Turnover...

[Hodge]

To a large extent the overheads of a two man team ought to be similar, you may add more equipment which may increase turnover but will also add to costs. Profit is far more important than turnover.

 

I do think that if you are not reaching the vat threshold of around 80K you are probably not really making the money that you deserve. The running costs of a van, chipper, groundy etc are going to be fairly similar around the country. Like Skyhuck I also think many people don't really know what their costs are.

 

Last year I did £250k (3 man team and occasional subbies) this year won't be anywhere near as much, the year before was around £130k in previous years I had done 80-90k and TBH I had not made as much as I would have liked. I think for a 2 man team around the 100k mark ought to be ideal.

 

FWIW I would rather bring the vat threshold down to 50k so it was a fairer environment for everyone, it would be hard to operate a serious business turning over less than 50k whereas a higher threshold merely punishes those who climb above it. Hardly an incentive to expand your business and contribute more to our ailing economy....

 

That would be better, maybe even 30k vat limit then that should cover most small businesses, then it would be fairer, as when quoting for work most people ask if there is vat and most all ways say they would rather not pay vat, even though they pay it on most things but it is all ready added into the price.

Your posts are very informative Tom, and people can learn from them:)

[Hodge]

To a large extent the overheads of a two man team ought to be similar, you may add more equipment which may increase turnover but will also add to costs. Profit is far more important than turnover.

 

I do think that if you are not reaching the vat threshold of around 80K you are probably not really making the money that you deserve. The running costs of a van, chipper, groundy etc are going to be fairly similar around the country. Like Skyhuck I also think many people don't really know what their costs are.

 

Last year I did £250k (3 man team and occasional subbies) this year won't be anywhere near as much, the year before was around £130k in previous years I had done 80-90k and TBH I had not made as much as I would have liked. I think for a 2 man team around the 100k mark ought to be ideal.

 

FWIW I would rather bring the vat threshold down to 50k so it was a fairer environment for everyone, it would be hard to operate a serious business turning over less than 50k whereas a higher threshold merely punishes those who climb above it. Hardly an incentive to expand your business and contribute more to our ailing economy....

 

That would be better, maybe even 30k vat limit then that should cover most small businesses, then it would be fairer, as when quoting for work most people ask if there is vat and most all ways say they would rather not pay vat, even though they pay it on most things but it is all ready added into the price.

Your posts are very informative Tom, and people can learn from them:)

[gensetsteve]

Wow i can only dream of these figures, been a 1 man band furniture maker / carpenter and joiner for 25 years just done my accounts for 2011-2012 turnover just under £22,000 running costs and materials just under £10,000 so a miserable profit of £12k. own my house, partner doesn't work 2 kids,£18 per hour 5 days a week no holidays, top it up with savings, stressed up to my eye balls. Perhaps i should get a proper job as the other half keeps suggesting.

 

I would say your choices are. improve what you are doing 5 days a week. give up and become a wage slave. or work for some one part time and carry on your business 2-3 days a week put your prices up as you dont now rely on it.

[gensetsteve]

Wow i can only dream of these figures, been a 1 man band furniture maker / carpenter and joiner for 25 years just done my accounts for 2011-2012 turnover just under £22,000 running costs and materials just under £10,000 so a miserable profit of £12k. own my house, partner doesn't work 2 kids,£18 per hour 5 days a week no holidays, top it up with savings, stressed up to my eye balls. Perhaps i should get a proper job as the other half keeps suggesting.

 

I would say your choices are. improve what you are doing 5 days a week. give up and become a wage slave. or work for some one part time and carry on your business 2-3 days a week put your prices up as you dont now rely on it.

[rovers90]

That would be better, maybe even 30k vat limit then that should cover most small businesses, then it would be fairer, as when quoting for work most people ask if there is vat and most all ways say they would rather not pay vat, even though they pay it on most things but it is all ready added into the price.

Your posts are very informative Tom, and people can learn from them:)

 

Slight derail here but why not scrap VAT threshold completely - whatever it is some people are going to say it should be higher. If VAT rate was reduced to say 10% and everybody paid it more might get collected for the government. As it is companies who are VAT registered just pass it down the line until it stops with the little guy who isnt registered and therefore he has to pay it. Meanwhile umpteen companies might have paid it then claimed it back which seems a bit of a pointless exercise.

[rovers90]

That would be better, maybe even 30k vat limit then that should cover most small businesses, then it would be fairer, as when quoting for work most people ask if there is vat and most all ways say they would rather not pay vat, even though they pay it on most things but it is all ready added into the price.

Your posts are very informative Tom, and people can learn from them:)

 

Slight derail here but why not scrap VAT threshold completely - whatever it is some people are going to say it should be higher. If VAT rate was reduced to say 10% and everybody paid it more might get collected for the government. As it is companies who are VAT registered just pass it down the line until it stops with the little guy who isnt registered and therefore he has to pay it. Meanwhile umpteen companies might have paid it then claimed it back which seems a bit of a pointless exercise.

[gensetsteve]

Slight derail here but why not scrap VAT threshold completely - whatever it is some people are going to say it should be higher. If VAT rate was reduced to say 10% and everybody paid it more might get collected for the government. As it is companies who are VAT registered just pass it down the line until it stops with the little guy who isnt registered and therefore he has to pay it. Meanwhile umpteen companies might have paid it then claimed it back which seems a bit of a pointless exercise.

 

I can see your point. Also alot of large organisations do very well out of it. WHSmiths are onto a winner very little they sell has vat on yet they claim it back on their expenses. No vat on travel or insurance or AA break down cover

[gensetsteve]

Slight derail here but why not scrap VAT threshold completely - whatever it is some people are going to say it should be higher. If VAT rate was reduced to say 10% and everybody paid it more might get collected for the government. As it is companies who are VAT registered just pass it down the line until it stops with the little guy who isnt registered and therefore he has to pay it. Meanwhile umpteen companies might have paid it then claimed it back which seems a bit of a pointless exercise.

 

I can see your point. Also alot of large organisations do very well out of it. WHSmiths are onto a winner very little they sell has vat on yet they claim it back on their expenses. No vat on travel or insurance or AA break down cover

[Hodge]

Slight derail here but why not scrap VAT threshold completely - whatever it is some people are going to say it should be higher. If VAT rate was reduced to say 10% and everybody paid it more might get collected for the government. As it is companies who are VAT registered just pass it down the line until it stops with the little guy who isnt registered and therefore he has to pay it. Meanwhile umpteen companies might have paid it then claimed it back which seems a bit of a pointless exercise.

 

Good idea, it would make for an even playing field and make more money to sort the country out.

[Hodge]

Slight derail here but why not scrap VAT threshold completely - whatever it is some people are going to say it should be higher. If VAT rate was reduced to say 10% and everybody paid it more might get collected for the government. As it is companies who are VAT registered just pass it down the line until it stops with the little guy who isnt registered and therefore he has to pay it. Meanwhile umpteen companies might have paid it then claimed it back which seems a bit of a pointless exercise.

 

Good idea, it would make for an even playing field and make more money to sort the country out.