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  1. #41

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    Quote Originally Posted by cojak View Post
    My accountant has a discount with the company which works out at 18pm.

    Still worth it in my view - I had Quickbooks before and it was far too fiddly for me. My accounts are shipshape and me accountant now longer has to nag me at year-end as he can see what he needs to see at any time.
    I used QB for years but when the VAT rate changed twice in a short period recently it wouldn't handle it without a lot of hassle and their support is quite tulip so I moved to Xero.

    Pretty good package, 21 or something pm. Everything on tap wherever I am and VAT returns published and acknowledged in seconds. Wholly worth it imo.

    Why any contractor would consider doing it any other way than online, I don't know. And saving a paltry 20 quid a month doesn't cut it

  2. #42
    Boo
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    Quote Originally Posted by Contreras View Post
    *You* should be the one on end of the phone during the visit, ideally held at the accountant's premises.
    I would say so.

    Boo

  3. #43

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    Default Well survived the VAT inspection

    Survived the VAT inspection.

    In the last week, between the call and the visit, I had gone through all 177 of my invoices since 2006 since the company started.
    And my accountant had done the same to check all invoices and make sure all Sales Invoices were included in the correct VAT quarter.
    I'd messed up a few times over the years mainly due to ending up on a contract that paid weekly and I would work the same 5 days at the same rate so would end up with a number of invoices with same amount. And when i entered these in spreadsheet I sent to accountant I put some in wrong month so got applied to wrong vat quarter.
    But they would be caught later on and a adjustment on the next quarter was done.
    The accountant produced a VAT reconciliation spreadsheet.

    He also said there was a few things he had legally to tell me.
    He listed the rules about submitting, fines, and certain procedures.
    The first thing they're required to ask you is there anything you wish to tell us.

    I explained there was some adjustments.
    He said this is fine, adjustments if not included in the correct quarter can be added later within a specific time period so I said yes that what this reconciliation spreadsheet shows.
    I said my april quarter was due so would just add it to that.
    My other friend in HMRC recommended good coffee and biscuits always made him more lenient. So a trip to waitrose for a cafetiere and nice choccie biscuits paid of because I said 'Do you want to start on the invoices' and he said 'no lets try that coffee'.

    He had a print out of about 3 VAT payment amount so he went back and found the invoices for that quarter. Did the calculations and checked if amt submitted matched his print out.

    One included an adjustment which he couldnt figure out so I had accountant warned to be on the phone so we rang her and she explained it. He hung up and said "well she seems to know whats shes talking about".

    Another vat amount included a large purchase of a Mac so he wanted to see the VAT invoice from apple.
    A quick search of my email and managed to find it. Though best to find them now and keep them with the invoices to agencies.

    So for a visit you need:
    HM Revenue & Customs: Visits by VAT officers

    All Sales Invoices (ones you send to agency)
    All banking - Spreadsheet I send to accountant which includes all these invoices and how theyre used to calculate.
    I had them downloaded but not printed and weirdly it says on the letter about the visit HMRC staff are not allowed to operate a PC on clients site. Client must do it for them. So I had printer wired up and printed anything off he wanted to see.
    Any VAT invoice for large purchases you included in VAT calculation. I'm on FRS so only purchases over 2000+ are included i think.
    Good coffee and biscuits. I was warned "no jaffa cakes"

    He didnt look at:
    Any dividends, expenses.

    Someone asked why I was talking to HMRC if I had PCG+ This was a VAT visit not IR35.
    VAT is pretty easy to calc and rules are more certain.
    Accountant was on the end of the phone to explain the adjustments and paperwork was all correct.
    If it was IR35 then yes straight to PCG+ and get the experts involved.
    I think dragging out lawyers for a VAT visit would really set off alarm bells for HMRC.

    Also looking at freeagent.com

  4. #44

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    +1 to FreeAgent, and thanks for the update.

    I know I've had issues with some self-billing invoices ending up in the wrong VAT period before; I was just explaining the payments into my bank account as sales in FreeAgent which meant they were being recorded in the VAT quarter that I was paid, not necessarily the quarter the invoice was dated. Something to watch out for if you receive self-billing invoices outside of your normal invoice system. I now create duplicate invoices in FreeAgent to ensure my sales and VAT records are correct.

    I also wonder if a VAT inspection would bring up the fact that I haven't applied the reverse charge to services I've bought from (mainly US-based) suppliers, web hosting etc. It doesn't seem like a massive deal as it has no effect on the VAT owed though.

    I've had dealings with the VAT department twice to date but came out the other side just fine on both occasions. One was a bit painful...HMRC took payment for two of my VAT quarters twice (after a cancelled direct debit resulted in a missed payment, I paid by card over the phone and then after setting up the DD again they took payment a second time). I'd just moved and thought I'd updated my address but as I discovered you have to notify the VAT, CT and PAYE departments separately!

    So I spoke to HMRC about the double payment and they said - don't worry, just deduct the overpayment from your next VAT payment as your account is in credit. Which I did. Unbeknownst to me, they decided to then refund the overpayment by sending me a cheque to my old address. I didn't find out anything until I started getting debt collector letters. I no longer had access to my post so HMRC had to cancel the refund cheques and update my account but it all got sorted in the end.
    Last edited by TheCyclingProgrammer; 20th May 2014 at 12:10.

  5. #45

    Double Godlike!

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    Quote Originally Posted by clearbrian View Post
    ...snip...
    Someone asked why I was talking to HMRC if I had PCG+ This was a VAT visit not IR35.
    VAT is pretty easy to calc and rules are more certain.
    Accountant was on the end of the phone to explain the adjustments and paperwork was all correct.
    If it was IR35 then yes straight to PCG+ and get the experts involved.
    I think dragging out lawyers for a VAT visit would really set off alarm bells for HMRC.

    Also looking at freeagent.com
    Because by not invoking your cover you would potentially have invalidated it? The point of PCG Plus is that it cover any tax query, including VAT, and that's because more than a few VAT inspections have turned into aspect inquiries; had they not accepted your explanations for the "adjustments" (which smacks of sloppy book-keeping) that's where yours would have gone.

    You don't have to send in the legal wolfpack, but it's silly not to have them on standby. for the sake of a phone call.
    Blog? What blog...?

  6. #46

    Some things in Moderation

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    +1 for Freeagent.

    95% of my receipts are attached to my expenses logged in there.

    As are my company credit card statements.

    And my bank statements.

    And my invoices generate my VAT calculations which I submit via FreeAgent.

  7. #47

    Contractor Among Contractors


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    Quote Originally Posted by clearbrian View Post
    ... a trip to waitrose for a cafetiere and nice choccie biscuits paid of because I said 'Do you want to start on the invoices' and he said 'no lets try that coffee'.


    Quote Originally Posted by clearbrian View Post
    Someone asked why I was talking to HMRC if I had PCG+ This was a VAT visit not IR35.
    VAT is pretty easy to calc and rules are more certain.
    Accountant was on the end of the phone to explain the adjustments and paperwork was all correct.
    If it was IR35 then yes straight to PCG+ and get the experts involved.
    Basic PCG covers IR35 already, PCG+ adds cover for VAT and other tax matters.

    There are a few other '+' member benefits too, btw (to save anyone having to point that out).

    Quote Originally Posted by clearbrian View Post
    I think dragging out lawyers for a VAT visit would really set off alarm bells for HMRC.
    I really don't see why it should. They're tax consultants, not lawyers.

    But in any case, well done!

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