Flat-rate VAT returns must now be filed using HMRC-approved bookkeeping software by businesses. Regardless of your expertise in the field, you must know how to fill out the nine boxes on the VAT return. These numbers were input correctly, and this proves it. Flat rate VAT returns require nine boxes to be filled out.
An HMRC-approved bookkeeping system must be used to submit your flat rate VAT return to HMRC on your behalf. Using cash accounting, you must supply statistics based on when you were paid or if you have assets worth more than £2,000 in value. Regardless of which method you pick, make sure your accounting software is set up correctly so that it knows which invoices to include on your flat rate VAT return.
Read on to find what exactly you need to do in each of the boxes.
STEP 1: The Information You Need
Make sure you have all of the necessary financial information before you begin. Here’s what you’ll require:
- For the period covered by the VAT return, your entire turnover (including VAT)
- For the period covered by the VAT return, your turnover (including VAT) in respect of supplies of commodities (not services) to the other EC Member States
- Remember to reduce your flat VAT rate by 1% in your first year as a VAT-registered business.
You’ll also need your HMRC Online Services login information.
STEP 2: Reporting the VAT to HMRC
Complete the following
- Fill in Box 1 with the VAT due to HMRC. Simply multiply your total turnover (including VAT) by your flat VAT rate.
- If you bought goods and services from the other EC Member States during this period, enter 0.00 in Box 2 unless you owe VAT (which you haven’t paid).
- In Box 4, type 0.00. In most cases, you are not allowed to recoup input tax on purchases under the Flat Rate Scheme.
- Boxes 3 and 5 are automatically calculated. The amount of VAT to be paid to HMRC for this time is shown in Box 5.
STEP 3: Reporting Your Turnover
- In Box 6, enter your total revenue, including VAT (in £ only).
- Enter 0 in Box 7.
- In Box 8, enter your total revenue from supplies of goods to other EC Member States (including VAT).
- In Box 9, enter 0.