Originally posted by Newbie Simon
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Limted company on flat rate scheme
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Originally posted by Newbie Simon View PostThe agency has said it excludes VAT, they also take 10% so every £10 they make £1'CUK forum personality of 2011 - Winner - Yes really!!!!Comment
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Originally posted by Newbie Simon View PostThe agency has said it excludes VAT, they also take 10% so every £10 they make £1
You then pay £1.74 of that to HMRC, assuming you are on the FRS rate of 14.5%
So your company earns £10.26 per hour because of the FRS profit, and pays corporation tax on that, leaving you with £8.21 an hour.
If your rate is 13.5% (as you mention earlier), then you pay over £1.62 for each hour worked, have profit of £10.38 an hour, and after corporation tax are left with £8.304 an hour.
If you are clear to your accountant about your rate being exclusive of VAT, and they are doing it wrong, then you need to change your accountants quickly before anything else gets messed up.Comment
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Thanks TheFaQQer
Hourly rate inclusive of VAT:-
£8.33+VAT=£10
£10-£1.35-CT=£6.92
Hourly rate exclusive of VAT:-
£10+VAT=£12
£12-£1.62-CT=£8.30
Looks like my accountant has got it wrongLast edited by Newbie Simon; 8 March 2015, 08:58.Comment
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