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Where Taxpayers and Advisers Meet

How VAT affects sole-trader turnover/expenses in SA?

Womble7
Posts:5
Joined:Wed Jan 13, 2021 11:47 am
How VAT affects sole-trader turnover/expenses in SA?

Postby Womble7 » Wed Jan 20, 2021 4:56 pm

I am a sole trader who has recently registered for VAT (having hit the £85k threshold). I plan to claim back the VAT on my business expenses.

Having claimed back this VAT, then in my self assessment calc (of taxable profit) do I only deduct the net (of VAT) amount for expenses - or can I still offset the VAT-inclusive figure?

Similarly, do I use the ex-VAT or inc-VAT figure for my business turnover in self assessement?

Is the position different for any of this if I am in the Flat Rate Scheme for VAT (or any of the other VAT simplification-type schemes)?

les35
Posts:596
Joined:Wed Aug 06, 2008 3:09 pm

Re: How VAT affects sole-trader turnover/expenses in SA?

Postby les35 » Thu Jan 21, 2021 9:51 am

For non-FRS businesses, you use net figures for your SATR.
For FRS businesses, this is the HMRC guidance you need: www.gov.uk/hmrc-internal-manuals/business-income-manual/bim31585


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