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Vat registered companies.... how do you stay competitive

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25 minutes ago, Eddie Eco said:

My company is VAT registered and 80% of our work is domestic, never really had a problem apart from the odd one or two situations when quoting against others who aren't. Most of the time our competitors are also registered, so not an issue. To be honest I'm surprised more firms aren't - registration has only ever been a good thing for us - everything the firm needs is suddenly 20% cheaper! The only genuine issue we have is cashflow, chasing unpaid invoices when you're return is due!

When o went vat registered the money I saved in vat each month paid the finance on a brand new navara, it was a no brainer really 

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You don’t have a choice if you are at the threshold turnover wise you must register,I hear of many companies with 3 men chipper etc not registered which is ridiculous and if they analyse it they are working for nothing.

we registered 32 years ago on start up of business doing 70% domestic work yes you loose out sometimes,yes you are a tax collector but cash flow wise you should be on it to get paid whether registered or not.

I think the lowering of the threshold is coming the recent vote was just a testing of the water government wise.

Eventually the 20% becomes not important to you existing customers as they wish to employ you and only you if your doing it right.

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3 hours ago, Eddie Eco said:

My company is VAT registered and 80% of our work is domestic, never really had a problem apart from the odd one or two situations when quoting against others who aren't. Most of the time our competitors are also registered, so not an issue. To be honest I'm surprised more firms aren't - registration has only ever been a good thing for us - everything the firm needs is suddenly 20% cheaper! The only genuine issue we have is cashflow, chasing unpaid invoices when you're return is due!

Opt to submit your returns on a cash basis. That way, you only account for vat on sales where the customer has paid. Of course, you can only claim vat on your purchases when they are paid also but it avoids the problem of having to pay vat on sales where you have not yet collected the cash from the customer.

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3 hours ago, Steve Bullman said:

On the flip side you may well find your ‘cash’ flow increases 

That’s what I’m thinking, not sure how it’s a problem. Use the vat money on paid invoices to ease cash flow or bank it until due end of quarter.

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I don’t know what the business answer is but what I’ve always did when my business was growing was explain to my annual hedge cutting customers( as they were only really my regulars ) that I’ll get to them when I can at the old prices, if they want to book me in it would be so much more as I then had bigger kit and staff. The good ones were always happy to wait and wished me well, the bad ones would be stroppy and I’d make them wait longer until they would finally just use someone else.
If I’d had a good week and bills were paid then we would catch the little jobs on a Friday afternoon or Saturday and just blitz our way through the list mob handed, job and finish.

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Interesting read for me as i think i'll have to go vat registered soon but don't particularly want to.

 

Don't get me wrong i'd get a good bit of money back from the new machines I've bought but as I do mainly domestic work and most of my competition isn't vat registered i'm a bit cautious.

 

I would be happier if the threshold was lowered and everyone in the same boat.

 

Jim

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You dont  have to be the whole 20% dearer just because you are vat registered  , in reality being vat registered is going to drop your overheads slightly because you will be claiming  back on quite a large portion of your out goings. You would probably not be out of pocket if you only upped your prices by 10-15% and I doubt if you clients would even notice that.

 

Bob

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1 hour ago, aspenarb said:

You dont  have to be the whole 20% dearer just because you are vat registered  , in reality being vat registered is going to drop your overheads slightly ...10-15%...

And comercial clients you can  charge 20 percent more then non vat reg firms. 

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3 hours ago, benedmonds said:

And comercial clients you can  charge 20 percent more then non vat reg firms. 

Not sure I understand what you mean by this. 

If you are selling to a VAT registered company, when making a purchasing decision they will ignore vat (because they can recover it) and they will compare the cost of the service provided.

 

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