Online trading compulsory VAT registration from Jan 1st 2016

[fen01]

I thinly I'll going vat reg pretty soon and to be honest it concerns me as most of my work is domestic, perhaps 10% Max commercial. I can't help thinking I'm going to have to drop my rates by 10% or so until I know where I stand.

 

Like most things the worst part will be the first year I expect/hope. What are other people's experiences?

[Marc Lewis]

Just make sure the money you collect for Messrs HMRC sits in a separate account so when the time comes around each quarter, it's there to be paid out. Put it in a high earning account and make a bit.

Start using VAT as your working capital and you're likely to run into cashflow issues.

VAT collection is just another business process. When you start up it's less so it's less of a burden. As you grow it gets to be a bigger beast.

 

Of course the Government wants to be able to tax any form of business, online or high street.

 

If we want the country to keep running, (and here I refuse to get into the in and outs of national spending projections/statistics/bloated bureaucracy), getting a higher tax take combined with cutting the structural deficit is inevitable.

 

Good advice to put money to one side as you collect. Easy to get in serious debt quickly as it snowballs out of control.

[Inoff the Red]

Start using VAT as your working capital and you're likely to run into cashflow issues.

 

VAT collection is just another business process. When you start up it's less so it's less of a burden. As you grow it gets to be a bigger beast.

 

 

I agree it is best to recognise that when cash comes in part of it is not yours and belongs to the government.

 

For business start ups and smaller growing businesses (turnover less than £1.35m), accounting for vat on a cash basis (i.e. when you actually receive/pay ) helps because it means you don't have to pay it over until you have received it.

[Dean Lofthouse]

Don't forget to put away 20% of your perceived profit for income tax too.

[Wood wasp]

You just need to get in mindset that it's not your money plus always think of costs/revenue as ex VAT price.

 

Anyway, point of thread wasn't the rights and wrongs of vat thresholds, it was regarding way it was being implemented. If Labour, for example, put this proposal in their manifesto then you would have chance to vote for them (or not), thus if it was implemented then it would by democratic mandate. There would also be the opportunity to speak directly to the instigating party MP regarding proposal.

[Mark Bolam]

Remember on domestics you don't need to 'add' the VAT.

 

Say on a £1k job you don't have to add £200, you can say the £1k includes the VAT if the pricing is tight.

Yes, you'll lose out in that situation, but remember you can claim back the VAT on pretty much everything you spend.

 

On commercials it's a no brainer.

 

 

Sent from my iPhone using Arbtalk

[frets1]

Don't se the problem to be honest, I wish the government would make it so all businesses had to be vat reg like in sweeden, this would put all business on a level footing and would have the added benefit of showing domestic customers that non vat reg traders wernt legit aka caravan trades men

 

I am not vat registered, but have tickets, insurance, dispose of waste properly etc. I also live in a house.

just because my business doesn't turn over the same as yours, I am, as best as I can be, legit.

[Ian C]

I am not vat registered, but have tickets, insurance, dispose of waste properly etc. I also live in a house.

just because my business doesn't turn over the same as yours, I am, as best as I can be, legit.

 

You miss understand as a legit business your also pricing up against non vat reg non legit "businesses " if all were the same you would not be grouped with the less legit guys.

[frets1]

You miss understand as a legit business your also pricing up against non vat reg non legit "businesses " if all were the same you would not be grouped with the less legit guys.

 

I don't see how being vat registered means you are legit?!

it just reflects you are registered. ive worked for big firms who do bad recommendations, rubbish ppe, 1 man climbing crew with numptys on the ground etc.

ive worked for 1 man bands who strive to do a good and legal job.

perhaps somehow getting customers to ask for tickets, insurance, tax number, etc would be a better approach? they never ask me, well never ask for proof. I agree a more level playing field would be good though.

[padman]

I don't see how being vat registered means you are legit?!

it just reflects you are registered. ive worked for big firms who do bad recommendations, rubbish ppe, 1 man climbing crew with numptys on the ground etc.

ive worked for 1 man bands who strive to do a good and legal job.

perhaps somehow getting customers to ask for tickets, insurance, tax number, etc would be a better approach? they never ask me, well never ask for proof. I agree a more level playing field would be good though.

 

totally agree VAT registered means nought - I know a lot of crooks who are registered

 

I was registered for over 25 years - started at 8% now its 20% greedy government yet again screwing us, all you are is a unpaid tax collector.

 

It was no big deal for me with my commercial work, but when it hit 20% it killed my domestic business.