VAT calculation

AbbieCadabra

paddyrg wrote: »

As long as you only reclaim actual VAT - you'll find your rent, utilities etc do not attract VAT. Beware, if some supplies (eg potatoes) don't attract VAT, then this would unbalance your sums above.

all ours are billed with VAT on - rent, service charge, electricity & water (via bulk meters), all invoiced via the landlords management company. water (surface water drainage) is billed direct to us, no vat on that.

Savvy_Sue

berbastrike wrote: »

Who needs an accountant or book keeper when there is the internet!

:rotfl: only those who want advice they can rely on, ie sue the pants off the advice giver if it turns out to be duff!

zygurat789

berbastrike wrote: »

Who needs an accountant or book keeper when there is the internet!

In case you hadn't noticed the internet is more than full of ignorant people mouthing off about things they know little or less about; very few subjects more so than accountancy and tax. You only have to read the relevant board on this site to see that, even with access to the internet, lots of people make horrendous decisions which cost them far more than any professional consultation. Accountants are, after all, tax lawyers and we all know what is said about a lawyerr who represents himself.
So I would suggest that the answer to your question would be "anyone who wants to improve his/her finances.

Savvy_Sue

Actually, I think (hope?) berbastrike's tongue was firmly in cheek with that remark ... but I thoroughly agree with what you've said! People need proper (paid for) advice far more often than they initially think.

WhatsTheVAT

paddyrg wrote: »

As long as you only reclaim actual VAT - you'll find your rent, utilities etc do not attract VAT. Beware, if some supplies (eg potatoes) don't attract VAT, then this would unbalance your sums above.

AbbieCadabra wrote: »

all ours are billed with VAT on.

Yep, fully understand that. 99% of our supplies are at the 20% rate, the odd 1% aren't VATable. I go through invoices as I receive them and put them into a spreadsheet so the sums should be good. Thank you for pointing that out, though. Our British Gas and E.On bills attract VAT. Our rent doesn't, but I belive that boils down to whether the landlord has registered the building for tax (which I guess in this thread is neither here nor there.)

berbastrike wrote: »

Who needs an accountant or book keeper when there is the internet!

ps. what is your net profit margin?

I hope that's a joke. Having read your posts you are in dire need of an accountant.

DCodd

WhatsTheVAT wrote: »

It's something I've looked in to and may consider again in future but for now I can handle it.

I think for peace of mind I will stick I'll stick to how I'm doing things now; Turnover / 6 = VAT due - Cost of Goods / 6 = Total VAT due... so...
TO of £9158.20 / 6 VAT due £1,526.37 - COGs of £1,497.53 / 6 = £249.59 so Total VAT due = £1,276.78

So as long as I put the final figure aside there won't be any nasty surprises, and once I've claimed on everything else (utilities etc.) then happy days?


Thanks for the advice but I think I'll stick to spreadsheets and my laptop's calculator.

That's all well and good just so long as your not actually using the real "cost of goods" figure but are in fact using purchase invoice figure and all your purchases are subject to VAT.

WhatsTheVAT

DCodd wrote: »

That's all well and good just so long as your not actually using the real "cost of goods" figure but are in fact using purchase invoice figure and all your purchases are subject to VAT.

We have four main suppliers. When I get their invoices I put them into induvidul spreadsheets with six columns; VAT Rate, Invoice Number, Invoice Date, Order Number, Goods, VAT, Total. So yes, what I'm doing agrees with what you have said.

DCodd

WhatsTheVAT wrote: »

We have four main suppliers. When I get their invoices I put them into induvidul spreadsheets with six columns; VAT Rate, Invoice Number, Invoice Date, Order Number, Goods, VAT, Total. So yes, what I'm doing agrees with what you have said.

I have to say. For the sake of being prudent and seeing as your turnover and mark up are at the level they are, would it not be a good idea to invest in an accounts program to do the work for you?

HappyBunny

Don't forget to put something away for tax as well.

Opinion

HappyBunny wrote: »

Don't forget to put something away for tax as well.

Though would tax not only be due if the OP's business makes a profit at the end of the financial year?