How To Pay VAT To HMRC
Many a time, I get asked about how to pay VAT to HMRC. Paying Value Added Tax (VAT) to HM Revenue and Customs (HMRC) can be a bit confusing at first, but fear not! In this article, I will break down the process step by step to make it easier for you to understand and comply with the regulations. Let's dive in! What is VAT and Why Do I Have to Pay It? What is VAT? Value Added Tax (VAT) is a consumption tax that is placed on most goods and services that are bought and sold in the UK. It is ultimately paid by the end consumer , but businesses in the supply chain are responsible for collecting and remitting the tax to HMRC. Why Do I Have to Pay VAT? As a business owner, you are required to charge VAT on your sales if your annual turnover exceeds the current VAT threshold (which is £90,000 as of April 2024). This tax is then paid to HMRC in order to help fund public services. Registering for VAT Do I Need to Register for VAT? If your business's taxable turnover exceeds the current V