VAT, from standard to flat rate

[conned tractor]

OK got it.....just being idle....here it is for everyone else:

http://customs.hmrc.gov.uk/channelsP...345#P169_14547

HMRC notic 733: Flat Rate Scheme for small businesses

[conned tractor]

Apologies in advance if a stupid question and for hijacking a thread......but.........

I'm in the process of setting up Ltd (should be incorperated by tomorrow) and have a contract at £38 ph for 18 weeks (till christmas). I understand the traditional method of charge VAT/ claim VAT at standard rate, and it has been explained to me how the FRS works, but what is the flat rate. Is there a standard rate dependant on business, i.e. contracting, or is it more specific than that?


TIA

conned tractor

[ASB]

Good news, thanks to all for the advice

LL

A bit more...

You said an exisiting company. You don't indicate what this is, but when you select the single var rate your are used it depends upn your overall profile. This can be good or bad for you. It's all on HMRC website.

[TheGadgetMan]

...and dont forget, when you start on the FRS you receive a 1% 'complimentary' reduction on your VAT for the first 12 months...now, isnt that nice of them!

[Gonzo]

Just for completeness, the upper limit for being on the Flat Rate scheme is £150,000 excluding the VAT.

[Lazylobster]

Good news, thanks to all for the advice

LL

[handyandy]

It's actually a bit more complex than that but better for us - if, when you register, you reasonably expect your first year revenue to be below the upper limt (e.g. your contract rate over 220 days i below it) you can go on the FRS - if you later bill more than the lower limit (because you got a big rate hike or did more days, etc.) you can stay on it until you hit another threshold (which IIRC is around £500K).

[pmeswani]

Gonzo was talking about the upper limit. If you go above this then you are not allowed on the FRS

My apology, I misread it completely.

[blacjac]

Gonzo was talking about the upper limit. If you go above this then you are not allowed on the FRS

[pmeswani]

Yes.

EDIT.

Actually, provided that your company meets the requirements, but if you are a one man band you would have to be on a very high daily rate to be exceeding the upper limit - about £160,000 vatable supplies if my memory serves me correctly.

I thought it was £67k was the minimum legal requirement to compulsory register for VAT (incl. Flat Rate). I've registered and my expected annual returns would be £63k. If I am wrong, please can someone point me in the right direction so that I can raise this with my accountant?

[Gonzo]

Hi all, new poster here.

Quick question, I have an existing Ltd company which is registered for VAT. I wish to use this company to put my contract through. The question is, is it possible to change the VAT scheme to that of flat rate ?

Cheers
LL

Yes.

EDIT.

Actually, provided that your company meets the requirements, but if you are a one man band you would have to be on a very high daily rate to be exceeding the upper limit - about £160,000 vatable supplies if my memory serves me correctly.

[richy]

Hi all, new poster here.

Quick question, I have an existing Ltd company which is registered for VAT. I wish to use this company to put my contract through. The question is, is it possible to change the VAT scheme to that of flat rate ?

Cheers
LL

Yes, just fill in the form or write to the Flat Rate office at HMRC Grimsby!

[Lazylobster]

Hi all, new poster here.

Quick question, I have an existing Ltd company which is registered for VAT. I wish to use this company to put my contract through. The question is, is it possible to change the VAT scheme to that of flat rate ?

Cheers
LL