A new year, and a time for resolutions to do things better than before. Yet, by this point in January many well-intentioned resolutions have fallen by the wayside, often because they’re simply too ambitious or involve too much of a change.
We’ve all heard the classic lines: ‘Eat better’, ‘drink less’, ‘do more exercise’. But I very much doubt that you’ve heard ‘I’m going to understand VAT better’ uttered by anyone – at least not out loud!
However, I would argue that from a financial management perspective, this IS a resolution that you can meaningfully put into action as it is genuinely achievable. What’s more, there’s little excuse to not act on it now.
Last Autumn, HMRC published, “Help with VAT compliance controls — Guidelines for Compliance GfC8”. This snappily titled piece of guidance perhaps hasn’t made it onto your reading list yet, but in fact it’s pretty accessible and useful!
It details clear processes, describes practical approaches and is relatively easy to understand. Essentially, it details HMRC’s recommended approach for accounting for VAT and the compliance measures that organisations should have in place. If you’ve ever been concerned about an HMRC inspection, this is the standard that they’re going to use to assess you.
In fact, HMRC’s own recommendation is that this is especially useful for anyone who’s responsible for the governance, controls, processing and submitting of VAT returns!
Considering how straightforward and practical this guidance is, my recommendation is simple, everyone who needs to account for VAT, should be viewing this guidance as a must-read. Now, if that’s not an easy resolution to make and stick to, I don’t know what is!
What’s more, this is something that I absolutely believe anyone within the finance function can pick up and run with, and when you do, you’re going to make your external auditing team very happy too!
So, whilst we may be fast approaching the end of January, it’s not too late to put in place positive practices for the year ahead. From a financial perspective, I’d suggest this should be at the top of your reading list. Let me know what you think!