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Vat On Expenses When Not Vat Registered

NICHOLAS_2
Posts: 613 Forumite
I think i am going insane here, my initial thoughts were that if i bought something that was solely for business use, i could only claim the cost of it without the VAT figure.
But i think i have been wrong, hopefully, if i spent, for example, £100 on advertising which was £120 with the VAT i claim the £120, the only difference is that i can't claim the £20 back as cash?
Am i right?
But i think i have been wrong, hopefully, if i spent, for example, £100 on advertising which was £120 with the VAT i claim the £120, the only difference is that i can't claim the £20 back as cash?
Am i right?
0
Comments
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I think i am going insane here, my initial thoughts were that if i bought something that was solely for business use, i could only claim the cost of it without the VAT figure.
But i think i have been wrong, hopefully, if i spent, for example, £100 on advertising which was £120 with the VAT i claim the £120, the only difference is that i can't claim the £20 back as cash?
Am i right?
If you are not vat registered then you have paid £120 for advertising and that is the cost you may reclaim against your income for income tax purposes.
If you are vat registered then you may claim £20 back as vat input tax and the cost is only £100 that you may claim for income tax purposes.
If you are not vat registered don't even think about this sort of idea.The only thing that is constant is change.0 -
Hi, thanks for that. I wasn't thinking about doing anything dodgy, i was just trying to work out whether i deduct expense including vat or minus.
I am quite a happy person right now, my tax bill is going to be nowhere near a big as i thought it was going to be.
When i was doing rough maths a few months ago i was minusing VAT from my expenses0 -
Hi, thanks for that. I wasn't thinking about doing anything dodgy, i was just trying to work out whether i deduct expense including vat or minus.
I am quite a happy person right now, my tax bill is going to be nowhere near a big as i thought it was going to be.
When i was doing rough maths a few months ago i was minusing VAT from my expenses
The downside of not paying much tax is you won't be making much profit !
Not being vat registered will impact on your profitability if you are making a lot of vat added purchases , how much vat are you losing a monthVuja De - the feeling you'll be here later0 -
Hi, thanks for that. I wasn't thinking about doing anything dodgy, i was just trying to work out whether i deduct expense including vat or minus.
I am quite a happy person right now, my tax bill is going to be nowhere near a big as i thought it was going to be.
When i was doing rough maths a few months ago i was minusing VAT from my expenses
If you ever think about becoming VAT registered then it is bad news if you sell to the general public or other non-vat registered people.The only thing that is constant is change.0 -
The downside of not paying much tax is you won't be making much profit !
Not quiteNot being vat registered will impact on your profitability if you are making a lot of vat added purchases , how much vat are you losing a month
It's more the impact on customers that is the problem for self employed people and VAT.
It's ok if you're business to business, b2c is a lot harder when there are so many people going around in my industry that don;t pay any tax never mind charging vat. You can probably guess the business sector.0 -
zygurat789 wrote: »If you ever think about becoming VAT registered then it is bad news if you sell to the general public or other non-vat registered people.
Yes it is, unless you are prepared to sink more hours and money into it to try and grow the business into something more substantial.
I want to eventually cut myself out of the loop altogether by working on my own projects so i wont have any customers anyway, growing a business has never appealed to me.0
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