Surely it's not the action but the thing being manufactured which would dictate the flat rate scheme percentage.
Also does the business have only one definition or multiple?
Much more detail is needed as to what the business does and what it produces in order to help.
kind regards,
Shaun.
p.s. It will be somewhere between 9.0 and 10.5 dependant upon your answer.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
You need to read the Harris case (and save it away as this may be argued by HMRC) but your guy is an engineer, he does not from your description appear to be production line manufacturing which is what machining would tend to indicate.
HMRC want to categorise all engineers as people who build bridges (FRS 14.5%) but thats simply not the case.
In the Harris case he argiued (and won) that as there was no category that fitted so he used the any other category flat rate of 12%.
As this one is contentious and involves a case going against HMRC it may be better having a word with a tax specialist.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I did wonder if that sic code is actually correct for the nature of the business? Only cos the list I have states its 'excluding the aircraft industry' - although my info might be wrong.
Plus the certified and airworthy engineer description in the aircraft industry does cover a very wide range of disciplines, including the mechanical engineer the article refers to, software analysts, general mechanics (like car mechanics!) plus a myriad of others - I know this as I come from a family of engineers, each very different and one of whom who had a couple of engineering disciplines and whom worked in the aircraft industry for many years.
I also understand that some Aircraft supplies are classed as zero rated, with rules as to the qualifying status of such and whilst many sub contractors supplies would be classed as standard rated, there are some that are also zero rated - I assume that the actual VAT status has been verified correctly, given Airbus dont merely produce new aircraft but will repair, maintain and modify?
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Hope you dont mind me asking - but are you comfortable in your own understanding of what the client does? If not be honest with him and get him to expand more and as Shaun says enlist the help of a tax specialist.
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
