Vat Help

Bean_Counter

VeryTrying wrote: »

Since you have no doubt lost your sense of humour after having to deal with the VAT people, remember that what Bean Counter meant was "advising you to lay off staff ... does seem great long term advice - NOT".

Oops missed out a 'not' which completely altered the tone of that sentence - apologies. It was not my intention to recommend laying off staff. Post now edited accordingly.

Debt_Free_Chick

And just for the general information of those who may be reading this thread "out of interest".

The reason why laying off staff is not a good idea is two-fold.

Firstly - assuming the staff deliver the service offered by your business - then fewer staff means you have less capacity. So fewer jobs to do and then less turnover.

And, of course, if they're employees "laying off staff" is a regulatory nightmare, for which you either need very comprehensive knowledge of the Employment regulations - or very expensive legal advice & assistance.

JasonLVC

Bean counter - Great post missing off the NOT. Amazing how one word can completly change the context!.;)

Smallbizowner and others :-

http://www.ukbusinessforums.co.uk/forums/

(Mods - please delete if not allowed)

This is a forum for new, start-ups and small businesses - a very useful resource for those new to business or determined to do things on their own.

dejongj

As said before if you get over the threshold you should add VAT to your invoices...There really should not be a situation that you cannot afford the VAT as you are merely a collector for it...It was never your money in the first place...In fact as also already highlighted you could (especially in the first year of registration) make extra money for no additional effort using the flat rate scheme...Although this percentage that you can keep does count towards your profit, so depending on your legal entity you may have to pay tax over it....But even so it is 'free' money....

Don't quite get what you are so worried about, unless you don't want to charge your customers the VAT....But that is your choice....

silvercar

Smallbizowner, totally understand where you are coming from. At the moment you are priced competitively, by charging VAT your prices appear to your customers to be 17.5% higher, therefore losing you business.

Worst case is that you have quoted for business that you are now obliged to honour yet you are obliged to pay 17.5% over in VAT.

The answer I'm afraid is tough. You are a victim of your own success. Unless you can add value at little cost to your services you are going to have to examine your business model.