VAT Return for end of Nov!!!

[BolshieBastard]

Surely most contractors should be on the flat rate VAT?

Only if they have few if any expenses.

If you're working away from home and living in B&B its worthwhile not being on the FRS.

Besides, you can reclaim the VAT element on any fuel you purchase even if claiming mileage.

And please, dont anyone say you cant because you can.

[Gonzo]

Surely most contractors should be on the flat rate VAT?

It depends on the input VAT.

The flat rate for contractors works if expenditure is low, but as soon as there is significant expenditure, on fuel and hotels for example, then it is usually better to be off the FRS.

EDIT - I see that Bolshie has already answered. Basically WHS.

[TykeMerc]

Besides, you can reclaim the VAT element on any fuel you purchase even if claiming mileage.

And please, dont anyone say you cant because you can.

Doesn't the old Scale Rate charge still apply if you reclaim the VAT on fuel or has that rule gone?
The charge used to pretty much knobble the benefit unless you used a lot of fuel.

I agree if you have a fair bit of VATable expense the FRS isn't worth it, it's one of the judgement calls any business should make. I tend to rent rather than stay in VAT registered hotels when I'm away so FRS works for me reasonably well.

[Sally BFCA]

Many contractors do benefit from the FRS VAT Scheme.

HMRC have a calculator tool that will indicate if you will benefit.

It only takes a phone call to your VAT office to change over.

[Maslins]

Doesn't the old Scale Rate charge still apply if you reclaim the VAT on fuel or has that rule gone?
The charge used to pretty much knobble the benefit unless you used a lot of fuel.

Fuel scale charge (FSC) does still exist, but only if you reclaim VAT in respect of private fuel.

So if you use 40p/mile route for business miles, you can reclaim VAT on part of that cost (2p/mile and you won't be too far out) without worrying about FSC.

If on the other hand you have a company car, putting all motor costs through the business & reclaiming all the VAT on fuel, then you should then pay the FSC.