Flat rate scheme

[MikeC1408]

12% for an IT Contractor is including the 12% just remembered to change mine to 13%

[50ft jesus]

Gros

Don't forget you get a 1% discount in your first year.

Cheers.

[Gros]

Super, thanks Gonzo, that does indeed help.

[Gonzo]

Hi all. Humour me, this is going to seem obvious to many of you, but I just want to clarify something in my mind.

Let's say as an example, I bill £1000, plus the VAT so the total amount billed is £1175.

I think the VAT I pay back to HMRC is at 12% (my company is in first year of IT contracting). Should the amount payable be 12% of £1000, or 12% of £1175?

The reason I ask is that I assume that it should be the former, whereas my accounts seem to show that I have paid the latter!

Thanks...

Your accounts are right, you are not.

hth

You have to apply the flat rate percentage to the gross invoiced amount including the VAT. So you don't get to keep 5.5%. It is more like 3.5%. And you have to pay corporation tax on that too.

When I say you, I mean your company, obviously.

[Gros]

Hi all. Humour me, this is going to seem obvious to many of you, but I just want to clarify something in my mind.

Let's say as an example, I bill £1000, plus the VAT so the total amount billed is £1175.

I think the VAT I pay back to HMRC is at 12% (my company is in first year of IT contracting). Should the amount payable be 12% of £1000, or 12% of £1175?

The reason I ask is that I assume that it should be the former, whereas my accounts seem to show that I have paid the latter!

Thanks...