what is cash accounting? Cash accounting enables you to account for VAT on the basis of payments received and made instead of on tax invoices issued and received. The VAT payable or repayable for each accounting period will be the difference between the total amount of VAT included in payments received from your customers and [...]

Under the normal rules of VAT, a supplier has to account for output tax even if the supply has not been paid for. VAT cannot be reclaimed by issuing a credit note for the unpaid amount. Please note: The use of cash accounting or certain retail schemes removes the problem of VAT on bad debts [...]

what is VAT? VAT is a tax chargeable on taxable supplies made in the UK by taxable persons. Credit is given for tax paid to other businesses and the net balance is payable or reclaimable – normally on a quarterly basis. taxable persons A taxable person is defined as one of the following carrying on [...]