VAT Rebate for self employed through accountant

Wywth

bris wrote: »

Never regester for VAT if you don't have to or you are providing VAT free services or goods. The VAT man makes a profit every time, whatever you can claim VAT back on you pay a lot more to them for the goods or service you provide.

As a tradesman it can make you uncompetitive in this harsh climate, even to other VAT registered businesses.

Non of this makes any sense to me.
How do you reconcile this with all the previous posts in this thread?

Mistral001

Wywth wrote: »

Non of this makes any sense to me.
How do you reconcile this with all the previous posts in this thread?

It is a bit confusing but quite a bit makes sense. By VAT free services I would read services that you do not pay VAT on yourself. For instance time and labour. If most of your services that your charge for are time and labour, then you actually end up being a Tax collector. You can claim very little VAT back and yet have to add 20% to th labour charge. Accountant's, solicitors, free-lance writers, architects come under this category. Aslo a plumber or decorator who's bill is made up of mostly labour comes under this category.

I presume the 9.5% flat rate is calculated on the basis that there is on average a 47.5% 52.5% split between materials and labour in the building industry. If your bills are more than 52.5% labour then perhaps the flat rate scheme might not be good value.

JasonLVC

bris wrote: »

Never regester for VAT if you don't have to or you are providing VAT free services or goods. The VAT man makes a profit every time, whatever you can claim VAT back on you pay a lot more to them for the goods or service you provide.

A business selling fruit & veg would make zero rated sales and declare no VAT but be able to reclaim input tax on all their overhead and running costs and so HMRC would be out of pocket, not in profit.

However, as a general rule, one should not consider registering for VAT voluntarily unless the numbers are stacked in ones favour.

FlyingPasty

My dad has today received one of these texts from OBK LLP and asked me to check into it for him.

He is self employed but does all his work for the same company (they even supply him with a van) who like others on this post use Boss Projects to pay him. He doesn't buy any materials and only really buys the odd low value tool.

OBK LLP have quoted him that he'll get just over £2100 every year if he signs up for FRS / VAT. I can only assume that that figure is based on the weekly gross income he gets from Boss Projects. Looking at his Boss payslip no VAT is currently taken off, if he registers for RFS / VAT does that mean Boss will need to pay him an extra 20% gross as he'll be VAT registered which will then in turn be deducted to leave him with the same weekly nett income?

OBK can then claim back the fixed rate of 9%-ish for him?

From what i've read it seem legit - altough they take 30% for their services but unless what i've said above happens i don't see how they can claim VAT if he isn't doing work for himself or buying materials?

JasonLVC

FlyingPasty wrote: »

My dad has today received one of these texts from OBK LLP and asked me to check into it for him.

He is self employed but does all his work for the same company (they even supply him with a van) who like others on this post use Boss Projects to pay him. He doesn't buy any materials and only really buys the odd low value tool.

OBK LLP have quoted him that he'll get just over £2100 every year if he signs up for FRS / VAT. I can only assume that that figure is based on the weekly gross income he gets from Boss Projects. Looking at his Boss payslip no VAT is currently taken off, if he registers for RFS / VAT does that mean Boss will need to pay him an extra 20% gross as he'll be VAT registered which will then in turn be deducted to leave him with the same weekly nett income?
See
OBK can then claim back the fixed rate of 9%-ish for him?

From what i've read it seem legit - altough they take 30% for their services but unless what i've said above happens i don't see how they can claim VAT if he isn't doing work for himself or buying materials?

Read my post here about this thing OBK are pushing
https://forums.moneysavingexpert.com/discussion/4839381

leveller2911

FlyingPasty wrote: »

My dad has today received one of these texts from OBK LLP and asked me to check into it for him.

He is self employed but does all his work for the same company (they even supply
him with a van) who like others on this post use Boss Projects to pay him. He
doesn't buy any materials and only really buys the odd low value tool.

I don't think your father would be classed as being "self employed by HMRC. The reason being he works for the same company all year round, doesn't buy any materials, very few tools , they supply a van etc.Does he have is own Public Liability Insurance?, does he quote for work? he isn't taking a financial risk working for them so he isn't self employed.The company save £thousands in employers NI etc.

The company he works for should be employing him on PAYE.

Shocking that companies are still getting away with this.

Below is pasted from his employers website:

It’s likely that you are self employed if:

• You have been provided with site instructions and you provide your services without the need for a high level of supervision.
• You do not have to accept work offered to you, and can reject offers of work without compromising any future work.
• You may send a substitute worker to site to do work in your place, albeit that this worker may have to be approved in advance.
• You provide your own tools and equipment as required.
• You decide your own hours of work, including whether to start early or finish late in accordance with site opening times and operational requirements.
• If a job is not done to a satisfactory standard you will correct any defects without additional pay.
• The work you undertake is normally of a temporary nature that can be terminated or cancelled without notice.
• You regularly work for different clients

- See more at: http://www.boss-projects.com/qualifying-for-cis#sthash.0VN4V0D2.dpuf