Issue 151

Efficiently managing your VAT liabilities to improve cashflow
VAT and indirect taxes can become cumbersome for businesses, with evolving rules and complexity. With a 20% rate, VAT significantly impacts cashflow, but there
are strategies to optimise your VAT position and boost cashflow.
1. VAT Registration: Any UK business exceeding £85,000 in annual turnover must register for VAT. Registering early offers benefits of being perceived as a
credible organisation, reclaiming VAT on expenses before payment, and access to schemes like Cash Accounting (for turnovers up to £1.35 million).
2. VAT Returns: Switching from quarterly to monthly VAT returns can expedite repayments from HMRC. Ensure you have the resources to handle more
frequent submissions.
3. VAT Accounting Schemes: HMRC offers various schemes to ease VAT payments for smaller businesses, including Standard VAT Accounting,
Cash Accounting, Annual Accounting, and the Flat Rate Scheme, which simplifies administration for small businesses.
4. Sector-Specific Opportunities: Businesses in sectors like hotels, construction, finance, and retail can benefit from VAT opportunities related
to their activities, including reclaims for cancellation charges, construction services, fund management fees, vouchers, and delivery charges.
5. Bad Debt Relief Claims: If payments remain unpaid for over 6 months, you can claim back VAT declared and paid on sales from HMRC,
subject to specific conditions. Note that VAT recovered on unpaid purchases is also repayable to HMRC.
6. Annual Adjustments: Businesses in sectors with VAT-exempt income or non-business activities must perform VAT partial
exemption and non-business calculations. Annual adjustments allow you to ‘average’ your recovery over 12 months, potentially
resulting in additional repayments or payments to HMRC and efficiency savings.
7.
Avoiding Late Payment Penalties: Introduce a direct debit arrangement with HMRC for timely VAT collection. Penalties are
charged based on VAT owed at days 15 and 30, so consider partial payments if full payment isn’t feasible.
8. OTS Reinstatement: Calls for the reinstatement of the Office of Tax Simplification (OTS) have been ongoing since its
abolition in September 2022. An independent body like OTS could simplify tax procedures and reduce the paperwork
burden businesses face.
In case of payment issues, our Banking & Finance specialists offer tax funding services to cover tax costs for up to 12
months, preserving cashflow, avoiding late payment charges, and ensuring peace of mind.
If you have questions or need assistance in managing VAT liabilities, contact our VAT team or your Azets advisor.
We’re here to help.
David Seymour
Senior Manager
Cardiff | 02920 549939
david.seymour@azets.co.uk
Bryony Lewis
Assistant Manager
Cardiff | 02920 549939
bryony.lewis@azets.co.uk
HELP I OSOD EICH EIDDO
HELP TO RENT OUT YOUR PROPERTY
Mae Gwasanaeth Gosod Sir Fynwy’n cynnig ffordd wahanol a chost eff eithiol o rentu eich eiddo.
Ein nod yw gwneud rheoli a good eich eiddo’n broses syml a rhwydd, a gweithio gyda chi ar reoli a hysbysebu eich eiddo yn ogystal â dod o hyd i denantiaid
wed’u fetio ar gyfer:
Cynlluniau Rhentu Preifat
Cynlluniau Lesio Preifat
Gyda chymorth ac arweiniad gan ein tim, cyfeillgar, profiadol a phroffesiynol.
Mae Gwasanaeth Gosod Sir Fynwy’n cynnig cynlluniau gosod tymor byr a hirdymor. At hyn, mae gennym lesoedd hirdymor, thwng pump ac ugain mlynedd, ar
gael drwy ‘Gynllun Lesio Cymru’ a ariennir gan Lywodraeth Cymru ac a reolir gan Wasanaeth Lesio Sir Fynwy. Mae grantiau ar gael i helpu dod â chartrefi gwag yn
ôl i gael eu defnyddio.
Os oes diddordeb gennych mewn good eich eiddo, neu os hoffech fwy o fanylion ynglyn @’r gwa-sanaeth a’r hyn yr ydym yn ei gynnig, cysylltwch @ Clare Hamer
Monmouthshire Letting Service offer an alternative and cost-effective way to rent your property.
We aim to make managing and letting your property a simple and easy process, working with you to manage and advertise your property as
well as finding you vetted tenants for.
Private Rental Schemes
Private Leasing Schemes
With the help and guidance from our friendly, experienced professional team.
Monmouthshire Letting Service offer short and long-term leasing schemes. Additionally, with ‘Leasing Scheme Wales’ funded by the Welsh
Government and managed by Monmouthshire Letting Service, we have long term leases available for between five and twenty years. Grants are
available to help bring empty homes back into use.
If you are interested in letting your accommodation or to find out more details about the service and what we offer, please contact Clare Hamer
Rhif ffôn/ Telephone: 01873 735426
E-bost/ Email: MLS@monmouthshire.gov.uk
Gwefan/ Website: www.monmouthshire.gov.uk/MLS
Gwefan/ Website: www.gov.wales/leasing-scheme-wales-guidance