VAT can be a minefield if you don’t know much about it to begin with. But of course, if you have your own business and you are rapidly approaching the threshold for VAT, you will have no choice but to find out more.
This can be very overwhelming to begin with, and even quite nerve wracking for some people too. But the key to conquering this is to give yourself enough time to find out all you need to know. If you do your accounts monthly you will soon realise when you are getting closer to the VAT threshold, and you should have a few months grace in which to start looking into the subject. Don’t wait until you are almost there – give yourself more time.
So, where do you begin? The key is to find reliable sources of information that are updated regularly. That word ‘updated’ is the key here – you might come across a website that seems very useful, but if it hasn’t been updated in months you should steer clear of it.
The best site to use is of course the HM Revenue and Customs website, which you can find at http://www.hmrc.gov.uk/VAT/start/introduction.htm. This leads you to the introductory page, but there are plenty more pages that will give you even more information.
The sources you will require depend a lot on the nature of the information you want to look up. For example, if you just want to familiarise yourself with the basics to start with, the web page above should suffice.
Alternatively you might want to read some personal stories about how other business people have coped with introducing VAT. If this is the case the best bet is to find some business forums that give you the question and answer format. Not only can you read about how other people have got on with VAT, you can also sign up and ask any questions you might have in mind.
The one thing you need to remember here though is that unless someone on the forum is a VAT inspector and has professional knowledge, the answers you get will be purely from personal experience. That is not to say the information will be incorrect; it is more the case that people will be revealing their own personal situation. It may not be relevant in all cases.
Another good point of reference is the library. Lots of people rely on the internet now to get the information they need, but there is no reason why you cannot still use the library as well. Once again, look for good reference books that aren’t out of date. They should also preferably be written by someone with a professional knowledge of VAT in some respect.
The bottom line rule is to double check everything before acting on any piece of information. If you assume something that later turns out to be incorrect, it could cause big problems. The bottom line should always be HM Revenue and Customs.