Simple VAT Question

[malvolio]

Come on, get real guys. the OP clearly doesn't understand the basics of VAT and how to account for it. Does debating the mechanics of FRS (which you can't go into immediately anyway), CT retention and VAT thresholds really help him out? Start with the basics, please.

[moorfield]

Don't forget the interest on your company bank account, this part of your turnover, so should have the FRV applied to it.

No that's not right. Your bank interest is not classed as turnover so no VAT applied but it will be included on your P&L account classed as other income ie you will pay corp tax on it (if you make a profit of course).

[TheFaQQer]

No that's not right. Your bank interest is not classed as turnover so no VAT applied but it will be included on your P&L account classed as other income ie you will pay corp tax on it (if you make a profit of course).

Phew - that's what I've thought!

[Ardesco]

Come on, get real guys. the OP clearly doesn't understand the basics of VAT and how to account for it. Does debating the mechanics of FRS (which you can't go into immediately anyway), CT retention and VAT thresholds really help him out? Start with the basics, please.

To be pedantic it is possible to be put on the flat rate scheme from the start of your registration, although you will have to apply for the flat rate scheme after your VAT application has been successful.

I would say knowing about the FRS may be beneficial to the OP once they have done a bit of reading and worked out how VAT is dealt with.

Here is a good place to start

HTH

[ctdctd]

The majority of contractors should be bringing in £60,000 a year unless they are on below par rates or taking quite a bit of time off.

Ah, it's nice being in a minority - any one else down here with me??

And I'm VAT registered just 'cos I can make a few pennies on the FRS - Oh, and I guess it appears more businesslike to the big wide world.

[Lewis]

Does debating the mechanics of FRS (which you can't go into immediately anyway).

Yes you can. FRS start date can be back dated to start of 1st VAT period (I assume within limits).

[Ardesco]

Ah, it's nice being in a minority - any one else down here with me??

And I'm VAT registered just 'cos I can make a few pennies on the FRS - Oh, and I guess it appears more businesslike to the big wide world.

That's assuming £300/day and only working 200 days a year. £240/day and working 250 days a year will also knock you up to £60,000 turnover a year.

Average wages that seem to be regularly quoted are usually above £30/hour for contract work.

[chris79]

Come on, get real guys. the OP clearly doesn't understand the basics of VAT and how to account for it. Does debating the mechanics of FRS (which you can't go into immediately anyway), CT retention and VAT thresholds really help him out? Start with the basics, please.

No, discussing such newbie things is forbidden and will only result in a forum flame war.

[ctdctd]

That's assuming £300/day and only working 200 days a year. £240/day and working 250 days a year will also knock you up to £60,000 turnover a year.

Average wages that seem to be regularly quoted are usually above £30/hour for contract work.

Maybe I'm in the wrong contracts - Server / Desktop support at about 2nd line level - maybe borderline 3rd line. Struggling to get above about £20/Hr within 30 miles or so of Milton Keynes.

Back to the OP, register for VAT online and wait for your certificate. Invoice ex-VAT in the meantime with "VAT Reg pending" on the invoice. Then when cert is through, register by phone for FRS. Then send invoices for the VAT amount from registration date for the "VAT Reg pending" invoices. If you are just a simple contractor, charge VAT on everything and once a quarter, add up your turnover inc VAT, multiply by FRS percentage, do online VAT return, and pay VAT via online banking. (If FRS confirmation has not come through in time may need to pay "normal" VAT in the meantime - no idea how you do that:-()

If turnover above VAT threshold, you must register. If below, it's optional but you make about £220 per 10K invoiced out of the VAT man and a bit more in the first year assuming you don't need to claim the VAT back on any purchases.

[Sockpuppet]

Come on, get real guys. the OP clearly doesn't understand the basics of VAT and how to account for it. Does debating the mechanics of FRS (which you can't go into immediately anyway), CT retention and VAT thresholds really help him out? Start with the basics, please.

You mean asking him why Jaffa Cakes are vat free when they are clearly biscuits isn''t going to help?