VAT Flat Rate Scheme
Discussion
NoelWatson said:
biglepton said:
cerbfan said:
I use it, makes me between 4 and 5k a year. Ideal if you are contracting and have little to no outgoings.
Same here - I used it for a business that had virtually no expenses and few large and fairly simple invoices. It was pretty much 6.5% extra profit in my pocket. The fixed rate VAT return is pretty simple - if I can do it, I would've thought most people could.I hate the fact that HMRC send the same form to those of us on the flat rate scheme, why not a slightly different one which gives a correct set of instructions. Even when you complete it online, the guidelines are wrong.
Think I'm right that you can switch between the two, so if in one quater you do buy alot of things you want to claim back th VAT on you can.
Think I'm right that you can switch between the two, so if in one quater you do buy alot of things you want to claim back th VAT on you can.
Domi said:
Eric Mc said:
Definitely not.
You can reclaim Input VAT onm Capital Expenditure exceeding £2,000 only.
So if you purchase computer equipment exceeding 2k in quater 1 can you not claim back the VAT and then switch back to flat rate in quater 2?You can reclaim Input VAT onm Capital Expenditure exceeding £2,000 only.
This is why my IT purchases for the foreseeable future have all been done this quarter before I switch to flat rate next quarter
cerbfan said:
NoelWatson said:
biglepton said:
cerbfan said:
I use it, makes me between 4 and 5k a year. Ideal if you are contracting and have little to no outgoings.
Same here - I used it for a business that had virtually no expenses and few large and fairly simple invoices. It was pretty much 6.5% extra profit in my pocket. The fixed rate VAT return is pretty simple - if I can do it, I would've thought most people could.Although I work in engineering per se, project management they classified as business to business services.
Domi - if you are on Flat Rate you are still allowed to claim the VAT on Capital Expenditure over £2,000. You do not have to come off the scheme.
The main proviso is that if you can claim back the VAT on this over £2,000 Capital Expenditure, whenever you sell this equipment (whatever it is), you MUST declare and pay to the VAT man VAT at the full 17.5% on the VAT Exclusive sale price.
In other words, that sale falls outside the Flat Rate Scheme.
The main proviso is that if you can claim back the VAT on this over £2,000 Capital Expenditure, whenever you sell this equipment (whatever it is), you MUST declare and pay to the VAT man VAT at the full 17.5% on the VAT Exclusive sale price.
In other words, that sale falls outside the Flat Rate Scheme.
Edited by Eric Mc on Tuesday 15th January 15:51
cerbfan said:
I use it, makes me between 4 and 5k a year. Ideal if you are contracting and have little to no outgoings.
I tried to get on it but HMRC uses a rolling year and if they think you wil go over the limit (£135K it was then) they won't let you play. As our business peaks and troughs between years ( good year, then 'bad' year due to the cycle of a large contract we have ) I can never get a period when we are under the £135K long enough to convince them than on average we might be under it. Even when we have three quarters under £34K they point to the previous year.
It might work for me because my overheads are minimal and the bulk of what I do pay out in project costs is rarely VATable.
Arent the inland revenue great?
Plan on doing your big purchases this period for flat rate starting next? Well they only go and get your flat rate application through and allow you to start the rate on the 1st November (current VAT period start for me).
I dont know whether I should be happy or annoyed
Plan on doing your big purchases this period for flat rate starting next? Well they only go and get your flat rate application through and allow you to start the rate on the 1st November (current VAT period start for me).
I dont know whether I should be happy or annoyed
Gordon Brown said:
cerbfan said:
I use it, makes me between 4 and 5k a year. Ideal if you are contracting and have little to no outgoings.
I tried to get on it but HMRC uses a rolling year and if they think you wil go over the limit (£135K it was then) they won't let you play. As our business peaks and troughs between years ( good year, then 'bad' year due to the cycle of a large contract we have ) I can never get a period when we are under the £135K long enough to convince them than on average we might be under it. Even when we have three quarters under £34K they point to the previous year.
It might work for me because my overheads are minimal and the bulk of what I do pay out in project costs is rarely VATable.
JustinP1 said:
Gordon Brown said:
cerbfan said:
I use it, makes me between 4 and 5k a year. Ideal if you are contracting and have little to no outgoings.
I tried to get on it but HMRC uses a rolling year and if they think you wil go over the limit (£135K it was then) they won't let you play. As our business peaks and troughs between years ( good year, then 'bad' year due to the cycle of a large contract we have ) I can never get a period when we are under the £135K long enough to convince them than on average we might be under it. Even when we have three quarters under £34K they point to the previous year.
It might work for me because my overheads are minimal and the bulk of what I do pay out in project costs is rarely VATable.
The measure increases the VAT exclusive annual taxable turnover ceilings for entry to the scheme from £100,000 to £150,000 and the total turnover ceiling from £125,000 to £187,500
Eric Mc said:
Damn - he beat me to it.
Eric, you are just going to have to make sure that you are in front of your PC and you refresh this forum quicker than every 12 minutes next time...
You are still the only accountant in the UK you can get the right answer from at 8PM at night within 15 minutes, so I wouldnt worry!
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