Small Businesses: VAT
The question
To ask the Chancellor of the Exchequer, what (a) guidance, (b) funding, (c) accounting assistance and (d) other support her Department is providing to small businesses that become VAT-registered.
Answered by Dan Tomlinson
HMRC provides extensive guidance on GOV.UK to support VAT registered businesses including essentials that every business needs, up to more complex areas. Additional individual support is available from their helplines. HMRC has published an online VAT Registration Estimator for businesses approaching VAT registration. This helps them understand their basic obligations, work out what their liability may be should they need to register, and provides links to relevant guidance.
There are schemes available to small businesses to support their cash flow and simplify the requirements for accounting for VAT. This includes the annual accounting scheme and cash accounting scheme, available for businesses with a turnover up to £1.6m. The Flat Rate Scheme is also available for those with a turnover up to £230k. This simplifies the calculation of VAT liability by applying a sector-specific percentage to sales, rather than recording VAT on each transaction.
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