[Ben wood]

Just trying to work this out
If I was to go vat registered and earn 100.000  a year do you pay vat for the whole 100.000
Or for the 23.000 that'd above the threshold. And am I right in thinking I could go o  the flat rate which is 10 percent. Havre I got this right .

[AJ]

I think the flat rate is at 12% and you would qualify. Under 150k turnover.
You charge vat on top of all your sales at 20% and pay 12% to the vat man.
Have a word with your accountant for exact figures

[JackieW]

As far as I know if you are VAT registered you have to charge VAT on everything you do. From £1 upwards.
You claim VAT back on your purchases etc.

So if you used to charge £10 to clean a house,
you would now need to charge £12.
And then claim back the VAT on your running costs.

The extra £2 that you have charged the customer has to go to Customs and Excise minus
the VAT you can claim back for allowable expenses.

You don't get paid by the government to collect this tax for them unfortunately.

[AJ]

That is correct JackieW, but that is on standard VAT. Flat rate allows you to charge the same %age but pay 12% to HMRC. This takes into account the VAT you have paid out, making it a much simpler calculation. Flat rate can be easliy calculated yourself and submiited online, whereas standard rate would be advisable to use an accountant.

[George P]

That is correct JackieW, but that is on standard VAT. Flat rate allows you to charge the same %age but pay 12% to HMRC. This takes into account the VAT you have paid out, making it a much simpler calculation. Flat rate can be easliy calculated yourself and submiited online, whereas standard rate would be advisable to use an accountant.

standard rate is not that difficult to do once youve done it a few times, just have to see which is best for your business, takes me around 4 hours a quarter to do all vat return, i get this back with the fuel vat i get back,