[mike1986]

I currently run my own window cleaning business and I also have 1 franchise set up. My turnover is currently just below the Vat threshold and I don’t wish to go above it. Would it be possible for my wife to buy a franchise from my company if it is run as a completely separate business? Obviously this would be a great way to increase the family income and it would mean my business still remaining below the vat threshold. It also would mean I have not deliberately split the business to avoid Vat as my company and my wife’s  franchise would be a completely separate business. Anybody done anything similar? It’s very hard to get any advice online. I asked my accountant and he isn’t sure either.

[Don Kee]

Ask your accountant

(But I get the feeling it’ll be a big “nope”.

[adman]

Hi, I run a franchised business.  The franchisor is a Ltd company and I'm a franchisee along with the others, paying royalties into the Ltd Co. We're all below the threshold, my accountant was quite happy with that

[Arnold Palmer]

If you're doing it to avoid paying Vat my advice would be:

1. Stop posting about it on a public forum
2. Ask a chartered accountant
3. Stop posting about it on a public forum

[mike1986]

If you're doing to avoid paying Vat my advice would be:

1. Stop posting about it on a public forum
2. Ask a chartered accountant
3. Stop posting about it on a public forum

Soupy. Thanks for your reply. Perhaps I am wrong but as far as I understand it, it is only unlawful if I deliberately SPLIT a business to avoid Vat. What I’m suggesting is that my wife starts her own franchise to start at a future date that she will run independently. Therefore the 2 business were never 1 business. As I mentioned before, my account doesn’t seem to know the answer and it’s a bit of a minefield as so many accountants give different advice 

[mike1986]

Hi, I run a franchised business.  The franchisor is a Ltd company and I'm a franchisee along with the others, paying royalties into the Ltd Co. We're all below the threshold, my accountant was quite happy with that

That’s interesting 🤔 thanks adman

[AuRavelling79]

I reckon that if your wife is using the same address then the taxman will enquire deeply when you submit accounts.

Ask the tax office. If you are hesitant to do so then it would seem you know the motive is not acceptable to Inland Revenue.

[NWH]

You aren’t allowed to have anything to do with that business I think the old Vat man might see you living with her as having something to do with it me thinks.

[Smudger]

will your wife do all the cleaning ? - where is the equipment coming from ? ( ie. she buying it/ same arrangement as the other franchise ) no shared equipment - office or otherwise

personally I think your treading a fine line - I would ask the VAT man ( they are very helpful ) you just may not get the answer you want but in the long run may save you thousands in fines etc..

Darran

[Richard iSparkle]

My guess is itd be fine so long you divorce her first and get separate homes

It would be far easier however just to pay VAT stop using so much energy and tricks to avoid it

I doubt having a completely separate business setup as a franchise will save you enough money to make it worthwhile at the amount you’re turning over

[Stoots]

What it will come down to is proving that you made the decision to do that based on sound business reasons and not to avoid VAT.

I'm sure you have a great answer for them 

[֍Winp®oClean֍]

I remember the days on here where people used to dream and aspire to become vat registered! When one man bands were doing two, three-hour days a week and were always 'just about' to hit the vat threshold so would seek advice in order to publicly announce it! Them were the days!!😁

[Perfect Windows]

Speak to your accountant and ask them to refer you to a VAT specialist. Those are deep waters you're jumping into. It's possible but you need to do it just right. It's so intricate that we didn't bother. One of the problems is that if you get even one detail wrong, the whole thing is wrong.

There's no point asking HMRC as they have a policy that they won't assess your plan to do anything complex before you start. They'll look once you're doing it. Their argument is that they aren't free consultants.

Vin

[Arnold Palmer]

Their argument is that they aren't free consultants.

Which is a horrendous attitude to take when you think about it.

[Mike Burd]

Their argument is that they aren't free consultants.

Which is a horrendous attitude to take when you think about it.

If it's really complicated though, I can see why they wouldn't want to waste taxpayer's money looking at presumably very many schemes people have come up with to assess whether they are legal or not. I'm guessing they'll answer simple questions?

[Arnold Palmer]

If it's really complicated though, I can see why they wouldn't want to waste taxpayer's money looking at presumably very many schemes people have come up with to assess whether they are legal or not. I'm guessing they'll answer simple questions?

So they won't tell you how to do it right but they will punish you for doing it wrong?

[Mike Burd]

If it's really complicated though, I can see why they wouldn't want to waste taxpayer's money looking at presumably very many schemes people have come up with to assess whether they are legal or not. I'm guessing they'll answer simple questions?

So they won't tell you how to do it right but they will punish you for doing it wrong?

I expect it's a cost/resources issue.

[AuRavelling79]

I have a separate business running from my home address - it is not window cleaning related and when I was setting it up the Inland Revenue were very helpful as to whether there was any conflict of interest.

However as I asked more complex questions, while helpful in attitude the chap at the other end said I should consult a third party for professional advice.

[Perfect Windows]

Their argument is that they aren't free consultants.

Which is a horrendous attitude to take when you think about it.

I guess it makes sense. What happens if my ideal tax reduction solution resembles the Double Irish with a Dutch Sandwich? (a real thing https://www.investopedia.com/terms/d/double-irish-with-a-dutch-sandwich.asp)

Should taxpayer money be used to assess a deeply complex tax accounting scheme and tell me whether I'm going to get away with it? I'd argue not.

Vin

[Frankybadboy]

I have a separate business running from my home address -  .

didnt you get done for that and your red light bulb taken away