Clarification about VAT exclusion in the contract rate

[sireesh]

If you are VAT registered, then you need to add VAT to the invoice.



Fees (note the capitalisation) = agreed fees for the Consultancy Services + expenses or disbursements + VAT

So take your rate, add any expenses or disbursements authorised by the client, and add VAT. Bad wording to use Fees and fees in the same context, but that's what I'd invoice for, assuming you are VAT registered or have a VAT registration pending. If you don't then the whole thing is a moot point.

Thank you for your reply. As you mentioned the use of fees and Fees is very confusing.
The thing which made me worry was that the contract had my actual rate listed as

"Consultancy Fees" : £My_Daily_Rate

Also, in the contract there is no mention of what the agreed fees is as mentioned in the definition of Fees
I will raise the invoice with Daily rate + VAT and see how it goes.

[sireesh]

Yup it's still done. Just be careful as it applies to the first year of VAT registration, not a whole year from the date of flat rate registration.

I did opt for Flat Rate Scheme and got the VAT number last Friday.

[Clare@InTouch]

Including the additional 1% discount for the first year (if this is still done). Every little and all that...

Yup it's still done. Just be careful as it applies to the first year of VAT registration, not a whole year from the date of flat rate registration.

[sireesh]

WSS

I did register for the Flat Rate scheme and got my company's VAT number last Friday.

[kaiser78]

Investigate the Flat Rate Scheme too, and you could gain an extra couple of grand per year.

Including the additional 1% discount for the first year (if this is still done). Every little and all that...

[sireesh]

If you are VAT registered, then you need to add VAT to the invoice.



Fees (note the capitalisation) = agreed fees for the Consultancy Services + expenses or disbursements + VAT

So take your rate, add any expenses or disbursements authorised by the client, and add VAT. Bad wording to use Fees and fees in the same context, but that's what I'd invoice for, assuming you are VAT registered or have a VAT registration pending. If you don't then the whole thing is a moot point.

Thank you for your reply. As you mentioned the use of fees and Fees is very confusing.
The thing which made me worry is that the contract had my actual rate listed as

"Consultancy Fees" : £My_Daily_Rate

Also, in the contract there is no mention of what the agreed fees is, which is mentioned in the definition of Fees
I will raise the invoice with Daily rate + VAT and see how it goes.

[CloudWalker]

Investigate the Flat Rate Scheme too, and you could gain an extra couple of grand per year.

WSS

[sal]

Excuse the newbie but why?

If not registered for VAT, do not register (subject to advice from contractor) until threshold is reached.

When:

Investigate the Flat Rate Scheme too, and you could gain an extra couple of grand per year.

[Clare@InTouch]

Investigate the Flat Rate Scheme too, and you could gain an extra couple of grand per year.

[speling bee]

If you are VAT registered, then you need to add VAT to the invoice.



Fees (note the capitalisation) = agreed fees for the Consultancy Services + expenses or disbursements + VAT

So take your rate, add any expenses or disbursements authorised by the client, and add VAT. Bad wording to use Fees and fees in the same context, but that's what I'd invoice for, assuming you are VAT registered or have a VAT registration pending. If you don't then the whole thing is a moot point.

If not registered for VAT, do not register (subject to advice from contractor) until threshold is reached.

[northernladuk]

If you understand so little about your chosen career get yourself an accountant before you get yourself in some serious trouble.

If you are a director of an LTD you have a legal responsibility to get this right and ignorance is not a defence.

Also start reading the guides hard. There is a hell of a lot more I am sure you are not aware of.

[TheCyclingProgrammer]

If you are VAT registered, then you need to add VAT to the invoice.



Fees (note the capitalisation) = agreed fees for the Consultancy Services + expenses or disbursements + VAT

So take your rate, add any expenses or disbursements authorised by the client, and add VAT. Bad wording to use Fees and fees in the same context, but that's what I'd invoice for, assuming you are VAT registered or have a VAT registration pending. If you don't then the whole thing is a moot point.

Small but important point: any disbursements should be added after the VAT, so it's (fees + expenses) + VAT + disbursements.

[TheFaQQer]

Being a newbie to contracting I wasn't aware of the VAT and other taxation.

Could someone please clarify if this does indicate the inclusion of VAT in my consultancy fees?

If you are VAT registered, then you need to add VAT to the invoice.

“Consultancy Fees” : means the fees payable to the Consultancy for the provision of the Consultancy Services as set out in the Schedule. For the avoidance of doubt, the Consultancy Fees include the agreed fees for the Consultancy Services, any expenses or disbursements authorised by the Client and VAT charged at the applicable rate; and

Fees (note the capitalisation) = agreed fees for the Consultancy Services + expenses or disbursements + VAT

So take your rate, add any expenses or disbursements authorised by the client, and add VAT. Bad wording to use Fees and fees in the same context, but that's what I'd invoice for, assuming you are VAT registered or have a VAT registration pending. If you don't then the whole thing is a moot point.

[sireesh]

Hi,
I've signed my first contract last month.
Being a newbie to contracting I wasn't aware of the VAT and other taxation.
I should have paid more attention in reading the contract.

Today, while trying to raise an invoice, I realised that I need to include VAT in the bill.
I just had a look at my contract. To my surprise it seemed to include the VAT in my rate.
Below is the snippet from my contract giving the definitions. Could someone please clarify if this does indicate the inclusion
of VAT in my consultancy fees?

“Consultancy Fees” : means the fees payable to the Consultancy for the provision of the Consultancy Services as set out in the Schedule. For the avoidance of doubt, the Consultancy Fees include the agreed fees for the Consultancy Services, any expenses or disbursements authorised by the Client and VAT charged at the applicable rate; and

Thanks,
Sireesh