Retired Climber

2 minutes ago, Puffingbilly413 said:

Perhaps. I’d be disappointed if this accountant was on less  than 90k a year having seen my accountancy bills…

Is he self employed, or working for a firm? 

2 minutes ago, Puffingbilly413 said:

Undecided on that one Steve!

Logically, is a bloke who sits behind a desk all day for 40 grand a year the right bloke to ask how to make money? No. 

34 minutes ago, Puffingbilly413 said:

I had the VAT registration discussion with my accountant last year as I was thinking of registering voluntarily for the reasons many have said. He told me I was bonkers and only do it when you have to.

 

i guess even accountants have different thoughts on the subject.

It's not just an accounting decision, it's a marketing one. 

Don't take business advice from an accountant. 

Edit. I should add, obviously anyone on here with a business large enough to use management accountants can gain value from their advice. I refer to the type of accountant who does your accounts / tax return. 

People complain about not wanting to be an unpaid tax collector, but what's not to like? The Vat man asks me to add 20% to my invoices and give it to him. He asks me to send it to him once a quarter, up to 4 months and a week after I've been given it. He doesn't care what I do with the money whilst I have it, as long as he gets it on time. I have 10s of thousands of pounds to play with however I like. On top of that, I can take off any VAT I've paid before I sent it. 

The only person who loses out with VAT is the poor sap right at the end of the line who's not registered, and can't claim it back. It's a tax for consumers and end users, not businesses. If you are a business and are not registered, you are a mug, and are playing at business, whilst paying tax as a consumer. 

54 minutes ago, Rough Hewn said:

Retired climber, what was your business name when you were working?

I sold the business to an employee and he's still running it. I'm not about to give the name of the business to someone on a forum looking for an argument. 

1 minute ago, Puffingbilly413 said:

Well it's not the 'the' definition, it's HMRC's and they are not the law nor are they infallible.  But I wasn't really disputing that bit.  Rather I meant that running three separate businesses all under the threshold (trees, milling, timber sales) could be perfectly legit.  It's just how and why you arrive there.

 

Even if you were approaching the threshold, you could still have legitimate operational reasons for splitting up the firm.  Firewood takes time to process, timber takes time to mill.  If you're out doing tree work 5 days a week then you can't be doing the other two.  That's not to say you mightn't have avoidance of VAT registration as a motivation, but if you can successfully demonstrate operational/commercial reasons then it could still work fine.

 

It's a bit like the tick box on the tax self assessment forms where you're asked if you are involved in a tax avoidance scheme.  I wonder how many people actually tick to say yes.

You are missing my point, he said the only reason he would split the business would be so that he didn't have to register for VAT. However you look at it, that's artificial separation. 

Anyway, I agree with all of your points, it's just that my point was based on one particular aspect of what had been said. 

8 minutes ago, Puffingbilly413 said:

Perhaps.  But not if it's done properly.  There are of course plenty of mills that just mill, tree firms that just do trees, timber merchants that just sell timber, firewood people that just do firewood.  That is, the precedent is well set for these being legitimately different businesses.

 

Granted, you would risk having to convince the Revenue that splitting up an existing business was done for commercial or operational reasons rather than merely avoidance of VAT registration but that is do-able.  Sound accountancy advice as most have said is key though...

 

Separation of business activities for the reason of avoiding VAT registration is THE definition of artificial separation, and is THE reason mentioned above. 

25 minutes ago, Rough Hewn said:

Please enlighten me doobin.
I don’t have a clue, you’re right.
I just cut wood, I don’t have an accountant yet.

You criticise me (or try to) for having an opinion different to yours, and then admit you haven't got a bloody clue what you are talking about. You claim to have 3 businesses, but none of them takes more than 90 grand a year, and then you think you can separate them to avoid VAT registration of required. You might want to have a bit of a think and do a bit of research before you suggest I'm the one talking rubbish. 

45 minutes ago, Rob D said:

 

Yep you may be right - but I would expect a company like Stihl to be able to make the product so that it is patentable.

 

Only because they prob have a lot of experience with the patent process and the resources to get them and enforce them. As in they can 'build in' something that makes the system patentable.

 

And in many ways IMO it's fair to do it as otherwise where is the incentive to come up with these sorts of new tools..

 

 

Completely agree. They could engineer a novel idea into the design that would make their product patentable, but that idea can't simply be that the file is hexagonal. 

Patent or no patent, it will take days for a boat load of knock offs to leave China. 

I'm not sure if this thread is a joke. I've got this tree with Hazelnuts on it, but I'm not sure what type of tree it is. 

4 minutes ago, Rough Hewn said:

Not you too Mick.
I run 3 businesses,
tree services, Saw milling and timber merchants.
If I get a turnover approaching vat, I’ll just set up each business as a ltd.
Each stays under the vat threshold.
The savings I’d make on new kit are a few hundred or thousand a year. Compared with tens of thousands I’d have to charge in vat.

Also I will point out, if all you want, is to earn more and more money, there are far safer, easier and quicker ways.
As you well know.

Haha, the very definition of artificial separation. 

44 minutes ago, Rob D said:

 

Stihl are well capable of enforcing their patents if they feel like doing so. And as said - I can't find any hex shaped files on the net - so it would be unique.

With respect, just because you can't find something on the net, doesn't mean it could be granted a patent. I'd go as far as to say that a patent for a hex file probably wouldn't be granted (if the hex was the only point of differentiation).

Just now, Rough Hewn said:

Scottish cleaning services or vesp?

Just because I don't agree with you, I must be trolling? 

1 minute ago, Rough Hewn said:

You really know you’re stuff don’t you?

I am stuff? 

You can't own a patent for a hex file. Well, I suppose you could, but you'd have a devil of a job enforcing it.

11 minutes ago, kevinjohnsonmbe said:

There you have it mucker....  "income" is irrelevant when viewed in isolation 😝 

Quite right. You can quite easily double your buying power by simply moving a few hundred miles (or less) in this country. I was looking at houses in Lincolnshire on Rightmove the other week and (give or take) the prices are about 50 % what they are here. You can get a really nice house for about a million up there, where as round here you'd have something that could best be described as 'ordinary'. 

2 minutes ago, trigger_andy said:

You’re quite correct. That’s why he’s not interested. 
 

But up in Scotland with a £400 a month mortgage and total bills of less than £1000 it’s a nice living. 

My post was in response to your comment about 400 quid a day for milling. 

If your brother hasn't earned less than 600 quid a day for the entire year so far, I'm surprised he needs a mortgage. 

1 hour ago, trigger_andy said:

I have no idea what you're talking about! I would like to inform you all that my new Boots and Stihl Post Hole Auger worked perfectly

 

My Brother has some chainsaw tickets and was at Collage whilst serving his time with a local Estate before moving to London to get into the building trade, he worked his way up the ladder in the company he worked for and was even offered to become a member of the board of directors. Its a multi-million pound company with public and private sectors. But he was sick of London and wanted to come back to Scotland to raise his children. To get established up here he's taking on whats essentially odd-jobs to keep a roof over his head but its doing fantastically well for him. Inundated with requests and cherry picks the best. It certainly makes me wonder why I bother slogging my guts out Milling for £400 a day. 

 

Anyway, Im off to clean some windows in my new wellies.  

£400 a day doesn't seem like bad money until you take your costs and tax off. By the time you've done that, and realise you are actually working for not much more than half that, it's a bit depressing. 

8 minutes ago, Rough Hewn said:

You think what I do is a hobby?

Is that question for me? If so, I have no idea what you do, or why you do it. 

You'll notice I also used the term 'self employed', but I suppose it's easier to take offence at the term hobby isn't it. 

4 minutes ago, Steve Bullman said:

This!

 

I can never understand the mentality of people who desperately try and stay under the vat threshold in the mistaken notion that it means they will lose work if they register.

 

My mindset from the start was that if my business ambition was never to cross the threshold then why even be in business.

The threshold is there so a self employed bloke with no staff and few overheads can make a living without needing to register. If you want a business, you need to register. 

Not being VAT registered just tells the world you don't get much work.

As Steve says, it's also a psychological thing. If you are trying to stay under the threshold, you have completely the wrong mindset to make money. 

55 minutes ago, Rough Hewn said:

Absolute rubbish.
Did you open your business on day one with 90k turnover?

No I didn't, but I knew it was going to need to be a business rather than a hobby or simply 'self employment' for me only, so registered for VAT from the off. 

If you want to run a business you are going to need to register for VAT. If you want to play at having a business you may not need to. 

Probably more well known in recent years for his law of robotics. 

His ideas are interesting, but it's no surprise that humans are very predictable, we see it a lot on this very forum .

I think it's a bit like a bee sting; for most of us, most of the time, it's just a slight irritation, but if you are susceptible it can cause you real problems. Obviously quantity breathed in is also relevant. 

It's a very well known problem. 

Aspergillus fumigatus spores are one to watch out for I think.