Advice needed re chagring customers vat

superskintmouse

Hi, I am after some advice if anyone can help I would appreciate it. i haev recently become s'employed selling homemade crafts. i have rung hmrc and registered, and my books are in perfect order. My concern is should i be charging vat? I have just worked out how much my materials cost and factored in labour etc but i hadnt thought about vat. Im planning to have less than £5000 income per year so its only small scale. Help I am completely clueless and have spent the last two hours on the hmrc website!!!

Savvy_Sue

No, you are nowhere near needing to register for VAT, and you cannot charge VAT if you are not registered.

At that level of income from self employment, you could ask HMRC for a certificate of exemption from paying National Insurance too. However, you may need to check whether you are getting credits towards your pension elsewhere - if you are receiving Child Benefit then that also gives you Home Responsibilities Protection for some years.

superskintmouse

thanks Savvy sue, i thought it was something i didn't need to worry about. they are sending me the exemption form for Ni. Thanks again x

classy69

You only need to register for vat if your turnover exceeds £77,000 in a 12 month period, so from what you are saying you have a while to go yet!

Wywth

superskintmouse wrote: »

Hi, I am after some advice if anyone can help I would appreciate it. i haev recently become s'employed selling homemade crafts. i have rung hmrc and registered, and my books are in perfect order. My concern is should i be charging vat? I have just worked out how much my materials cost and factored in labour etc but i hadnt thought about vat. Im planning to have less than £5000 income per year so its only small scale. Help I am completely clueless and have spent the last two hours on the hmrc website!!!

Have you actually registered for VAT or have you just contacted HMRC to advise them you are self employed?

Do you have a Certificate of Registration for VAT which also gives you your VAT number?

You can't legally charge VAT without this.

markimark1984

Hi!

Registering with HMRC as self employed is the most important thing which you have done.

As your annual turnover is below the current threshold (£77,000.00) you have a choice whether to become voluntarily VAT registered or not. This is the part where you need to consider whether it would be beneficial to you.

Unfortunately as I'm a newbie I can't post a link yet, but if you go to the HMRC website and type "How and when to register for UK VAT" into the search bar > then click the link for "How and when to register for UK VAT" > then click the top link "When to register for UK VAT" you will find some good information there.

Important though, as Wywth mentioned above, you need to be VAT registered to charge VAT. It's illegal to charge if you are not.

Good luck with the crafts!

M

superskintmouse

Thanks for all your replies, I rang hmrc and registered as self employed, I will not be earning anywhere near that amount so i am safe! phew, back to crafting for me. Thanks again everyone!