Hammond To Reduce VAT Threshold In Budget?
Discussion
http://www.telegraph.co.uk/news/2017/11/03/one-mil...
In two minds about this. On the one hand it will add extra red tape for many one man band businesses. On the other it removes a questionable competitive advantage and levels the playing field somewhat. The current threshold is way too high compared to most other European countries.
In two minds about this. On the one hand it will add extra red tape for many one man band businesses. On the other it removes a questionable competitive advantage and levels the playing field somewhat. The current threshold is way too high compared to most other European countries.
Edited by plasticpig on Saturday 11th November 09:47
alock said:
I'm PAYE but write and sell software through my own LTD in my spare time. I have very few expenses to produce my product.
I'm soon going to have to pay VAT alongside the corporation tax and dividend tax I already pay? I don't know why I bother trying.
You won't pay VAT, you will collect it for HMRC by charging it to your customers.I'm soon going to have to pay VAT alongside the corporation tax and dividend tax I already pay? I don't know why I bother trying.
PurpleMoonlight said:
alock said:
I'm PAYE but write and sell software through my own LTD in my spare time. I have very few expenses to produce my product.
I'm soon going to have to pay VAT alongside the corporation tax and dividend tax I already pay? I don't know why I bother trying.
You won't pay VAT, you will collect it for HMRC by charging it to your customers.I'm soon going to have to pay VAT alongside the corporation tax and dividend tax I already pay? I don't know why I bother trying.
Would it not be better to just scrap the threshold and just make it mandatory for all businesses.
The problem with the current threshold is a lot of businesses like me are on the borderline, so its more beneficial to do less work to not go over it. (Or as some naughty people do, cash jobs to keep below).
If everyone had to be registered it would be a level playing field?
However it will cost domestic customers more, as a lot will only use someone who is not vat registered.
The problem with the current threshold is a lot of businesses like me are on the borderline, so its more beneficial to do less work to not go over it. (Or as some naughty people do, cash jobs to keep below).
If everyone had to be registered it would be a level playing field?
However it will cost domestic customers more, as a lot will only use someone who is not vat registered.
powerstroke said:
PurpleMoonlight said:
alock said:
I'm PAYE but write and sell software through my own LTD in my spare time. I have very few expenses to produce my product.
I'm soon going to have to pay VAT alongside the corporation tax and dividend tax I already pay? I don't know why I bother trying.
You won't pay VAT, you will collect it for HMRC by charging it to your customers.I'm soon going to have to pay VAT alongside the corporation tax and dividend tax I already pay? I don't know why I bother trying.
A small bedroom software company like OP's will be on flat rate.
PurpleMoonlight said:
You won't pay VAT, you will collect it for HMRC by charging it to your customers.
You're assuming my customers will be perfectly happy paying an extra 20%.In the real world, price points are chosen based on what the market will pay and products are produced for that level. As the creator and exporter of products, I would have to shoulder most (or all) of this cost.
Do you really think charging £119.99 for my £99.99 product would have no impact on sales volumes?
If its £20k turnover it’s going to sweep up the vast majority of small business unless your running a business with a very high profit margin there’s little point being in business for less than £20k turnover a year so as above why not just make it compulsory from the off and lower VAT.
BoRED S2upid said:
...unless your running a business with a very high profit margin there’s little point being in business for less than £20k turnover a year...
Retired people who keep some income by consulting.House wives/husbands who can spend a few hours per week doing something in their own hours.
Full time employees trying to setup on their own in their spare time.
These are the very people that should be encouraged. The first two relieve dependencies on the state, the last are the potential future employers.
Bristol spark said:
Would it not be better to just scrap the threshold and just make it mandatory for all businesses.
The problem with the current threshold is a lot of businesses like me are on the borderline, so its more beneficial to do less work to not go over it. (Or as some naughty people do, cash jobs to keep below).
If everyone had to be registered it would be a level playing field?
However it will cost domestic customers more, as a lot will only use someone who is not vat registered.
In our game 20% VAT makes you about 10% more expensive; most customers would rather pay that 10% for a good/recommended bloke in my experience.The problem with the current threshold is a lot of businesses like me are on the borderline, so its more beneficial to do less work to not go over it. (Or as some naughty people do, cash jobs to keep below).
If everyone had to be registered it would be a level playing field?
However it will cost domestic customers more, as a lot will only use someone who is not vat registered.
My problem is I bumble along at the VAT threshold, I could de register but might need some creative accounting, and I do have a few biz clients that prefer to see a VAT invoice. Its an annoyance knowing what to do for best.
VAT is very efficient as it doesnt require too much government beaurocracy in collection, and is paid on turnover after you've made some money so bad quarter=small bill, I'd prefer VAT increases and other, inefficient taxes and tolls abandoned and reliefs introduced, and think this would encourage biz.
Soon it will be every company needs to be VAT registered..... apart from chinese companies with their stock in the UK, they can continue to take the piss.
VAT absolutely kills the profit in my business, I cannot add 20% to prices when chinese sellers are paying no Vat and no corp tax. I have to absorb it in the price of the products .This is just one type of business (ecommerce).
VAT absolutely kills the profit in my business, I cannot add 20% to prices when chinese sellers are paying no Vat and no corp tax. I have to absorb it in the price of the products .This is just one type of business (ecommerce).
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