first contract advice...

[MyUserName]

Oh - sorry, just realised that this is Business and not General!

[josh1e]

Your daily rate is excluding VAT. B2B contracts don't include VAT. Remember this a contract between your Ltd and the Employment Business.

If your daily rate is £220p/d you'll be charging £220 + £44 VAT = £264pd

You won't charge this until you are VAT registered, though.

Parity won't let you use their self-billing system until you are, so you'll need to draw up your own template Invoice and send that in to Parity's e-mail address with your timesheet each month.

A word to the wise - Parity expect to see your timesheets for the whole month up to and including the last Friday of the month by the following Wednesday at mid-day in order to be paid the Thursday the week after that.

Thanks 7specialgems. I have already added VAT to my invoice, I wasn't sure if they would try to haggle me out of it as I didn't specifically agree wether the rate included it or not in the first place. You live and learn... So many horror stories.. (yep understand contract is B2B)

I have to say, this is all premature worrying / arming myself with as much information as possible.... As yet I have no reason to say anything bad about them and would so far recommend them...

I registered for (breath in....) Corp Tax, VAT, PAYE, Self Assessment (as an individual), the company is incorporated with Companies House and have co bank acc, indemnity & liability cover as well as business cover on the car.. phew.. not sure if i missed anything there? oh & I have business references and a get out of jail free card... (not sure monopoly money counts with HMRC?)

@ SausageSurprise... thanks for the recommendation, have had a couple from the forum. will take a read through what they offer vs £ and reviews.

[7specialgems]

not sure if i missed anything there

Not sure either. I pay my accountant about £80 + VAT a month to do all that. I worked out early on that it was cheaper for me to pay him to get on with all that when I worked out how much per hour I cost and how long I think it would take me to study it all and fill it all out

If you've not received your VAT certificate and number yet, don't charge for VAT. It's an offence.

If the number has arrived, make sure it is on your invoice.

[josh1e]

Not sure either. I pay my accountant about £80 + VAT a month to do all that. I worked out early on that it was cheaper for me to pay him to get on with all that when I worked out how much per hour I cost and how long I think it would take me to study it all and fill it all out

If you've not received your VAT certificate and number yet, don't charge for VAT. It's an offence.

If the number has arrived, make sure it is on your invoice.

don't worry I've every intention of handing it over for someone who knows what they're doing to keep on top of it.. too many penalties / fines for getting it wrong for my liking... Not to mention no advice for how to get the best out of your companies earnings ...

Do you know if Parity actively look for something when your current contract is due to end or if they prefer known contractors for upcoming contracts?

Thanks again for your help!

[7specialgems]

Do you know if Parity actively look for something when your current contract is due to end or if they prefer known contractors for upcoming contracts?

Well...think about it...

If you're serving well in the role and the client wants to renew you, it isn't very difficult for them to issue a renewal schedule and continue to skim their fee off your (actual) daily rate.

If you're out after three months and there aren't any mitigating circumstances, I would only expect the agent to bat for me if the market was very dead or my skills were very niche...

[Wanderer]

Thanks 7specialgems. I have already added VAT to my invoice, I wasn't sure if they would try to haggle me out of it as I didn't specifically agree wether the rate included it or not in the first place. You live and learn... So many horror stories.. (yep understand contract is B2B)

There is some information about how to deal with VAT while you are waiting for VAT registration from HMRC.

If you do add the VAT then you don't actually call it VAT but make it clear to the client that VAT registration is pending and you will reissue the invoice with the VAT shown once the registration is done.

With a registration taking about 2 weeks, I would be inclined to just wait for the cert to come through before invoicing to save messing about but then again, if the client is happy to pay the 20% extra in the interim then go for it...

[7specialgems]

If you do add the VAT then you don't actually call it VAT but make it clear to the client that VAT registration is pending and you will reissue the invoice with the VAT shown once the registration is done.

According to your resource:

If you are registering voluntarily, you must account for VAT from the date you asked for on your application form.

So, it depends on the date that he specified that he wanted his registration to be effective from.

In my invoices to Parity, I charged Services only whilst waiting for my VAT certificate, and successfully put in a VAT-only invoice to cover the period between the effective date and an invoice date, after my VAT certificate had arrived.

Don't ask for VAT for services before the date you specified that you wanted to become registered.

[malvolio]

According to your resource:



So, it depends on the date that he specified that he wanted his registration to be effective from.

In my invoices to Parity, I charged Services only whilst waiting for my VAT certificate, and successfully put in a VAT-only invoice to cover the period between the effective date and an invoice date, after my VAT certificate had arrived.

Don't ask for VAT for services before the date you specified that you wanted to become registered.

True but the rule is to include the phrase "VAT Regstration applied for" on your invoices, so there's no arguments when you present them with an invoice for the VAT you would have charged. As the man said, you have to charge VAT on all invoices raised from the application date; there are deep legal and financial reasons why it's necessary but that needn't bother anyone, and agencies are well used to dealing with it anyway.

But get your sums right and money in the bank. The VAT is due at quarter end whether or not you've been paid it by the agency.