Vat or the Value Added Tax is the sales tax given against goods and services within the United Kingdom, EU and other global markets. The businesses with a turnover exceeding the VAT registration threshold 2020/2021 should complete the VAT Registration with the customs rules and regulations. Suppose you are having a business in the UK or carrying out global business online and failing to register within 30 days of reaching the threshold. In that case, your business has to pay the penalty. Once your business has got the Vat registration on the goods and services it delivers, it can charge VAT tax on the products sold to the customers and also the same on goods and services bought for the particular business from suppliers.
Hence, it is true that VAT registration is important, and it is a part of any business. If you are new and do not have any idea about Vat registration, you will know how it is beneficial to the companies in this article.
What is Voluntary Vat Registration?
Vat or the Value Added Tax can be done voluntarily. Though the Vat registration is needed when the business’s turnover crosses the taxable amount of £85,000 as per the Vat threshold 2020/21, it is possible to have a voluntary Vat registration. Several entities enjoy the benefits of doing so.
As the threshold 2020/2021, any business’s taxable turnover exceeds the limit given above, or if the amount is going to exceed within the next 30 days, the business should register for Vat. The date of Vat registration should be when you realize that your business has exceeded the limit not when it reaches the limit. If your business is having a taxable turnover of the particular limit for more than the last 12 months and it has not yet registered, it should do immediately. It should get Vat registered within the next 30 days, or the business will face threshold or penalties.
What are the specific cases to consider?
Apart from this, there are some special cases when the business should register no matter it has not reached the threshold. Such cases are only identified by the tax advisors or accountants who handle the business’s entire financial data. Whether you are running an online business or a brick and mortar business, you should stay updated on the Vat threshold every year as it keeps on changing. If you find that your business’s turnover has crossed the previous year’s threshold, you should report immediately and start registering. The experts who are working on this will surely help you out.
VAT Registration Helps In-
Avoiding Penalties: No business likes to face penalty or comes under an angry letter from the government. So, if you are done with Vat registration, you do not have to worry much about penalties.
Boosting Your Brand Value– almost all the large enterprises are Vat registered; hence, if you make a voluntary Vat registration, this indicates that you are also competing with large businesses.
Apart from this, if your business is VAT registered, you can get the Vat from the customers who buy products and services from you. Want to have a VAT registered, scroll online, and check out the rules and procedures.