Hi I am new to the forum, but wondered if someone could help. Just got my first client a public house done no book-keeping new business started in April 2009.
My question is they should be registered for VAT. I think it would be easier for them to be on the flat rate scheme, but from which date should i start to calculate what they owe. When will the registration have to date back to?
It all depends on the turnover of the business. The current threshold is £70,000, so if the turnover is more than this, they need to be VAT registered. The flat rate scheme is for turnover less than £150k so could be ideal.
The rate for pubs is 6% of total turnover and you do not claim any purchase VAT. It can be very beneficial.
Hi Thanks for replying i was aware of the rates and things. It was at what point do i start to work out what they owe. Would it be the from the point they reached £70,000
I believe you will be liable for VAT from the date of registration. Your registration date will be decided depending on if you are already over the treshold or you expect to go over.Once you reach the treshold you have 30 days to register if you miss this they might make you pay a penalty (might not). You can ask for backdating your registration voluntarily ( something like up to 4 years) for the purpose of recovery of earlier input tax (ok if it is a new business than this not make much sense-maybe the first few months). If your client took over an ongoing concern than it is a bit different rules and you will have to be very careful what you do.
I am not 100% sure in the above but it is to my best knowledge, hopefully others can confirm or disagree, but if you want to make sure you really should talk to HMRC.
-- Edited by attilabenko on Thursday 10th of June 2010 06:58:04 PM
