Many small business owners pay cash out of their pocket for business expenses while out and about, put the receipt in their pocket, and never see it again. This is all fine and dandy until it comes time to make a record of that expense.
This is a problem for small businesses because in order to maintain good financial records, you must keep track of ALL your expenses. Furthermore, poor records equate to thousands of pounds in lost tax deductions.
One of the first taxes you are likely to come across when starting a small business is VAT, and it’s one of those things that can sometimes cause confusion or headaches if you don’t understand it properly.
While VAT is generally pretty straightforward, there are some more tricky areas, so in addition to the small business guide to VAT, please do take advice from your accountant.
Does VAT apply to me?
VAT (Value Added Tax) is a tax that is charged on [...]