Vat query on solid fuels/ wood / coal etc when reselling

seaneylad

Hello

Solid fuels are sold with with 5% vat if burning as a customer at home

When buying to resell the companies charge 20% vat 

I have been reselling logs and coal on the side and i buy the items with 20% vat applied whcih bumps price right up even when buying bulk, i have been selling with out vat added as im not registered. 

If i register my company for vat voluntary am i right in thinking i can claim the 20% vat back from hmrc and charge 5% selling to my customers and im 15% better of overall.
there isnt some catch on hmrc side? 

Thanks 

molerat

Non VAT registered you pay £6 for an item (£5 + £1 VAT) and sell for £10 then £4 is taxable profit

As VAT registered you pay £5 + £1 VAT and sell for £10 (£9.52 + 48p VAT).  You have £4.52 profit and reclaim 52p VAT from HMRC making £5.04 taxable profit.