[waynebarry]

I need to go V.A.T registered but I have a large chunk of domestic work in my turnover. Are you V.A.T registered and also have domestic work & how do you get round this?
I am thinking of going sole trader with a new company name for the domestic & putting my currant business V.A.T registered, what do you think?

[Pristine Clean]

It has its benefits. But if your turnover is not at the threshhold of £68,000 then there is no need to go VAT registered. And not much point either.

And yes we are VAT Registered and you have to pay VAT every 3 months and cannot be late with payment or you get a slap. If you continue to be late you removed. Not that I know the procedure for being removed.

Domestic work will increase in price to you customers but not to commercial who are VAT registered as they can claim it back.

Theres no way in getting round it. I would not suggest cash in hand, seems a bit risky.
Dave

[Moderator David@stives]

Wayne

Just grit your teeth, put up who you have to, and the rest will come together, you will look back in 12 months and wonder what you were worried about.

Why have the added hassle of splitting out your domestics, not as easy you think, if you are paying the vat on it your not paying the tax.

The plus side you can claim back the vat on items bought.

[waynebarry]

Hi David - I dont understand when you say if I pay vat on the domestic work I wont pay tax?

[Moderator David@stives]

Sorry not good at explaining, if you dont pass the vat on then your income is reduced by the vat you have to pay, you pay tax on the rest.

[Clive McDonald]

Or, whatever vat you pay you would have had to pay 20% of it as tax anyway, so effectively you only pay 80%.

[Andy@w.c.s]

I think there is a rule that ,
if you split your business, say domestic  and commercial and it is the same type of work it is classed in the eyes of the revenue as the same business and you may be liable for the vat due on your domestic round if its only your commercial work that is vat registered

not 100% sure but check it out as five years on it could cost you


Andy 

[Andy Foster]

I think there is a rule that ,
if you split your business, say domestic  and commercial and it is the same type of work it is classed in the eyes of the revenue as the same business and you may be liable for the vat due on your domestic round if its only your commercial work that is vat registered

not 100% sure but check it out as five years on it could cost you


Andy 

Absolutely correct, also if they deem you to be doing it to try and avoid the VAT then you will be on their radar and may expect an investigation pretty soon!!!

[daz1977]

u can not split ur business and just do commercial with the vat, if the vat man finds out and thinks u r coning him,  customs and exercise are not the type of people u want to annoy, they can come to ur business and claim everything they have more power than the inland revenue,  a lot of things got moved around and different dept where given a lot of power,  when they raid you they only have the police there so you dont run off,  my aunt was raided by them and they know everything that was goign in and out of her banks for years

also if you have to claim vat back, u have to pay them the vat u owe them before they will pay you

[Moderator David@stives]

Yes you can run a vat and a none vat business.

I have actually picked up the phone and phoned the revenue.

Before you embark down that road I suggest you do the same.

[daz1977]

i thought if they where the same type of business u couldnt do that as they are two close,  but if its a wc business and a car sales then it is ok

[daz1977]

have a look at this it might explain what u r after

http://www.hmrc.gov.uk/vat/start/register/when-to-register.htm#7

[Moderator David@stives]

No even if its both window cleaning.

one business could be a vatable business selling to commercial the other a none vatable domestic business.

But my advice would be to phone the tax man for your own personal circumstances.

the only trouble occurs when you have to charge expenses from one business to the other, ie how do you split expenses between the 2 businesses.

For me its too much bother, i just concentrate on growing and not penny pinching too make a couple of quid.

[markbonham]

The only way around this to avoid going VAT registered is to turn the business into a Limited company. i.e. you can have 10 different named limited businesses each turning over 68k a year and not have to pay vat. If you have 10 different named businesses that are not limited companies, the inland revenue just total all the turnover in all business and that is what yu pay vat on. Basically being a sole trader or partnerships its you that is responsible and your name on the business, where as a limited business, its not you its the limited company seperate from you, therefore if yu have 10 limited companies its legal to do that withn them all being under the vat threshold.

[formb]

If you are going to set up a LTD company what you need to do is get the flat rate VAT.

Its what I did saved me £1000s.