Value Added Tax
It was first envisioned in the 18th Century by a German economist looking for a sales tax on goods that did not affect the cost of manufacture or distribution.
Quite some time after it was devised, the system was adopted by France in 1954. A few years later, when the Common Market (now the European Union) was formed, it was decided that the imposition of a form of VAT would be a requirement for joining.
Hence, when the UK joined the EEC in 1973, we replaced our existing Sales Tax with VAT.
Dreaded VAT Returns
Many companies have an understandable love / hate relationship with VAT, but despite the dread of regular VAT returns, being VAT registered can bring many benefits and a good accountant is invaluable in realising those benefits.
If your business is close to the threshold, give me a call to discuss VAT registration.
If I've whet your appetite for VAT facts, try the following resources: