Errors in the preparation and submission of VAT returns can be very expensive for businesses. It is important that businesses review their VAT returns regularly and have sound internal procedures in place to ensure that VAT returns are completed correctly.
One common item that businesses overlook is the requirement to repay VAT reclaimed in respect of creditors outstanding for more than six months.
If within six months of the end of the VAT return in which the VAT was repaid, the invoice has not been repaid there is a requirement for the VAT to be repaid to Revenue.
As part of a Revenue aspect query / audit, Revenue will routinely review the creditors ledger to ensure that the appropriate adjustment has been made. If the adjustment has not been made the VAT will be need to be repaid. Interest on the late payment of VAT and a penalty may also be levied by Revenue.
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What approach to use: A valuation approach is the method used to determine the fair market value of a business.
The most common approaches are:
The market approach is based on finding prices for comparable businesses or transactions in the public or private markets and using them to infer the value of the business or transaction. Two methods to determine the market value of a business are:
The income approach is based on determining future earnings and calculating the present value. Two common approaches are:
This is based on the value of business being equal to the sum of all the parts of the business. Adjusting book value of each asset or liability to fair market value.
So, which do you use: it depends on the specific circumstances of the business being valued.
We are happy to help. Please post your comment below or call Lisa Byrne, Audit Manager at Cooney Carey, on 01 677 9000. Alternatively, send her an email: firstname.lastname@example.org
The EU are reviewing the operation of Vat within the European Union. The following proposals have been made:
The Cornerstones of a definitive vat regime