value added tax

VAT: An Introduction

VAT (Value Added Tax) is a tax on spending. Businesses must charge VAT if their sales are higher than a certain threshold when supplying goods or services to customers in the UK or the Isle of Man. It is also charged on goods and some services imported from outside the European Union, or coming into the UK from the other EU countries. This guide looks at: VAT: the basics Importing and exporting Special cases: secondhand goods, selling on the web and property Accounting for VAT VAT inspections There are no financial thresholds in this guide because they change regularly – contact HM Revenue & Customs (HMRC) – – for up-to-date information. VAT – the basics In essence, if you are registered for VAT, you add VAT to all your invoices where VAT is char... »

Small Businesses Divided on How to Deal with VAT Increase

Businesses are split about how they will deal with the increase in VAT due to come into effect on 4th January 2011. 6 in 10 businesses believe that the increase in VAT from 17.5% to 20% will affect their organisation’s cashflow to some extent. Nearly one tenth (9%) think cash flow will be affected to a significant degree. The Institute of Chartered Accounts in England and Wales (ICAEW) is urging companies to start preparing for the VAT rise before the Christmas rush. Businesses affected by the VAT increase are divided in their approach as to how to deal with it – over a third are likely to absorb the costs within the business (36%), under a third expect to increase their prices (30%) and the remaining third (34%) plan to do both (absorb some costs and increase some prices). Furthermore, th... »

FSB wants NI and VAT Freeze

FSB wants NI and VAT Freeze

Freezing National Insurance Contributions (NICs) and suspending VAT increases must be priorities for the next Government to help small firms out of the recession, the Federation of Small Businesses (FSB) has said. Launching its 2010 manifesto (149k PDF) to coincide with the run-up to the general election, the FSB has made several recommendations which it says will help small firms create jobs, get access to finance, innovate and set up new businesses. One of the key proposals is a shake-up of the current payroll tax regime, including a freeze on NICs and a rebate for firms taking on new staff over the next two years. “Two critical areas for small firms are job creation and broadening access to finance,” said an FSB spokesperson. “Small businesses hold the key to tackling ... »