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Small businesses ‘lacking awareness’ of VAT rules

A third of the UK’s smallest businesses are unaware of the rules governing VAT thresholds, recent research has revealed.

This lack of understanding means that around 780,000 businesses are at risk of being fined by HM Revenue & Customs (HMRC).

Meanwhile, according to the research, 27% of small businesses intentionally limit their trading in order to avoid reaching the VAT threshold.

Under the current rules, where businesses have a VAT taxable turnover of more than £82,000 in a 12-month period, or where there is a belief that turnover in a single 30 day period will exceed £82,000, they must register for VAT.

It is important to monitor turnover, as there is a penalty for late registration in addition to the tax payable.

We can assist with all of your VAT needs – please contact us for further information and assistance