Day 1

Sunflower Accounts Placement - Day 1

Nirvana - Smells like Tax Spirit.


Oh, hey, didn’t see you there. Not sure how I would see you there but that’s not the point, point is this: I’m Luke. That’s right, the exact same Luke that’s going to be writing a daily blog post on my time spent at Sunflower Accounts as an Intern. You’ll see what I get up to, gather some insight into the accounting world (hopefully) and perhaps even have a chuckle, so without further ado, let this rodeo commence.


So, it turns out that in the busy world of accounting, V.A.T isn’t just a general term made for the Only Fools and Horses theme song because although it’s a catchy, sing along lyric to a great show. It means an awful lot in business, who’d of thought it, not Del Trotter, that’s for sure. V.A.T stands for Value Added Tax which, in short, is the money that comes from your business to her majesty herself, but only if your business’s turn over is £85,000 or above. Just like any other term in business, it’s not as straight forward as you’d think or as you’d like at least. There are 2 main forms of V.A.T;


Output TaxV.A.T paid over to HMRC (Her Majesty’s Customs and Revenues) on sales.


Income Tax – V.A.T on purchases, however not all purchases attract V.A.T.


Interestingly, with the recent technological innovation that this beautiful pebble full of people called Earth has encountered, we have a whole new access to amazing and efficient technology and programmes such as XERO.


Why specify XERO you ask?


XERO is one of the most commonly used programmes for V.A.T, with a clean-cut, concise dashboard and display with multiple functions at your disposal to make your life easier, this isn’t an advertisement for XERO by any means, but from one blogger to a reader.




Lastly, the one exception to apply for V.A.T registration with HMRC is that if your turnover is below £85,000 but your business’s clients are registered for V.A.T, most accountants would advise your business to register for V.A.T.


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