By Maximilian Clarke
News emerged this morning that Business Secretary Vince Cable has been fined £500 for failing to pay up to £25,000 in VAT. And while his accountants assure that the gaffe was unintentional and has since been resolved, the issue has caused considerable embarrassment to the Liberal Democrat MP.
Diana Flier, Senior Compliance Analyst at Intuit UK, offers 5 pieces of advice to follow to avoid being landed with similar fines:
It’s important to make sure that staff in the business are aware of VAT deadlines and upcoming VAT changes and ensure that they understand the VAT company policy. Having a good level of understanding across the company will ensure the business doesn’t get caught out by the VAT man.
If you’re out on business a lot and don’t find yourself at the desk, put diary reminders on your mobile device so you know when important deadlines are coming up. This will provide a handy alert no matter where you are.
Keep a close eye on your turnover
The VAT threshold is applied on a 12 month rolling basis and so checking turnover against the VAT limit should be part of your regular monthly routine.
Get some decent financial software
Bookkeeping can be time-consuming if you rely on pen and paper records or have to wade through complex spreadsheets. With financial management software such as the newly launched QuickBooks 2012 it is easy to get an instant snapshot of your accounts and so easily check turnover against the VAT threshold at any point in the year.
If you are unsure where to start and want some further advice please get in touch with the HRMC directly — they have lots of information on the website and a number you can contact.
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