In This Chapter
Examining the nuts and bolts of VAT
Setting up for VAT
Getting the return right
Paying and reclaiming VAT
A lot of mystery and tales of horror surround the subject of value-added tax (VAT). Now that HM Revenue & Customs administers both tax and VAT, the average businessperson is facing an even more powerful organisation with a right to know even more about your business.
The rules governing which goods and services are subject to VAT and which items of VAT are reclaimable can be quite complex. This chapter can only scratch the surface and give a broad understanding. Contact both HM Revenue & Customs and your accountant/auditor at an early stage to find out whether all your sales are subject to VAT and how you can ensure that you’re only reclaiming allowable VAT. Remember the following – get it right from the beginning.