Advice for newly V.A.T registered company

[Ian C]

for a start every things 20% cheaper

the VAT man pays for me to have a brand new pickup

VAT man just paid for a ifor Williams tipping trailer

 

I was worried that id loose work by being VAT registered, it hasn't happened and im as busy now as I was before my registration

 

 

I have never been so busy.

[benedmonds]

The flat rate scheme only applies to companies/businesses under £150k, (ish. Don't recall the exact figure.) As we planned on and passed this in our second year it was never going to be worth doing.

.

 

You can join the Flat Rate Scheme for VAT and so pay VAT as a flat rate percentage of your turnover if:

Your estimated VAT taxable turnover - excluding VAT - in the next year will be £150,000 or less.

Once you join the scheme you can stay in it until your total business income is more than £230,000.

 

The Flat Rate Scheme has been working well for us. Simplifies accounting, only adds 10.5% to a domestic bill and commercial clients are charged 20% but you only pay 10.5!

 

I think there is a calculator somewhere where you can put in your details and work out what is best for you.

[Ian C]

On the flat rate you dont claim back on vatable items then am I right?

 

John are you on flat rate or normal?

[benedmonds]

On the flat rate you dont claim back on vatable items then am I right?

 

John are you on flat rate or normal?

 

You claim on capital items over £2000. So any big purchases you get the vat back, but not the other stuff..

[John Shutler]

On the flat rate you dont claim back on vatable items then am I right?

 

John are you on flat rate or normal?

 

normal

[Ian C]

Thought so I can see the advantage for punters and it spreads the extra between you and them.

 

How dp you go on with say plant on finance though if you pay the v a t monthly? Can you not claim it back?

[Gray git]

So on a domestic QUOTE just put in the gross finger for them to see and compare with outher prices but on INVOICE put net + vat = gross and quote your registration no. so everything is present On the invoice.

 

Is this a workable solution as said before its the idea of paying extra tax as opposed to actually paying it that I think affects most domestic customers.

As for commercial iv lost out on jobs because I'm not vat registered because they couldn't claim back anything but have offered to let them pay for plant eg a Mewp Hire direct.

[John Shutler]

Thought so I can see the advantage for punters and it spreads the extra between you and them.

 

How dp you go on with say plant on finance though if you pay the v a t monthly? Can you not claim it back?

 

you don't pay the VAT on gear bought on finance monthly, you pay it in one hit at the start

[Ian C]

you don't pay the VAT on gear bought on finance monthly, you pay it in one hit at the start

 

Not if its on lease finance, you pay the vat monthly with your payment.

[gensetsteve]

So on a domestic QUOTE just put in the gross finger for them to see and compare with outher prices but on INVOICE put net + vat = gross and quote your registration no. so everything is present On the invoice.

 

Is this a workable solution as said before its the idea of paying extra tax as opposed to actually paying it that I think affects most domestic customers.

As for commercial iv lost out on jobs because I'm not vat registered because they couldn't claim back anything but have offered to let them pay for plant eg a Mewp Hire direct.

 

Another way to explain to them is you charge £100 they claim back 40% = £60

 

If you were vat registered £100 less 20% = £80 less 40% = £48 so although they would be better if you were vat registered it is only by 12% if that makes sense. Chances are as a small business you will be cheaper to start with as well they cant have their cake and eat it.