New to contracting do I need a VAT number

[chris5126]

Hi Guys,

I'm just about to start my first contract, have set up my own ltd company through an accountant and have started the process of opening a business bank account, what else do I need to do to make myself ready. I have heard people talking about registering for a VAT number, do I have to do this and how do I go about doing it?

[northernladuk]

Get your accountant to do it.

[LisaContractorUmbrella]

You only have to register for VAT if you exceed the threshold of £70000 Vatable turnover; however some contractors register straight away so that they can take advantage of the flat rate scheme - your account will explain the ins and outs of the scheme.

[chris5126]

Ta very much, very helpful

[kaiser78]

Hi Guys,

I'm just about to start my first contract, have set up my own ltd company through an accountant and have started the process of opening a business bank account, what else do I need to do to make myself ready. I have heard people talking about registering for a VAT number, do I have to do this and how do I go about doing it?

Has your accountant not discussed this with you ? This is about as bog standard as it gets when setting up the company. Crazy. Speak to him.

[Wanderer]

As Northernlad says, your accountant can sort this out for you.

You can do it yourself online. It's not so difficult, probably everything you need to know is here HM Revenue & Customs: How and when to register for VAT. After you have signed up to the Government Gateway you do your VAT returns online.

There is a threshold for registering is £70,000/year but even if you are under that there is nothing to stop you registering anyway. It does create a little bit more admin.

If you are a straight IT contractor and you don't buy and sell a lot of stuff then you may be able to make money out of the Flat Rate Scheme (FRS), depending on how your business runs. As an IT consultant, you would charge 17.5% VAT and then pay 13% of it to the VAT man (12% in the first year), the balance is profit for your company. Money for old rope really because no agency you deal with will care if you charge VAT or not.

If you don't have an accountant, then you should probably get one. You can run a company for a while without one and then you land in a pile of trouble (been there, done that). It's best to get someone to guide you through how to deal with all the admin....

[SackmanandCo]

Most agencies insist on VAT registration, so really you should start the process asap.