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Should you register for VAT is your turnover is less than £85K?

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    #11
    Originally posted by Maslins View Post
    Unsure how you got to these numbers, but I think it's far worse than that.

    Assuming limited cost trader, and let's give benefit of first year 1% discount, it'd be £90 vs 15.5% of £540 = £83.70. So £6.30/day.

    Without first year 1% discount, it's £90 vs 16.5% of £540 = £89.10. So literally just 90p/day.

    Once out of the first year, from a financial perspective FRS virtually never works out better. Some people still prefer it as it means they don't have to worry about whether VAT was charged on that £3 sandwich/whatever.
    Apologies, yes you are right, I forgot that for FRS you apply the VAT percent on total income. Also I used 14.5% for FRS as indicated by the OP.

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      #12
      Originally posted by northernladuk View Post
      It is? With FA it's so simple I haven't even had to put enough through in to it to notice it's a PITA... erm.. if that makes sense.
      I may be biased. I've had several years of VAT hassles and end-of-year, correcting payments. That may change now that I'm using FA, but I've still to go through a full year with this service.
      ---

      Former member of IPSE.


      ---
      Many a mickle makes a muckle.

      ---

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        #13
        Originally posted by vwdan View Post
        There's only a couple of reasons to avoid VAT:
        • Avoid extra hassle and paperwork (This is frankly minimal if you have a proper accountancy service)
        • If most of your trade is to other non-VAT registered customers
        • I suppose if you really have, literally, no VAT-reclaimable expenses


        Most contractors have accountants who will deal with VAT with minimum fuss, deal predominantly B2B and will incur at least some expenses.

        I've never bothered with Flat Rate, so I won't comment on that specifically but getting VAT registered is a no brainer IMHO.
        "getting VAT registered is a no brainer IMHO"

        would registering for VAT when the turnover is less than the thresh hold, then have MTD implications?

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          #14
          Originally posted by siphr View Post
          Apologies, yes you are right, I forgot that for FRS you apply the VAT percent on total income. Also I used 14.5% for FRS as indicated by the OP.
          Have you checked you aren't caught by the Limited Cost trader rules? Most IT contractors will be, which means you percentage will be 16.5% (15.5% in the first year).

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            #15
            Originally posted by JohntheBike View Post
            "getting VAT registered is a no brainer IMHO"

            would registering for VAT when the turnover is less than the thresh hold, then have MTD implications?
            Why do you think it would?
            'CUK forum personality of 2011 - Winner - Yes really!!!!

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              #16
              Originally posted by TheCyclingProgrammer View Post
              Have you checked you aren't caught by the Limited Cost trader rules? Most IT contractors will be, which means you percentage will be 16.5% (15.5% in the first year).
              Did you mean the OP? I am not on FRS. I think the OP is considering FRS if at all.

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                #17
                Originally posted by siphr View Post
                Did you mean the OP? I am not on FRS. I think the OP is considering FRS if at all.
                Yes, sorry, I thought you were the OP.

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                  #18
                  Originally posted by northernladuk View Post
                  Why do you think it would?
                  HMRC's skullduggery?

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