A: The cash accounting scheme is purely a cash flow easement for businesses to be able to report and pay their VAT to HMRC based on receipts rather than tax points; it does not change the tax point of a supply. Regulation 60/1 SI1995/2518 states that ‘a person shall withdraw from the scheme immediately at the end of a prescribed accounting period of his if the value of taxable supplies made by him in the period of one year ending at the end of the prescribed accounting period in question has exceeded £1,600,000.’ The value of taxable supplies is unchanged by using cash accounting, all that changes is when you have to report and pay the VAT to HMRC. When considering your turnover to determine your eligibility to remain on the cash accounting scheme therefore, you must look at the tax points.