When do I start paying TAX and VAT (I am a new company)

otley

I am a new small cleaning company and I am slowly getting work in. My question is when do I start paying VAT and Tax on my services, is there a fresh hold to look out for?

Thanx in advance
S:A

soolin

otley wrote: »

I am a new small cleaning company and I am slowly getting work in. My question is when do I start paying VAT and Tax on my services, is there a fresh hold to look out for?

Thanx in advance
S:A

There are many variables that need to be considered. What sort of company for a start, I personally would suggest that you speak to an accountant to set you up with the basics.

Enterprise_1701C

Please ignore the bit about Federal income tax, I assume you are in the UK?

Obviously, make sure you keep your books up to date, keep all expenses and income noted down, keep all receipts.

There are registration thresholds for VAT

https://www.gov.uk/vat-registration-thresholds

You cannot charge VAT on your invoices until you are registered, when you pay would be set up at the stage at which you register.

As to when you pay income tax etc, you really need to look up more information. The chances are you will need to complete a self assessment form.

Also, the type of company you are affects this, are you a limited company or just you?

Please note I am not an accountant, this is just from talking to others.

Good luck with the business.

DomRavioli

With regards to income tax/NI, that depends if this is your only job, and if you have had any other income since the tax year started in April 2016.

All adults get a Tax allowance, and if you earn under that in all jobs then income tax is not payable. If you earn over the allowance, then you pay tax on the amount earned over the allowance (in all jobs together, the allowance is per person, not per job).

soolin

DomRavioli wrote: »

With regards to income tax/NI, that depends if this is your only job, and if you have had any other income since the tax year started in April 2016.

All adults get a Tax allowance, and if you earn under that in all jobs then income tax is not payable. If you earn over the allowance, then you pay tax on the amount earned over the allowance (in all jobs together, the allowance is per person, not per job).

My initial question was aimed at working out whether they meant a 'company' in which case personal allowances would not apply, or wether this was in fact a sole trader where personal allowances would be applicable. Unless OP comes back to clarify, and very few do, there is no real assistance we can give.

PeterLWilson

Soolin is correct, tax rules vary depending on the type of incorporation. If you are a limited company you have corporation tax to pay which is 20% of profit, but if you are operating as a sole trader or partnership the rules are different. You should get the info you require from HRMC after you form your company. If you have not had this, give your nearest tax office a call.