ACCA Taxation F6 Practice Exam 2025 – Complete Study Resource

A business registered for Value Added Tax (VAT) is mandated to submit a VAT return. This requirement stems from the need for the tax authority to monitor taxable sales and the input tax that businesses can reclaim. Registered businesses are those that have exceeded the VAT registration threshold or chosen to register voluntarily.

These returns provide essential details such as the amount of VAT charged on sales, the VAT incurred on purchases, and ultimately the amount payable to, or reclaimable from, the tax authority. Ensuring compliance with this requirement helps maintain the integrity of the VAT system and ensures that businesses fulfill their tax obligations accurately.

In contrast, unregistered businesses do not have this requirement because they are not collecting VAT on their sales. Consequently, they do not have input VAT to reclaim or output VAT to report, which is why they do not submit VAT returns. Therefore, the focus on registered businesses aligns with the administrative and regulatory framework governing VAT compliance.