I have a client who is a self-employed fisherman. He is VAT registered for this business. However during the off season he's doing some building work for his brother. My client has registered as a subcontractor with HMRC.
My question is: because my client is VAT registered for the fishing business, can he treat the subcontract building work as a seperate trade and therefore not charge his brother VAT? He's happy to set up two different bank accounts and produce two sets of accounts etc. Or will the VAT registration catch all income streams regardless of what he's doing?
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Stuart
Birmingham City FC - Blues is my religion St Andrews is my church
My understanding is that it's the individual (in the case of sole traders) who is registered for VAT and must charge VAT on any work they do, if it's rated for VAT. The only difference is if he run one as a self employed person and the other as a separate legal entity like limited company. I'm not the best at explaining these things, so yes he charges vat on the building work too.
