Daily Rate (plus VAT)

**Sockpuppet** · 9 July 2007, 20:36

Ignore the vat.

You would charge £117.50 a day but DO NOT THINK THIS IS YOUR MONEY. The vat has to be paid to el gordo? So dont think of it as yours. Best to seperate it straight away and to put it into a seperate account.

**malvolio** · 9 July 2007, 20:36

To keep it simple, No. Your daily rate is £100, to which you have to add £17.50 VAT once you are VAT registered.

This is basic knowlege, I think you need to do a bit more reading of the first-timer guides...

**TheFaQQer** · 9 July 2007, 20:38

Yes.

But bear in mind that VAT money doesn't belong to you - it belongs to the VAT man, so you have to hand it over.

If you're not yet registered then you need to invoice with "VAT number pending" on the invoice and then invoice for the back VAT once you're registered.

**ssrai** · 9 July 2007, 21:07

ok chaps, cheers for the advicve

**thunderlizard** · 9 July 2007, 23:05

I'm soon to be VAT registered and have my own Ltd company

then it's the ltd company that needs to be VAT registered, not you.

**Cooperinliverp00l** · 10 July 2007, 08:33

Originally posted by TheFaqqer

Yes.

But bear in mind that VAT money doesn't belong to you - it belongs to the VAT man, so you have to hand it over.

If you're not yet registered then you need to invoice with "VAT number pending" on the invoice and then invoice for the back VAT once you're registered.

Invoice with VAT number pending but make sure you explain to the person your invoicing what the crack is. I recently recieved my VAT number and then sent invoce off to cover the VAT that was missed from all previous ones. Cause i had already breifed the Agency that this was the route i was going down they paid up quite quickly

**Pacman** · 10 July 2007, 12:22

Originally posted by ssrai

Greetings,

I have been offered a daily rate (to keep it simple) of £100 + VAT

seeing as i'm new to the game, could anyone shed any light on the 'plus VAT' aspect?

For example, does this mean that if vat was 17.5%, my daily rate would be £117.50?

I'm soon to be VAT registered and have my own Ltd company

Thanks

If you register for Flat Rate Scheme then your VAT is reduced.

E.g. an IT worker can register for flat rate of 13%. So you charge 17.5% to the client, and you pay El Gordo (or El Darling now) 13%. So in your example above, your rate is £100 + £17.50 VAT, your company receives £117.50 from the client. With FRS, you only pay 13% VAT, so thats £13 to El Darling. The remaining £4.50 go into your profits.

Tete de veau!!

**malvolio** · 10 July 2007, 12:41

Originally posted by Pacman

The remaining £4.50 go into your profits.

And you pay 20% CT on that £4.50, so your net gain is actually £3.60...

**Old Greg** · 10 July 2007, 12:57

Originally posted by Pacman

If you register for Flat Rate Scheme then your VAT is reduced.

E.g. an IT worker can register for flat rate of 13%. So you charge 17.5% to the client, and you pay El Gordo (or El Darling now) 13%. So in your example above, your rate is £100 + £17.50 VAT, your company receives £117.50 from the client. With FRS, you only pay 13% VAT, so thats £13 to El Darling. The remaining £4.50 go into your profits.

Tete de veau!!

I though you pay 13% of the £117.50 - £15.28, not of the £100. Is that correct or not?

And the 13% is reduced to 12% in your first year of registration?

Daily Rate (plus VAT)