Vat Returns
Most registered traders simply add VAT, where appropriate, to their sales and pay this over to HM Revenue & Customs after deducting any VAT input tax paid to suppliers. This is usually dealt with through a quarterly VAT return. However, since VAT began the system has become increasingly more complex and it is an unfortunate fact of business life that it cannot and should NEVER be ignored. It provides many pitfalls for the unwary and has financial penalties for even innocent errors.
There is now a facility to file your VAT return online. If you do this, you have an extra seven days before it is due, therefore, if your quarter ends on 31st May, you have until 7th July to submit, giving you more time to prepare and make a payment.
HM Revenue & Customs are clamping down on traders who should have been VAT registered but failed to do so and are trawling back through their records, demanding the VAT due which will also incur charges and interest depending on when the money should have originally been received by customs. You may be able to recoup the VAT due from your customers but some may not be willing to pay over the extra, therefore leaving you to foot the bill.
