VAT - Cash basis

System
System Posts: 100,534 🤖 Admin 🤖
edited 12:08PM in AAT member discussion
I have just started to act for a Ltd Co client. The previous accountants have been preparing VAT returns on accruals basis, whereas I feel it is obvious that the company would benefit from being on cash basis. How easy is it to transfer to cash basis? Do the company just have to write to Customs or is there a form that needs to be completed?

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT - Cash basis

    Easy peasy!

    So long as their tax affairs are up to date, they haven't had any 'run-ins' with HMRC and their turnover is under the limit (£600k?), they can just switch at the end of a VAT quarter. You don't need to notify HMRC.

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT - Cash basis

    660k :)

    Regards

    Dean
  • System
    System Posts: 100,534 🤖 Admin 🤖
    VAT - Cash basis
    paulb wrote:
    ..whereas I feel it is obvious that the company would benefit from being on cash basis..

    Remember to consider the non-cashflow issues like having to revert to accruals basis for the accounts. If the book-keeping is in good order and a suitable software package is used then that should not pose a problem.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT - Cash basis

    The bookkeeping will be done on Quickbooks and will be in excellent order as I will be doing it myself!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT - Cash basis

    Fabulous!!

    :lol::lol:

Categories

Privacy Policy