Boost Efficiency in Accounting with Outsourced VAT Return UK Services

Among the multiple important responsibilities handled by UK accounting practices is handling VAT for their clients through VAT accounting. Judging by the name, beginners may wonder if it is a complex responsibility, but that’s not the case. Still, accounting practices cannot discount the importance of outsourced VAT accounting services, especially when dealing with complex cases. Having professional UK-based outsourced VAT accounting services by your side is like shielding your practice from all the obstacles that can derail your VAT services for your clients. With them handling the complex tasks, you will be spared with time and resources that can be invested in practice expansion and service upgradation.

What is a VAT Return in the UK?

Before we understand outsourced VAT return UK services, let’s get a brief overview of VAT. VAT is a tax levied on goods and services at each level of production or distribution. In the UK, your clients collect VAT on behalf of the government and fill out a form containing the details of the VAT collected; this form is called a VAT return. VAT returns must be completed four times a year, and no business or service is exempt from UK VAT except for a select few.

If you run an accounting practice, you must understand the importance of VAT for your clients. With proper VAT accounting from your side, they can maintain full compliance with HMRC, thus avoiding penalties and maintaining the good books of tax authorities. However, handling UK VAT in-house is easier said than done because of increased complexities and frequent regulatory changes, making it difficult to keep tabs on it.

To address these challenges, many accounting practices are choosing to use the outsourced VAT services of professional accounting service providers. But first, let’s understand the challenges faced by accounting practices while doing in-house VAT.

Common Challenges While Conducting VAT Accounting In-House

In the past handling of VAT for your clients was the turf of accounting practices. Since accounting practices like yours have a good command over UK VAT, multiple businesses have started handing over this responsibility to practices to save time and resources.

However, this has given rise to a situation, i.e., an increased workload of complex VAT tasks on your teams, and that’s not all. There are other sets of challenges such as:

Increasingly Complex VAT Regulations

Every accounting practice and business is aware of the web of UK VAT regulations. Apart from being complex, these regulations are ever-changing, making it essential for you to keep a constant eye on the updates. Due to the complex nature of the VAT regulations, the process has become increasingly taxing for your accounting teams.

Time-Consuming Process

Under VAT accounting, you will be required to maintain records and make timely submissions for your clients. Furthermore, you will also have to deal with the UK VAT regulations which are complex in nature and strictly enforced by regulators. All this leads to significant daily investment in hours, which could have been invested in other core accounting activities. Such high consumption of time by a single activity will reduce the efficiency of your accounting practice, thus reducing your client’s confidence in your accounting services.

Increased Risk of Penalties and Errors

One of the biggest challenges of doing VAT accounting in-house is the risk of making errors. An error in VAT accounting, even if committed unintentionally, will lead to serious consequences for your practice and your client, i.e., high penalties and interest for your client. Your client cannot afford such mistakes, leading to a loss of reputation and business for your practice.

Under VAT accounting comes important tasks such as VAT registration, preparation and submission of VAT returns, VAT audits, and advisory services. The above-mentioned challenges cause considerable hindrance in conducting these VAT tasks. Hence, to tackle these challenges, you can follow the Step-by-Step Guide on How to Complete VAT Return Successfully or choose the option of Outsourced VAT Return UK Services. For now, let’s understand Outsourced VAT Return UK Services in depth.

What is Outsourced VAT Return UK Services

Under the outsourced VAT return UK services, accounting practices based in the UK can delegate their client’s VAT return responsibility to an outsourced VAT services service provider. Apart from handling VAT returns, these service providers will also handle VAT registration, VAT audits, and advisory services on your behalf.

You must have noticed the challenges faced by your accounting practice when it comes to following the VAT regulations set by HMRC, and you are not alone. These challenges have made it necessary for your competitors to use outsourced VAT return UK services.

Having outsourced VAT return UK services by your side is very important because they act as a strong backup to handle complicated VAT return cases. These services will help streamline your VAT return processes and increase your efficiency and productivity. Let’s understand the advantages of outsourced VAT return UK services.

Benefits of VAT Returns Outsourcing

Your competitors increasingly prefer to get their client VAT returns done through outsourced VAT return UK services from outsourced accounting service providers. The reason for this popularity is the advantages offered, which are:

Savings in Cost

One of the biggest advantages of outsourced VAT return UK services is the cost factor. Rising complexity in VAT regulations and increased client expectations have increased the requirement for more helping hands. Without outsourced VAT return services, you will have no other option but to recruit more in-house staff. With more recruitment comes increased associated expenses like salaries, training, benefits, and office infrastructure costs, leading to unnecessary burdens on your budget.

Access to Expertise

We believe your in-house team is the best when it comes to handling VAT returns. However, there will be blind spots, such as keeping a tab on VAT regulations updates made by HMRC on a daily basis. Also, handling the complexity of VAT returns is becoming a tough question due to high time consumption. To handle these challenges, you will require the help of outside experts who are available to service providers offering outsourced VAT return UK services. Their expertise will help you maintain accuracy and reduce the chances of errors and penalties.

 Time Efficiency

You will definitely agree that the UK VAT return process is becoming increasingly complex. HMRC enforces it strictly, so there are no corners to cut. While we believe in fully following regulators’ regulations, this has created a new problem: increased time consumption. Because your in-house team is fully occupied with VAT return tasks, they do not have enough time to focus on value-added services and strategic tasks.

By delegating the responsibility of VAT returns to an outsourced accounting service provider, you are rescuing your in-house team from getting bogged down in VAT paperwork, and you can redirect them to other important tasks.

Access to the Latest Technology and Tools

The VAT return process is cumbersome but can streamlined with the help of the latest technologies and tools. However, getting and incorporating these tools into your system is a significant investment, and many accounting practices will back out. However, if you avail yourself of professional outsourced VAT services, you will get automatic access to the latest tools and technologies the service provider uses. The result of these tools is more efficient and accurate VAT return services.

Cost Comparison Between In-House and Outsourced VAT Return UK Services

Frequency of VAT Returns in the UK

Quarterly submissions are the standard practice for VAT returns in the UK; however, monthly returns can be requested if your client is a frequent exporter. Annual VAT returns are allowed when your taxable turnover is below £1.35 million. The Annual VAT Accounting scheme requires advance payments throughout the year. Only one return is submitted for the complete 12-month period; this return may require a payment or a refund depending on the advance payments made during the year. Based on your client’s requirements, you must choose the right frequency for VAT returns.

What to Do in Case of VAT Repayment

Here is a guide on what you can do to make VAT repayments.

Understand VAT Repayment

Let’s first understand VAT repayment, which happens only when VAT input, i.e., purchases exceed VAT output, which means sales. The meaning is simple: HMRC owes your client money instead of paying it the other way around.

File Your VAT Return

VAT returns have to be submitted on time, and to do so, you can use the HMRC online website or any approved software.

Verify Bank Details

Also, confirm that your client’s bank account details on the HMRC portal are correct. It is important because once the repayment is made, it goes into the account that is available on the portal.

Check the Status

Usually, HMRC processes VAT repayments within 30 days, but if you want to check the status, you can visit the HMRC website or contact the VAT helpline.

Keep Records

There should be no compromise on maintaining records, such as invoices and other supporting documents. During the audit, HMRC will review these records.

Respond to HMRC Queries

If HMRC contacts you for further information or verification, respond promptly to avoid delays. Provide requested documents or clarifications.

Seek Professional Help if Needed

If you experience delays or issues, consider consulting an accountant or VAT specialist through VAT outsourcing services offered by service providers. These service providers can liaise with HMRC on your behalf. Before selecting a service provider for VAT repayment and other related services, ensure that you go through their case studies to understand their work profile, experiences, and successes.

How to Submit a VAT Return in the UK

All VAT-registered businesses are required to submit VAT returns electronically. There are some exceptions; however, in certain circumstances, HMRC must have granted prior approval. Businesses must sign up for HMRC’s VAT online service before electronic VAT returns can be submitted. When an agent completes and submits a business’ VAT returns, the agent will need to register for HMRC’s VAT online service.

Conclusion

The decision to outsource your VAT return task to a professional outsourcing VAT return UK service will be one of the most strategic decisions you will ever make, and it will have a long-lasting impact on your accounting practice. This decision will not only bring monetary and quality benefits to your accounting practice but will also reduce the workload of your in-house accounting team, thus allowing them to focus on other important accounting tasks and improve their work-life balance.

The main goal of this blog is to help you understand the importance of outsourcing VAT return tasks to boost your practice efficiency. You must select a highly professional and reputed outsourced accounting service provider. Of course, you will find multiple accounting service providers in the United Kingdom offering quality services. But if you are looking for a proactive and expert accounting service provider, Corient UK must be your first choice.

We are a professional and experienced outsourced accounting service provider based in Coventry, United Kingdom. Our experts are capable in handling VAT return tasks under our outsourced VAT services. We also offer a wide range of accounting services, from bookkeeping, year end, and payroll to audit and corporation tax services. Our services have positively impacted many accounting practices by streamlining their accounting processes and reducing the workload on their in-house team. We can have the same impact on you. Just state your requirements or doubts on our website contact form, and our executive will contact you.

We are looking forward to a long-term and fruitful partnership.