VAT

The domestic reverse charge for construction services means that the customer (rather than the supplier) accounts for VAT on certain construction services. It applies to VAT-registered businesses supplying or receiving specified construction services under CIS. The aim is to reduce VAT fraud in the construction sector. Businesses affected must ensure their invoicing and VAT accounting processes are updated accordingly.

We work with all major cloud bookkeeping platforms including Xero, QuickBooks, and FreeAgent. Cloud-based software allows real-time access to your financial data, automates bank feeds, and makes collaboration with your accountant much easier. We can help you choose the right platform for your business size and needs, and assist with setup and training.

HMRC offers several VAT schemes to simplify compliance for small businesses, including the Flat Rate Scheme (pay a fixed percentage of turnover), the Cash Accounting Scheme (account for VAT when payment is received), and the Annual Accounting Scheme (submit one return per year). The best scheme depends on your business type and cash flow.

Bookkeeping involves recording financial transactions accurately and consistently. Accounting builds on this data to prepare financial statements, analyse performance, advise on tax planning, and ensure compliance. Both are essential — bookkeeping provides the raw data, while accounting turns it into meaningful financial insight.

You must register for VAT when your taxable turnover exceeds the VAT registration threshold, currently £90,000 in any rolling 12-month period. You can also register voluntarily if your turnover is below this threshold, which may be beneficial if you have significant VAT-able expenses to reclaim.

A bookkeeper records your day-to-day financial transactions, including sales, purchases, receipts, and payments. They maintain accurate ledgers and reconcile bank accounts, ensuring your financial records are up to date. Good bookkeeping is the foundation of accurate accounts, tax returns, and management information — making it essential for any business.