The VAT switch back to 17.5%

[lje]

So the 31 dec invoice will be based on 15% VAT, and then when payment is received later on one will have to return FRS VAT based on 17.5% ? Isn't it disadvantageous for one's ltd ?

(assuming one uses the cash based turnover method)

No - the VAT due under the flat rate scheme will also be based on the 31 Dec not when the money is received (even if you use the cash based turnover method).

[Lumiere]

No - the VAT due under the flat rate scheme will also be based on the 31 Dec not when the money is received (even if you use the cash based turnover method).

Was it in one of the VAT change leaflets from HMRC?

[Punter]

Was it in one of the VAT change leaflets from HMRC?

Cash-based turnover method
This method allows you to account for your VAT liability when you receive payment. It does not affect the time of supply (tax point). So if your flat rate percentage changes, you must apply the rate that was in place at the time of supply and not the rate that is in place when payment is received.

http://www.hmrc.gov.uk/vat/start/sch...lat-rate.htm#6

HTH

[sweetandsour]

Was it in one of the VAT change leaflets from HMRC?

All of the info that you need is in the HMRC notes. Section 8.3 deals with the cash accounting scheme.

http://www.hmrc.gov.uk/vat/forms-rat...ance.pdf#sec21

It seems that it is OK to raise an invoice after 1st January for services supplied before 1st January with the 15% VAT rate. Despite that, I think it is just easier to raise the invoice on 31st December.

[Moscow Mule]

, I think it is just easier to raise the invoice on 31st December.

Or, stop work on the 18th, and invoice then...