Self employed

[Stanios]

Im actually registering for VAT voluntarily because I see it as inevetable at least registering now allows me to reclaim almost £4000 of vat ive spent on van and tools. Claiming back a hunderd pound or so every month on petrol is another bonus. The biggest downside to VAT as far as I can see is the accounting side or at least the cost of having it done by someone else

 

[mfgs]

Once you register you can claim back VAT from the previous 12 months as well. Registering from the start could be slightly detrimental as you instantly become 20% more expensive on your labour charge. Also almost every customer instantly wants to pay cash to avoid the VAT.

 

[Radioman]

Once you register you can claim back VAT from the previous 12 months as well. Registering from the start could be slightly detrimental as you instantly become 20% more expensive on your labour charge. Also almost every customer instantly wants to pay cash to avoid the VAT.

I agree with this. It's tempting to take cash but if you do I would recommend that you put some if not all through your bank. Mr HMRC is very aware that the plumbing industry can be cash in hand If you can demonstrate that you put cash through the account, you are covered in the event of an inspection. On that subject, if HMRC decides to inspect a self employed person or business, it's the person or business that has to pay for the insect ion even if you are cleared of owing any taxes. I was inspected 18 years ago as the result of a spiteful customer who lost county court claim falsely reporting accounting irregularities to the revenue involving VAT and business taxes. The revenue descended on my house on a Sunday and removed my computers and trading accounts. 3 months and many meetings later I was clear d of all wrong doing and presented with a bill for £8000. Fortunately we had taken out insurance to cover this with our accountants. The insurers then proceeded to recover their costs from the revenue and the customer.

 

[1Steven]

Thankyou all will keep book up to date.