Switching from FRS to Standard VAT

[northernladuk]

And, erm, if she's a trainee accountant why didn't you ask your wife?

[SouthernManc78]

And, erm, if she's a trainee accountant why didn't you ask your wife?

I did ask her about original question at the beginning of the post but as she is a trainee she hasn't done that before either. She is going to ask the accountant who she works with but I'd thought I'd ask the fellow contractors on this forum for their experiences also

[TheCyclingProgrammer]

I guess if shes an accountant she will be comfortable having two very different trades under the same VAT? Dunno if that's an issue or not.

The FRS does allow for trade that covers different sectors. IIRC you need to evaluate on a per VAT period basis which sector the majority of your income came from and use that percentage.

[TheCyclingProgrammer]

I thought all were going up to 16.5% ? That's the impression I got from reading this article https://www.gov.uk/government/public...technical-note

For many of us this will be the case but there will be exceptions.

[TheCyclingProgrammer]

I make about £600 per VAT quarter at the minute as I'm on 13.5% but when it changes I'll only make about £35 per quarter which hardly seems worth it.

Also for me I have two cars on business lease which I currently can't claim any VAT on and if I make the switch to standard VAT I can reclaim 50% of that per car so it seems to benefit to me switch.

Don't think that because you've been on the FRS you haven't been able to recover the input VAT on your leases - that's what the surplus income on the FRS is designed to cover. If your quarterly input VAT has been exceeding what you've been making in FRS surplus, you should have considered moving on to the standard scheme sooner.