Is it worth breaching the VAT threshold

[jtufty]

Hi,

My trailing 12 month turnover is bobbing around the £88k mark. If I wanted, I could probably get more work in and increase it to £95k.

But is it worth going VAT? I have hardly any expenses to claim, so from that point of view its not worth it. Is it onerous to become vat registered and maintain the HMRC requirements? How much would accountancy fees likely increase? (ballpark).

Im just weighing-up the pros/cons of becoming vat registered. For example, theres little point being vat registered for £95k turnover if my accountancy fees shoot-up to £4kpa.

Thanks

[pawncob]

As has been said before in answer to your previous posts, it's up to you.
Accountancy fees, assuming you keep your own records and submit VAT returns, shouldn't increase at all.

[Trevor S]

Well spotted @pawncob - I hadn't thought of looking back at previous threads before!

@jtufty - last September, you thought you might breach the (then) £85k threshold due to a specific job which had two months left to run, and said that a typical annual turnover was around £70k. But now you see potential to maybe increase it to £95k.

VAT threshold changes aren't as "predictable" as they once were! Some people favour a steady increase, others believe the threshold should be decreased considerably, to avoid the "cliff-edge". There's no guarantee that it will remain viable in the future to operate at just below the threshold. You've mentioned most of your customers are VAT registered, and could recover any VAT you charged them. So it might be worth registering and allowing your business to continue to grow well beyond the threshold - rather than trying to keep it capped just below. In time, increased profits might far outweigh any increased costs.

[jtufty]

Ah! Fantastic. Apologies, I thought I had posted a similar question on here before but I couldnt find it. (Ive just found all my previous posts under in the 'User Control Panel')

Thankyou. I will speak with a vat accountant and ask what the likely fees will be. I suspect youre right: register for VAT and then I dont have to worry each month about breaching the limit. Or... I may start reducing workload to enjoy a better life/work balance! Its a nice problem to have.

Cheers!