I have just started doing the books for my husbands new plumbing business and stuggling with how to deal with parts bought for a job. The suppliers charge my husband vat on the parts he bought for the job but how then do I invoice the customer? Do I invoice for the gross total of parts or the net value? Hope this makes some sense. The business is not VAT registered.
As you are not VAT registered, all your supplies will cost you the Gross amount, so therefore your markup will be based on that figure and not the net. But be careful not to price yourself too high to your customers because of it! Or if you are invoicing them at cost rather than making a profit on the parts, it will be the gross figure.
Hope this makes some sense. The business is not VAT registered.
