IT Contractor - Flat Rate percentage - Contractor UK Bulletin Board

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john@UKCA replied

6 March 2016, 12:06
FRS Business Sector

Interestingly VAT Notice 733 states that they will change your business sector retrospectively if you get it wrong as long as your Sector choice was reasonsble?
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northernladuk replied

6 March 2016, 11:53
Haven't we done this one's already?
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fool replied

6 March 2016, 10:55
Originally posted by chris101 View Post

I am an IT Contractor and normally take on roles such as service desk, 2nd line and desktop support.
What would be the appropriate flat rate percentage for me?

For the past 1 year I have been put on by my accountant as an IT consultant which is 14.5% VAT FRS however I wouldn't consider myself as a consultant by any means...

Since my job is mainly break/fix (hands on hardware fixes and some software support) I would consider my VAT FRS to be labelled as computer repair which is 10.5%.

Would you all agree to this and if so, is there a way to back date VAT payments due to the incorrect labelling?

Thanks

If you consider the motivation of the VAT FRS is to make running small a business easier whilst not making them worse off then the then compare the two businesses, the answer is pretty clear.

An IT Consultant is someone who supllys their skills, thus has little VATable outgoings and thus the high FRS rate is fair.

A PC repair shop would be buying and supplying parts they'd be paying VAT on and thus the higher FRS would probably lose them money.

Now you can obviously attempt to twist what your company actually supplies whilst you attempt to follow the letter of the law but I'm willing to go out on the line here and suggest the lower FRS isn't really meant for you.
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WTFH replied

6 March 2016, 10:38
You accountant says no, we're not going to disagree with them.
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chris101 started a topic IT Contractor - Flat Rate percentage

6 March 2016, 10:15
IT Contractor - Flat Rate percentage

I am an IT Contractor and normally take on roles such as service desk, 2nd line and desktop support.
What would be the appropriate flat rate percentage for me?

For the past 1 year I have been put on by my accountant as an IT consultant which is 14.5% VAT FRS however I wouldn't consider myself as a consultant by any means...

Since my job is mainly break/fix (hands on hardware fixes and some software support) I would consider my VAT FRS to be labelled as computer repair which is 10.5%.

Would you all agree to this and if so, is there a way to back date VAT payments due to the incorrect labelling?

Thanks
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