V AT and PAYE can be essential parts of your business. If you expect your sales for the year to exceed £85,000 and if you plan to employ any staff then then this is the topping for you.
This topping includes:
Below is a breakdown of each individual component.
You must register for VAT if your taxable turnover is over £85,000. You cannot add VAT to any invoices until you are fully registered, but must pay it to HMRC as soon as you breech the registration threshold. Your VAT registration will include your VAT number, a submission date for your first VAT Return and payment, and the date you registered for VAT.
Note: You can voluntarily register for VAT if you are under the £85,000 threshold.
The moment you employ staff or use subcontractors you need to be registered with HMRC for PAYE (Pay as You Earn). This is the tax on employees’ income payments. It is a legal requirement to operate PAYE for any employee earning over £486 per month.
As you can see, these various tax registrations involve payments and submissions to HMRC. In order to deal with your accounts efficiently, it may be wise to get a professional to help you. That’s why we offer a free consultation with an accountant.