VAT and IR35

[farazfastian]

Hi Guys,

I'm new to contracting via limited company so excuse if i'm asking silly question. My contractor hasn't registered me for VAT as according to him if when you submit VAT every quarter it's more likely you'll get in to IR35 investigation. Is that correct?

Instead he'll be operating me via two companies, which i know will have more operating cost plus i'll lose up to 5% from VAT and all of it is just to avoid IR35 investigation.

Thanks,
F.

[Kenny@MyAccountantFriend]

Not being VAT registered would not have any impact on your IR35 status.

Also two companies to carry out the same trade would seem more suspicious and that you are doing this to avoid VAT, along with some other potential issues.

For example which company will you take a salary from, also HMRC could take the view that it is an artificial arrangement for the avoidance of tax, namely the VAT.

[Alan @ BroomeAffinity]

I assume you mean accountant, not contractor.

If the post reflects the advice you are getting accurately, you need to, very quickly, ditch your accountant. You are getting duff advice, which is sailing close to tax evasion.

[Alan @ BroomeAffinity]

Google "disaggregation of trade for VAT"

[northernladuk]

Holy crap. Vat being a factor for IR35. That's a new one. Have you done any reading up on IR35 at all???

You are ultimately responsible for your company and it's finances so I'd pull your finger out and start understanding the basics... Quickly...

[TheFaQQer]

Holy crap. Cat being a factor for IR35. That's a new one. Have you done any reading up on IR35 at all???

Miaow

[vadhert]

Does your accountant wear a Stetson?

[DaveB]

Hi Guys,

I'm new to contracting via limited company so excuse if i'm asking silly question. My contractor hasn't registered me for VAT as according to him if when you submit VAT every quarter it's more likely you'll get in to IR35 investigation. Is that correct?

Instead he'll be operating me via two companies, which i know will have more operating cost plus i'll lose up to 5% from VAT and all of it is just to avoid IR35 investigation.

Thanks,
F.

Your accountant is an idiot. Get a new one. Preferably one that actually understand contracting.

[Scruff]

Does your accountant wear a Stetson?

Narp - a Fez...

[farazfastian]

Thank you guys for valuable advises, apologies yes i meant accountant

I've already got paid on couple of invoices without VAT, is there a way to raise VAT for those invoices or it's too late?
I'll raise my next invoice with VAT and ask him to register for VAT asap.

Thanks,
F.