Hello
I've looked for this question on the forum but cannot find it, but apologies if it is here somewhere!
Basically, I have a limited company that provides financial consultancy services. The turnover (invoices for services) is just tipping over the VAT limit now, but is likely to hover around £85K to £90K in the foreseeable future.
I cannot increase the price of my services by 20% for VAT as that would make me uncompetitive, plus I have a lot of existing clients on a fixed fee without VAT contract. So, if I have to register for VAT, it will effectively lower the income to the business by about 13% (on the flat rate scheme) as I will just have to charge a lower fee before adding VAT to it and swallow the cost myself rather than passing it on.
So in future, rather than invoices over 12 months totalling £85K to £90K they will total around £75K plus VAT. Does this mean I will have effectively dropped below the VAT threshold again? I'm confused by this, as without VAT I am above the threshold but once I add it on to my lower fee, I seem to drop below again? Am I looking at this the wrong way? I don't want to get into a cycle of registering and de-registering!
Many thanks indeed if anyone can explain what I should/have to do?
- Home
-
Tax News
- Budgets and Autumn Statements
- Income Tax
- Business Tax
- PAYE and Payroll Taxes, National Insurance, NICs
- Company Taxation
- Savings & Investments, Pensions & Retirement
- Capital Gains Tax, CGT
- Property Taxation
- Inheritance Tax, IHT, Trusts & Estates, Capital Taxes
- Tax Investigations & Enquiries
- VAT & Excise Duties
- Stamp Duty, Stamp Duty Land Tax, SDLT
- International Tax
- HMRC Administration, Practice and Methods
- Professionals in Practice & Industry
- General
- TaxationWeb
-
Tax Articles
- Budgets and Autumn Statements
- Income Tax
- Business Tax
- PAYE and Payroll Taxes, National Insurance, NICs
- Company Taxation
- Savings and Investments, Pensions and Retirement
- Capital Gains Tax, CGT
- Property Taxation
- Inheritance Tax, IHT, Trusts & Estates, Capital Taxes
- Tax Investigations & Enquiries
- VAT & Excise Duties
- Stamp Duty, Stamp Duty Land Tax, SDLT
- International Tax
- HMRC Administration, Practice & Methods
- Professionals in Practice & Industry
- General
- Tax Tips
-
Tax Forum
- Income Tax
- Business Tax
- PAYE and Payroll Taxes, National Insurance, NICs
- Company Taxation
- Savings & Investments, Pensions & Retirement
- Capital Gains Tax, CGT
- Property Taxation
- Inheritance Tax, IHT, Trusts & Estates, Capital Taxes
- Tax Investigations and Enquiries
- VAT & Excise Duties
- Stamp Duty, Stamp Duty Land Tax, SDLT
- International Tax
- HMRC Administration, Practices & Methods
- Professionals in Practice & Industry
- General
- Tax Jobs
- Get in Touch