Discussion
Afternoon all!
First year as self employed (Sole Trader) Submitted my self assessment, My business turnover was £88.3k for the tax year, so just under £3k over the threshold. Obviously my Net profit was far less than this, quite pitiful actually.
What happens now? I have a few questions..
1) Have I paid an additional 20% tax on my earnings as I'm over the threshold?
2) Do I have to register for VAT, seems a bit strange as other people I know aren't Vat registered, but must have a bigger turnover than me.
3) How does this affect my business this year?
We are getting busier, and I am debating taking on another fitter, so Is it worth registering for VAT? The majority of my work is domestic clients, Im worried that by doing so I will price myself out of a lot of work. Im a fencing contractor if thats at all relevant.
First year as self employed (Sole Trader) Submitted my self assessment, My business turnover was £88.3k for the tax year, so just under £3k over the threshold. Obviously my Net profit was far less than this, quite pitiful actually.
What happens now? I have a few questions..
1) Have I paid an additional 20% tax on my earnings as I'm over the threshold?
2) Do I have to register for VAT, seems a bit strange as other people I know aren't Vat registered, but must have a bigger turnover than me.
3) How does this affect my business this year?
We are getting busier, and I am debating taking on another fitter, so Is it worth registering for VAT? The majority of my work is domestic clients, Im worried that by doing so I will price myself out of a lot of work. Im a fencing contractor if thats at all relevant.
yes, you have to register
https://www.gov.uk/vat-registration/when-to-regist...
you will need to start collecting vat from your customers from your registration date and you can start reclaiming vat on your eligible purchases too
consider a flat rate scheme
https://www.gov.uk/vat-flat-rate-scheme
but, if you are expanding to the point of taking on another fitter, the normal scheme is likely (but not certainly) going to suit your business best
https://www.gov.uk/vat-registration/when-to-regist...
you will need to start collecting vat from your customers from your registration date and you can start reclaiming vat on your eligible purchases too
consider a flat rate scheme
https://www.gov.uk/vat-flat-rate-scheme
but, if you are expanding to the point of taking on another fitter, the normal scheme is likely (but not certainly) going to suit your business best
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