Two businesses - is registration necessary?

drjohngreeves · Postby **drjohngreeves** » Mon Feb 07, 2005 6:27 am

I run one business which is below the VAT limit and therefore not registered. I am thinking of buying another ( different type of business ) also not registered . Do I have to add the two turnovers together to decide if I should now be registered, or are both businesses still considered seperately?

jamesconstantine · Postby **jamesconstantine** » Mon Feb 07, 2005 8:20 am

Hi

as it is you personally that will be making taxable supplies, the vat regulations state that turnover is aggregated for the purpose of vat registration.

This is a risky area and if you want to avoid registration there are certain steps that you could take to prove that the two businesses are independent from one another for genuinely commercial reasons and not for tax avoidance.

Hope it helps
James constantine FCCA
Chartered Certified Accountant
http://www.taxadviceuk.com
Weekly Tax Tips in understandable language

Instinctive · Postby **Instinctive** » Mon Feb 07, 2005 1:19 pm

I could be mistaken but I had thought that all businesses under the same entity would be aggregated regardless of operating completely independently from one another for genuinely commercial reasons and without any tax avoidance intention.

I also thought that it is only where two or more businesses were carried on in different names, eg, one in husbands name and one in wife's name, that the VAT office may consider making directions to aggregate the two turnovers, and it is in this circumstances that one may need to consider the final paragraph of James' letter.

Ramnik
ramnikrp@hotmail

jamesconstantine · Postby **jamesconstantine** » Tue Feb 08, 2005 2:50 am

You were not mistaken and you actually thought right and I agree with you. As a matter of fact the steps I meant include having the second business registered in someone elses' name if possible. I do not believe or have implied that I have suggested in any way that can avoid registration if same person makes taxable supplies. I think we should be more careful reading other members' words and it's best if we limit ourselves to whatever we have to say about a question. After all the webmaster guidance talks about offering initial guidance (as opposed to giving away the compplete solution online) so as to generate more interest.

James Constantine FCCA