Opting for vat in any eu country including the UK where VAT has been adopted since many years will require you to issue special invoices and maintaining proper records of these vat invoices is mandatory. You will need to summarize vat amounts in your designated vat returns as well as make these invoices available to any vat officer that conducts a vat audit on your business.
Upon turning into a vat registered trader in the UK you will automatically need to follow all uk vat rules set up by HM Revenue and Customs or hmrc department. These rules are based on eu vat rules issued by the European Commission and are generally followed by other eu countries that have also adopted vat such as Portugal, Italy, Spain, Sweden, Poland, Germany, etc. Most eu countries allow traders to issue vat invoices in specific languages too. Thus, in Poland you will find a faktura invoice being issued during any vat sale, which in turn is the same as a vat invoice issued in the UK.
These invoices need to specifically mention your vat registration number or vat no. along with your business name and address. The serial number of such invoices too should be in sequential order. These invoices also need to mention applicable vat rates against each product or service. For example if your invoice contains 2 products where one product is taxed at the standard vat rate of 17.5% and the other at the reduced vat rate of 5%, then these percentages and rates should be specifically mentioned against each product. Finally, these invoices should also display the vat amounts as well as the gross amount of the complete invoice at the bottom. These invoices will make it easy for you and others to find out the exact vat rates, vat amounts and gross amounts and these figures will also need to be summarized in your vat returns. You can visit the hmrc website to look at samples of such invoices.
If you opt for the standard vat accounting scheme then you will surely need to maintain all records of such vat invoices in detail. If, however, you opt for the flat vat rate accounting scheme then although you will need to mention vat amounts in your invoices, you will be spared the trouble of maintaining detailed records of each invoice. You will also require specific vat amounts when filing for vat refunds if you have already paid vat in a foreign eu country that follows vat. An experienced vat agent would be a welcome addition to your team since maintaining vat records, filing vat returns and following up on vat refunds that could take up to 8 months can be tiring, and your vat agent could take care of all paperwork while leaving you free to focus on increasing your business.
The hmrc vat department has specified on the type of invoices that need to be issued based on the vat accounting scheme that you have chosen after turning into a vat registered trader. These invoices are known as vat invoices and they need to clearly specify your vat number along with vat rates and other details that would be of great help while filing your vat returns and vat refunds too.