VAT Threshold

[Thespanishtiler]

Hi all

I am getting rather concerned that i may reach the vat threshold on my turnover in this financial year and came quite close last year.

any advice/general experiance of this and being vat registered would be apreciated. i am seeing the accountant tommorow so thought a few pointers from you lads my help me get the best of his time.

thanks in advance

 

[TilingLogistics]

You probably need to talk to Grumpy about this. I am VAT Reg'd but it really helps me. The problems I can see with fixers if you are doing lots of domestic is you are immediately 17.5% more expensive.

I think you need to weigh up the pro's and cons with opinions and by talking to your accountant. You can also claim back all your VAT on capital outlay in the last three years so that can help as well

Kev

 

[Thespanishtiler]

thanks Kev

interesting if i can clain the vat on my past 3 years capital items

i would rather stay as i am but since i moved into kitchen and bathroom supply/install the turnover has gone through the roof, looks like i may have my hand forced.

cheers

 

[Deleted member 1779]

Some companies go on holiday when they reach the level to avoid going over.

We are VAT registered and its amazing what you can claim that is used in everyday life and claim back the VAT.

Like for example I bought a camera which is a Nikon D40 for £240 and so I was able to reclaim the VAT becuase I use it for work. So anything at home that you use for work can save you quite a bit.

But as mentioned above its a balance and your accountant can help. Grumpy is one so well able to comment.

One thing I didnt know (but do now) is as a SOLE trader that now I am registered the VAT number applies to me as a person.

When I go to a job and drill tiles then I have to pply VAT. In fact everything I do I have to add VAT too.

 

[UKTT Darren]

You will defo not like the big cheques every three months that you have to write out to the revenue, plus the hassle of doing your VAT returns or paying your accountant to do them for you, best out of it if possible, if you are turning a lot of business and way over the VAT threshold, then its tolerable, if you are just over you will loose out big time, best to be under

 

[grumpygrouter]

Some companies go on holiday when they reach the level to avoid going over.

We are VAT registered and its amazing what you can claim that is used in everyday life and claim back the VAT.

Like for example I bought a camera which is a Nikon D40 for £240 and so I was able to reclaim the VAT becuase I use it for work. So anything at home that you use for work can save you quite a bit.

But as mentioned above its a balance and your accountant can help. Grumpy is one so well able to comment.

One thing I didnt know (but do now) is as a SOLE trader that now I am registered the VAT number applies to me as a person.

When I go to a job and drill tiles then I have to pply VAT. In fact everything I do I have to add VAT too.

Strictly speaking Richard, you are supposed to apportion the work/private use and make appropriate adjustments to the VAT reclaimed section of you calculations.

 

[Dan]

I'm sure it's really 100% used by the firm, and then lent at a cost that's written off to him when he's off to soak up sun.

 

[grumpygrouter]

I'm sure it's really 100% used by the firm, and then lent at a cost that's written off to him when he's off to soak up sun.

I'm sure he does.

 

[CBTC]

If you do have / want to register then find out about the percentage scheme; this allots an industry standard % - ours is 8.5% - so in brief you just total up your turnover (earnings) for each qtr and pay 8.5%. Yes it works out a little more but relieves you of doing the paperwork record keeping / submission, which as anyone who does it will tell you ( as a sole trader) is pretty much worth the time saved.
The anual payment scheme spreads the payments over the year, rather than the lump each qtr - which helps too. They can both be done together.

 

[graham31]

not that knowledgeable about VAT what is the threshold for annual turnover?

Can it vary from trader to trader? :huh2:

 

[grumpygrouter]

If you do have / want to register then find out about the percentage scheme; this allots an industry standard % - ours is 8.5% - so in brief you just total up your turnover (earnings) for each qtr and pay 8.5%. Yes it works out a little more but relieves you of doing the paperwork record keeping / submission, which as anyone who does it will tell you ( as a sole trader) is pretty much worth the time saved.
The anual payment scheme spreads the payments over the year, rather than the lump each qtr - which helps too. They can both be done together.

This is not quite true, if you read the regulations concerning this you are still required to keep full records as per the vat guide. It just makes the actual calculation a bit simpler. If you have to keep full records, you may as well submit the correct, smaller amount, imo.

not that knowledgeable about VAT what is the threshold for annual turnover?

Can it vary from trader to trader? :huh2:

Currently the threshold is £68,000. and no, it doesn't vary. Only difference can be if you are making only "exempt" supplies in which case your registration request could be refused.

 

[TilingLogistics]

You can also voluntarily apply to become VAT Reg'd even if you are below the threshold. This can be useful if you are say buying a new van for example and want your previous three years of VAT back that you outlaid on capital costs.

I don't know about the camera though from Richard at 356. Any tips on how I can claim back the VAT on the washing machine I just bought:lol::lol:

Kev

 

[grumpygrouter]

You can also voluntarily apply to become VAT Reg'd even if you are below the threshold. This can be useful if you are say buying a new van for example and want your previous three years of VAT back that you outlaid on capital costs.

I don't know about the camera though from Richard at 356. Any tips on how I can claim back the VAT on the washing machine I just bought:lol::lol:

Kev

If it is wholly and entirely used for business purposes, yes you can claim the vat back.

 

[Deleted member 1779]

Oh yes well um err well OF COURSE I would apportion the VAT but I dont actually use my camera for private or take on holiday.

No No. - Far too big. Ehem

For work use always....

PS: Going to Las Vegas for a week with wife. And the guy who builds my machines for the factory plus his wife. Total cost of trip including flights and accom is costing £1000 per adult. So thats £4K because the wives are coming (*please read carefully I said Wives - Not WIVERS)

I recon it should be classified as a business trip that we can claim VAT and expenses back from. All we need do is visit some tile shop in the USA. Fact finding to reconfigure the drill sizes into inches from metric so visiting for advice.

The wife (shes an accountant) ACCA qualified. Says NO.

 

[bigandy]

Tilinglogistics if your misses(or partner for the pc brigade)is anything like mine she wo'nt allow my tiling gear in the same washing machine as her clothes so a seperate machine is needed therefore i beleive the vat is claimable

 

[TilingLogistics]

Tilinglogistics if your misses(or partner for the pc brigade)is anything like mine she wo'nt allow my tiling gear in the same washing machine as her clothes so a seperate machine is needed therefore i beleive the vat is claimable

:lol::lol:

Kev

 

[grumpygrouter]

Oh yes well um err well OF COURSE I would apportion the VAT but I dont actually use my camera for private or take on holiday.

No No. - Far too big. Ehem

For work use always....

PS: Going to Las Vegas for a week with wife. And the guy who builds my machines for the factory plus his wife. Total cost of trip including flights and accom is costing £1000 per adult. So thats £4K because the wives are coming (*please read carefully I said Wives - Not WIVERS)

I recon it should be classified as a business trip that we can claim VAT and expenses back from. All we need do is visit some tile shop in the USA. Fact finding to reconfigure the drill sizes into inches from metric so visiting for advice.

The wife (shes an accountant) ACCA qualified. Says NO.

I think she is maybe trying to give her self a little profession protection Richard. I have a client that has never had a "holiday" in 20 years. he has always found a "reason" for it to be a business trip and HMRC have checked him out and have said yes, ok! (I don't do his final accounts by the way, only assist with some book-keeping advice and software support!)

 

[wivers]

I was getting all excited then ...