmrc.gov.uk/vat/start/register/signup-online.htm or alternatively please get in touch with The Accountancy Office and we'll be delighted to help you, completely free of charge. You can also sign up for our free informative start-up business guide and regular tax tips through our website www.accountancyoffice.co.uk.
Sarah Sallis
Director
The Accountancy Office Limited
Chartered Management Accountants
e-mail: hello@accountancyoffice.co.uk
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