While the UK is no longer a member of the EU, the changes to VAT that came into force on July 1st could impact businesses selling products and services online to customers.
“The change to EU VAT reporting, which is designed to simplify tax reporting, increase online cross-border transactions and promote e-commerce, should help small businesses new and old operate in a post-Brexit, post-pandemic world.” Small Business
The accounting software systems used at Zoo are HMRC compliant, which makes it easier for small businesses to adopt
What has changed?
The EU has been looking at ways to simplify VAT for goods and service providers since 2015. The challenge was to ensure that each country was using the correct taxes on products imported from other countries. The main change you need to be aware of is that VAT charges are based on the country of the consumer and not the seller.
In addition to this change, the EU is expanding the OSS (one stop shop) simplifications which permit any business located outside of the European Union to submit all sales a one VAT return. Also worth noting that these new one stop shop amendments have removed SME exemptions on shipments under £19. As an e-commerce seller who completes more the 150 sales would benefit from registering for VAT in an EU state or sell their products on platforms like eBay or Amazon.
How Accounting Software Can Help
Accounting software like Xero and Sage are always kept up to date with the latest regulations and ensure that they are HMRC compliant. Small businesses that do not have the time or staff to keep up with the tax changes find these systems can speed everything up, allowing them to concentrate on business without worrying about compliance.
With Brexit and the impact of the pandemic, small businesses have been heavily affected. If you need help in selecting the right accounting software for your business then Zoo Accounting Warwickshire can help. We can offer advice on which system would best suit your growth and seamlessly fit in to your day to day business practices.
For more information, contact us today
Zoo Accounting