Flat Rate: Cant I claim VAT on purchases.

[Goodmans]

Hello there,

I am on Flat rate (12%). My accountant says that I cant claim the VAT if i purchase any Computer etc because I am on Flat Rate. Is it true?.
Where can I find these rules for flat rate?

Please help.

Regards
Goodmans

[Bagpuss]

IIRC you can opt out for certain large purchases, something like >2k

PS what industry are you registered for at 12%? I seem to remember I'm 13%, but you could be getting the 1% new start up discount

[Goodmans]

Thanks mate.

Thanks for speed reply.
Type of business is IT Services, Yes its new company and i am in 1st year so I got 1% off.

Yaa just now i was reading a point in flat rate VAT scheme.

If capital assets are purchased with a VAT inclusive value of £2,000 or more, the VAT can be recovered in the normal way. This concession, however, cannot be used where the assets were:
* acquired for resale, or for incorporation in goods to be sold,
* acquired to be hired out, leased or let,
* for consumption within one year, or
* covered by the capital goods scheme.


Cheers,
Goodmans

[NickFitz]

Where can I find these rules for flat rate?

HMRC's Flat Rate Scheme Guidance manual, if you can stand to plough through it

UPDATE: The page you want, probably.

[Goodmans]

Thanks a lot guys.

It really helped.

Goodmans.

[DaveB]

For capital purchases under £2000 you cannot claim back the VAT if you are on the FRS. If the purchase is over £2000 you can but it has to be a capital purchase e.g. hardware. Training, services etc etc doesn't count IIRC.

[oraclesmith]

Goodmans - it looks like you need to find yourself a better accountant. This is basic stuff.

[NickFitz]

I'm sorry, but why all the advice based on "IIRC"?

The manual is online, refer to that. No need to RC anything if you can go to the source.

[Sockpuppet]

Goodmans - it looks like you need to find yourself a better accountant. This is basic stuff.

Why? At the moment it looks like the accountant is correct.

[malvolio]

Why? At the moment it looks like the accountant is correct.

Yep, agreed. This is yet another case of someone not bothering to do their homework...