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VAT reregistration and FRS discount

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    VAT reregistration and FRS discount

    MyCo deregistered from VAT 4 years ago (was on the FRS), but recently re-registered (with a new VAT number) and joined the FRS. Do I get the 1% discount?

    I think not, but I can't find a clear answer on the HMRC site, and all I could find from googling was an accountant saying yes in a forum post here. But that was from 2010.

    Will work inside IR35. Or for food.

    If its a new VAT registration yes the discount would apply.

    Reapplying for the FRS on an existing vat registration would not apply.


      Wow 14.5% FRS doesn't work out to much...

      £100k + 20% VAT = £120k

      120k x 14.5% = £17.4k

      £120k - £17.4k = £102.6k turnover


        its 2.6k for doing the VAT mans job.

        I'm alright with that arrangement...
        If you think it's expensive to hire a professional to do the job, wait until you hire an amateur. - Red Adair


          Originally posted by Bluespider View Post
          its 2.6k for doing the VAT mans job.
          £2.6k...less any irrecoverable input VAT you pay over the course of the year.

          Should still be pretty profitable for the average contractor but not necessarily as much as people think. If you have to buy a lot of hardware and can't get it all in one go from the same supplier to benefit from the £2k capital asset rule you could wipe a lot of that FRS surplus out.


            It's not a lot, but it is some free money from the government. And compared to being on normal VAT it's simpler as you don't have to add up your expenses and keep receipts. Not that I have any expenses.

            Thanks for the reply Kenny. Seems like that would be open to some abuse.
            Will work inside IR35. Or for food.