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harryspotter


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Interesting VAT question
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Hello everyone, I have this problem.  I am setting up an estate agency, I also own a mortgage advice practice so the two will work together quite well I hope!!

Before I put the 2 options to you I want to mention that when I sell a house the agency fee is Vatable, when I give mortgage advice and charge a fee it is not vatable.

What I would like to do is offer new clients 2 packages

1.  Sell your home only package £999 plus VAT

2.  Sell your home and mortgage advice package £999 only.

The packages broken down are

1.  Estate agency fee which is vatable

2.  Estate agency and mortgage advice, the fee in this instance is for mortgage advice which isn't vatable and we sell the house for free.

Hope this makes sense.

Can I do this?

Thanks

MArk



-- Edited by harryspotter on Wednesday 15th of December 2010 12:52:55 PM

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BudgetB


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Yes, I guess so. Although could this be seen as a way of avoiding VAT? I guess it depends what people have to do to qualify for the free house sale, do they just have to take some mortgage advice, or do you have to actually arrange the mortgage?

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Jenny

 

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Merlion ABS


Senior Member

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Quick Question,

Is your Mortgage Advice Practice going to be a separate legal entity from the estate agent?

Or are you going to be the running the businesses together ie adding the accounts together and paying tax on one taxable profit figure?

To be honest I wouldn't try the route of option 2 because if this was allowable then every estate agent would be doing it.

I would recommend you speak to a tax and VAT specialist as I'm sure there is a common solution to your problem.





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