Reducing paperwork and making it easier to manage cashflow are essential in today’s economy. VAT accounting can be especially complex and time consuming, completing a VAT return every quarter and paying VAT due on a quarterly basis. Any refunds of VAT are also made quarterly under the standard VAT accounting rules. However, it is possible to apply for the Annual Accounting Scheme for VAT, which will make it much easier to manage cashflow and reduce levels of administration.

Complete and return form VAT600 AA to apply to join the scheme, if the VAT taxable turnover over the next 12 months is estimated to be less than £1.35 million. You can stay within the scheme only if your turnover stays below £1.6 million. Once you have been accepted onto the scheme by HM Revenue & Customs, you will make nine interim payments each year which are based on either the actual payments made in the previous year, or estimated payments for the coming year. Only one VAT return has to be submitted annually, which is when you will either make or receive a balancing payment.

There are a number of benefits to the Annual Accounting Scheme. Cashflow is easier to manage as you pay a fixed amount either monthly or quarterly. You have two months to complete just one VAT return annually. You can make extra payments as you wish. You can join the Annual Accounting Scheme using form VAT600 AA. If you want to join the Annual Accounting Scheme and the Flat Rate Scheme for VAT at the same time, complete form VAT600 AA/FRS.

The Accountancy Partnership

We are a national firm of accountants that specialise in small and medium sized businesses. We have been trading since 2006 and have more than 1,000 clients across many different industries and areas of the UK.

Our staff has a wealth of experience and qualifications from the major accountancy and tax associations such as ACCA, AAT, ICPA, IFA, and FTA.

Our clients receive many benefits including:

• Unlimited help and advice throughout the year — We offer our clients unlimited ongoing support for their business. We often find that new clients have lots of questions about running a business and about how the tax system works. We have heard every possible question many times before and therefore can offer new clients the very best advice.
• Free representation in the event of a HMRC investigation — If one of our clients is selected for a HMRC investigation then we will offer representation at no additional cost. We fight our client’s corner and ensure that our clients do not pay a penny more than necessary on the conclusion of the investigation.
• Dedicated Accountant — Our clients have their own dedicated accountant in which they can contact anytime. We feel this is important because it means our accountants can get to know their clients and build good relationships. All our accountants work from our main office and we never outsource work.
• Recommendations — With every piece of work we carry out for clients we look for recommendations that can be made. These recommendations can be anything from structuring the business in the most tax efficient way to recommending an insurance quote to reduce costs for clients.
• Free business guides — When a new client joins us we send them a free business guide. These guides outline in simple terms how the tax system works along with key dates and deadlines. Most clients find the guides to be extremely useful.
• Financial advice — We have a very reputable financial advisor who helps our clients to structure their finances in a way that best suits their needs. We always look out for circumstances where we think clients can benefit from financial advice and add it to their recommendations.

Please click here for a quotation for your business. Please also feel free to contact us if you have any questions or would like further information; 0800 0430 007, info@theaccountancy.co.uk.

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Disclaimer: The information contained in these articles is of a general nature and no assurance of accuracy can be given. It is not a substitute for specific professional advice in your own circumstances. No action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a consequence of the material can be accepted by the authors or the firm.