VAT Return
Definition
A periodic return on which a VAT-registered business reports the VAT it charged on sales (output VAT) and the VAT it paid on purchases (input VAT), paying over or reclaiming the difference.
Related Terms in International Tax
VAT Registration Threshold
The level of taxable turnover above which a business must register for VAT. The threshold varies by country and is updated periodically, so the current figure should be confirmed for the jurisdiction.
Reverse Charge Mechanism
A VAT/GST rule shifting the obligation to account for tax from the supplier to the customer, common on cross-border services and certain domestic supplies. The customer records both the output and input tax on the same transaction.
VAT Flat Rate Scheme
A simplified UK VAT scheme where a business pays a fixed percentage of its gross turnover as VAT instead of tracking input and output VAT in detail. It trades some accuracy for far simpler accounting.
Corporation Tax (UK)
The tax UK companies pay on their profits, including trading profits, investment income and chargeable gains. Companies must file a return and pay by set deadlines after their accounting period ends.
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