[Crystal-clear]

Last week was our best ever week for turnover £17,025.00 as a few guys worked the sat to boost our numbers. Im loving this business right now. Its amazing what can be done if you want it enough.  Its fun for me to remember the first year up my ladder doing £100 a day.

I have fianlly settled on what our final goal will be. I thought about opening a second base or adding loads more to the current one. But that just feels like pushing on like mad forever. In the end I have decided to buy 2 more vans in the spring with a goal of 12 on the road and a spare in the yard. This way we max out everything we have, no need for another static system and lots more expenses ect. That will be a nice size to be and will get us the £million a year turnover or just about. Plan now is to save as much as possible in order to re invest again next year from April. We did that this year and added 2 more vans and 1500 customers so far. We still have a trickle of about 30 new a week right now

Lee i absolutely love you're posts. they're just keep me in check every time you get that "what the hell am i doing" thing going in your mind

I had lately been down a little didn't really push myself much for a while your posts helped motivated me and i'm proud to say been out and over 3 months picked up 80 new Gocardless customers 40 who pay on invoice and a few casual one offs.

i don't know why we had a couple of moody people about your posts i don't see it as showing off at all its really kind of you just reminding everyone you can make it you've worked hard for it for years and years i remember just 5 years ago or so you were the first to really push on jogpost big numbers back then too.

every time i read you're posts i have a smile on my face picks me up and makes me forget about that non payer or messer and reminds me that it does work and you can turn this into a more serious business. i mean i know it works lm fortunate enough to have home etc all from work! but yeah keep us all updated .

perhaps a sneak idea of your new method alongside leafleting soon 

[Lee Pryor]

Im glad you like the updates. What I write isn't for everyone and I get that. The funny thing is I often feel just like you and everyone else does, down, de motivated, tired, fed up and so on.  Having people appreciate the updates helps keep me motivated and focused. I also enjoy reading other people success stories on here. Doesn't matter the size they are I like to see people do well and move forward.

[Crystal-clear]

keep them coming and you're spot on!! we need these updates to keep sane
lee may i ask.
of course you're vat registered but youre over the 150k flat rate thing so do you need to pay 20% vat now ? what im getting at is a 3 bed semi you only charge £15 that's £12 turn over before your costs to clean it just wondered you're profit might be around £6.00 the 15 feels a little cheap if you do indeed collect £3 VAT for surrey areas for a vat reg company would charge 20 + even working alone too pretty much standard if i was to hit vat i would also want to charge more to cover the vat.just amazed at how that works im guessing large numbers its fine...

oh and you know when you get 30 40 50 gocardless customers in the day what ratio do you find that cancels the mandate just after the first clean or even before the payment clears?  i know it defo happens because on a small scale i just got one the other day who canceled after 1 clean stating she only wanted a one off and ofc over the years ive had another here and there.i'm sure you get that too mine was around a 50/1 ratio but its put me off from getting to go on gocardless from the first clean i know its only one but i want to reduce stress lol whats your experience i'm quite keen to know how many mess you about on gocardless cancels and how you deal with it! cos there will always be the odd one that only wants a one off and knows he can cancel the mandate anytime hence get a cheap regualr clean quote when they should have paid a bit more for a one off.

[Lee Pryor]

Yes we are way way past the flat rate of VAT. You are forgetting to account for claim backs. You will never actually pay 20% because there will always be vatable expenses on what you have spent. For example with our last VAT quarter our turnover for that period was £179,550.00 so 20% of that would be £35.910.00 but our actual vat bill was £13,550.00 so not even 10% of turnover. This is an extream example as we spent a masive amount on marketting in that period. On a normal spend quarter I would expect our vat bill to be about 14% not only that we make our money on a volume business model. So it doesnt matter if we make £6 on a £15 job if we are doing hundeds every day

Harder to answer your other questions. As I have told you in the past we get messed around just like everyone else on here does. We try to have processes in place to minimise these problems and deal with if they pop up. What else can I say.

[Crystal-clear]

Yes we are way way past the flat rate of VAT. You are forgetting to account for claim backs. You will never actually pay 20% because there will always be vatable expenses on what you have spent. For example with our last VAT quarter our turnover for that period was £179,550.00 so 20% of that would be £35.910.00 but our actual vat bill was £13,550.00 so not even 10% of turnover. This is an extream example as we spent a masive amount on marketting in that period. On a normal spend quarter I would expect our vat bill to be about 14% not only that we make our money on a volume business model. So it doesnt matter if we make £6 on a £15 job if we are doing hundeds every day

Harder to answer your other questions. As I have told you in the past we get messed around just like everyone else on here does. We try to have processes in place to minimise these problems and deal with if they pop up. What else can I say.

Thx lee! yer alot of us are fearful of hitting vat so your logic here does really help and put it in perspective:)

[Perfect Windows]

No need to be fearful of the VAT limit. You just need a plan to add £11,000 to your turnover as quickly as you possibly can. If it's planned and prepared for, you'll be fine. If you're turning over £85,000 then a concerted effort over a well-planned summer should be able to get you there. So go from £85,000 no VAT to £96,000 with 11% flat rate VAT nets you £85,440

Interesting graph here from when the VAT limit was £81,000 of how many businesses hover below the threshold. Shows what a distorting tax VAT can be.

https://goo.gl/images/Gdtwzx

Vin

[Crystal-clear]

No need to be fearful of the VAT limit. You just need a plan to add £11,000 to your turnover as quickly as you possibly can. If it's planned and prepared for, you'll be fine. If you're turning over £85,000 then a concerted effort over a well-planned summer should be able to get you there. So go from £85,000 no VAT to £96,000 with 11% flat rate VAT nets you £85,440

Interesting graph here from when the VAT limit was £81,000 of how many businesses hover below the threshold. Shows what a distorting tax VAT can be.

https://goo.gl/images/Gdtwzx

Vin

personally if the time came for Vat at around 10k under i would register and up all the price's by at least 20% so a £20 property becomes £24  £10 front £12 and so on.
thoughts on that? i personally feel if you explain thanks to your custom we now have to pay VAT i have a feeling it wont go to catastrophic prob some cancellations.
in turn any new work when coming nearer work will have to be priced up inc vat so no more £20 house quotes it'll be £24
basically everything will have to go up by 20% although if its the flat rate selected 13% or whatever it is £22.60
you would need to just quote remembering a certain % isnt youres so yeah + vat in your mind.

[John Mart]

There’s again talk of all businesses over £42,000 having to go VAT registered in the budget. That would  be welcome. However the sensible thing is all self employed paying VAT from 0. It would level the playing field in many industries and raise billions.

The question is, will Lee be happy to stop there? I’m 55 and my original goal was 3/4 vans, but I’ve changed that to 5/6 at the rate of 1.5  a year.

[Perfect Windows]

personally if the time came for Vat at around 10k under i would register and up all the price's by at least 20% so a £20 property becomes £24  £10 front £12 and so on.
thoughts on that? i personally feel if you explain thanks to your custom we now have to pay VAT i have a feeling it wont go to catastrophic prob some cancellations.
in turn any new work when coming nearer work will have to be priced up inc vat so no more £20 house quotes it'll be £24
basically everything will have to go up by 20% although if its the flat rate selected 13% or whatever it is £22.60
you would need to just quote remembering a certain % isnt youres so yeah + vat in your mind.

When we got there I considered telling customers we'd hit the limit and bunging 10% on, saying we'd swallow the rest.  Given that our flat rate would have been 11% for the first year it would have pretty much covered us.  In the end we just took the hit and ran our normal inflation price increases for the customers who were due one.

If you're happy to stay below the limit do so. If you're trying to get past it, just go through the limit at as fast a sprint as you can manage, accept it as a cost of doing business, forget it and ignore any idiot who has a go at you for choosing to become a tax-collector for the government.

Vin

[Perfect Windows]

There’s again talk of all businesses over £42,000 having to go VAT registered in the budget. That would  be welcome. However the sensible thing is all self employed paying VAT from 0. It would level the playing field in many industries and raise billions.

The question is, will Lee be happy to stop there? I’m 55 and my original goal was 3/4 vans, but I’ve changed that to 5/6 at the rate of 1.5  a year.

One way it might make sense would be if from, say, 0-8k flat rate was 1%; 9-16k, 2%; 17-24K, 3%; etc.  The result would be that there wasn't a single point where the jump stopped people going through that threshold; the pain would be spread over a long time.  It'd also have to be phased in over several years to stop it penalising people suddenly.

It'd take a brave government to do it, of course; there'd be a spike in inflation.

Vin

[Simon Trapani]

Your updates are inspirational Lee.

[Stoots]

I think there's talk of phasing in vat in future, like vin  said 1%, 2% etc

This would make far more sense than lowering it, a lot will just drop there turnover/stop operating  or do more dodgy cash  in hand type transactions. and the economy will suffer.

If they phase it in gradually a lot will push on and grow

At the moment it's a brick wall.

[Dry Clean]

I think there's talk of phasing in vat in future, like vin  said 1%, 2% etc

This would make far more sense than lowering it, a lot will just drop there turnover/stop operating  or do more dodgy cash  in hand type transactions. and the economy will suffer.

If they phase it in gradually a lot will push on and grow

At the moment it's a brick wall.

The vat threshold is there to make it fairer for the guys who don't have enough expenditure to claim any of it back, its a brick wall if you only plan to go a few grand above it, if you want to grow well past the threshold then as Lee explained its nothing to worry about.

[Lee Pryor]

There’s again talk of all businesses over £42,000 having to go VAT registered in the budget. That would  be welcome. However the sensible thing is all self employed paying VAT from 0. It would level the playing field in many industries and raise billions.

The question is, will Lee be happy to stop there? I’m 55 and my original goal was 3/4 vans, but I’ve changed that to 5/6 at the rate of 1.5  a year.

I can say without doubt that I will be stopping there. I want to. Theres other things I want to do in life and in business. We will never turn business away or say we are full. If things grow by themselves and 2 years down the line we could justify another van then I will buy it. After my goal of 12 I will not be spending £100k a year growth and working myself into the ground anymore. My only goal at that point with it will be to maintain that size each year and be off somewhere else enjoying myself or working on other projects, like property ect.

[Tom-01]

There’s again talk of all businesses over £42,000 having to go VAT registered in the budget. That would  be welcome. However the sensible thing is all self employed paying VAT from 0. It would level the playing field in many industries and raise billions.

The question is, will Lee be happy to stop there? I’m 55 and my original goal was 3/4 vans, but I’ve changed that to 5/6 at the rate of 1.5  a year.

I can say without doubt that I will be stopping there. I want to. Theres other things I want to do in life and in business. We will never turn business away or say we are full. If things grow by themselves and 2 years down the line we could justify another van then I will buy it. After my goal of 12 I will not be spending £100k a year growth and working myself into the ground anymore. My only goal at that point with it will be to maintain that size each year and be off somewhere else enjoying myself or working on other projects, like property ect.

That sounds like a good plan. To have all the processes in place to earn a decent living without being tied to it and being able look at other things is a good idea IMO. It must have been a lot of hard work over the last few years. To have a couple of excellent revenue streams is the way to go.

[Stoots]

I think there's talk of phasing in vat in future, like vin  said 1%, 2% etc

This would make far more sense than lowering it, a lot will just drop there turnover/stop operating  or do more dodgy cash  in hand type transactions. and the economy will suffer.

If they phase it in gradually a lot will push on and grow

At the moment it's a brick wall.

The vat threshold is there to make it fairer for the guys who don't have enough expenditure to claim any of it back, its a brick wall if you only plan to go a few grand above it, if you want to grow well past the threshold then as Lee explained its nothing to worry about.

It's nothing to worry about when you are well past it but unless you have a lot of marketing budget behind you to quickly smash through it then it's going to effect you for a few years once you get to 90,95,100k so and so forth.

Yes once you get well beyond it becomes easier but most won't be able to grow at a rate quick enough to not feel it.

It's still a brick wall as soon as you go over there's 20% in your face.

Most business to customer type business will struggle to offset large amounts of vat.

If it was phased in gradually on a sliding scale based on turnover it would mean more of us could grow at a manageable rate with less street than having to go balls out for a few years to get over the hump

Something needs to be done with the threshold as it puts too many off and for good reason.

[Perfect Windows]

I think there's talk of phasing in vat in future, like vin  said 1%, 2% etc

This would make far more sense than lowering it, a lot will just drop there turnover/stop operating  or do more dodgy cash  in hand type transactions. and the economy will suffer.

If they phase it in gradually a lot will push on and grow

At the moment it's a brick wall.

The vat threshold is there to make it fairer for the guys who don't have enough expenditure to claim any of it back, its a brick wall if you only plan to go a few grand above it, if you want to grow well past the threshold then as Lee explained its nothing to worry about.

As a proportion of turnover, a startup might well have bigger expenditures than an existing large business, so they'd have more to claim back rather than less.

The threshold was an incentive to help people to start new businesses - less admin, lower taxes and lower prices to consumers. The problem with the threshold is that if you turn over £84,999 you pay zero VAT and if you turn over £85,000 you pay £9,350 VAT (flat rate), so the market is grossly distorted and many traders sit just below the limit or do cash-in-hand work.

Flat rate VAT is simple to administrate, takes no notice of expenditures (except big bill items like new vans) and could easily be phased in as turnover grows.

As it happens, I'm not advocating it, just pointing out that the government's guessed-at policy to drop the limit to £42K will not solve the threshold's inherent problem; it'll just move it.

Vin

[NWH]

You are forgetting that when you go over an amount way below the VAT limit you’ll incur another 12% odd in income tax and National insurance,if you earn this before all well and good bit if your all of a sudden thinking big it will cost you more than 11k a year. Also unless your the size or similar of Lees business there’s only so much you can claim for,there’s only so many poles and resin etc you’ll need to buy  I’m not poo pooing it in any way I’m just saying that it will cost you a lot more going big than you think,you could be on your own and then all of a sudden be VAT registered with just 1 employee earning 150000 a year and be worse off than you was a few years previously. 1 employee VAT and 40% tax at that amount a lot of window cleaners doing well already would be worse off,fair play to you Lee I’d like to come over and have a chat with you 1 day soon it would be interesting to see how it works for you. Big investment is needed in any business getting to that level and 24hr commitment there ain’t many window cleaners with that kind of commitment as a lot of people who choose to do it do it for the lifestyle it can give you with the hours etc.