DID YOU KNOW YOU CAN CLAIM BACK VAT PAID ON GOODS AND SERVICES BOUGHT BEFORE REGISTRATION?
Generally a business needs to register for VAT when it's turnover reaches over £85,000 per annum. If you have just started making sales but you have incurred VAT on expenses before registration you can reclaim the VAT incurred on those costs in your first VAT return.
HOW FAR CAN WE GO BACK?
The time limit for backdating your VAT claim depending on if you have bought goods or services.
You can claim VAT on any goods you have purchased in the 4 years before registration. However, you must still have them for sale at the date registration.
You can claim VAT on services purchased 6 months before the date of registration.
PRE REGISTRATION SALES
Remember, if you are intending on claiming VAT on pre registration purchases you must ensure to account for any VAT on sales made during that time - otherwise HMRC will claim that you are being unjustly enriched.
KALA ATKINSON ARE A FIRM OF CHARTERED ACCOUNTANTS BASED IN EAST LONDON.
IF you need help registering for VAT, preparing your VAT returns or claiming back pre registration VAT we can help.
We have over 30 years experience in helping individuals and small businesses navigate their compliance whilst providing the financial tools in order to grow.
For more information on how we can help you and your small business contact us today.