Hi guys

 

I am thinking along the lines of starting another non VAT registered company to help reduce peoples costs ie a £2000 repair is obviously £2350 with VAT.

 

How many of you are VAT registered? PM me if you dont want to post.

The main problem with not being registered is that all YOUR costs will rise by 171/2% since your suppliers will still levy vat on all your purchases and you will not be able to reclaim that back.

For example, on a £2000 job with a 50/50 parts/ labour split you will only be able to reduce the customers bill by £117.50. The £1000 worth of materials will in fact have cost you £1175.so you will need to charge that to your customer to avoid a loss of £117.5 in your profits.

So that £2350 bill in fact only reduces to £2175. Its still a "saving " to the customer but its not as much as you suggest.

And you dont think the Vat man isnt going to be suspicious about a parallel non registered company operating out of the same premises and doing the same work as your Vat registered company???? :confused: :confused:

In my 22 years of dealing with the Vat (and Tax) people I have yet to find one who isnt highly trained and motivated to collect the MAX from everyone they "call in" on. :(

All the above of course IMHO.

Thanks for that info. Oh well, + VAT it is then!!

Hi guys

 

I am thinking along the lines of starting another non VAT registered company to help reduce peoples costs ie a £2000 repair is obviously £2350 with VAT.

 

How many of you are VAT registered? PM me if you dont want to post.

 

We are VAT registered and tbh its a pita, always wanted to keep the company under the threshold but since we did the threshold in the first four months of trading it was a bit difficult although we are starting a seperate parts company that will stay under the threshold so that we can give the best prices possible.

You pay the Vat difference ie your labour charge to the customer. You caim back all you vat you pay out ie if you buy a new van they are plus Vat that you can get back.

 

Your business customers will caim back the Vat you charge them. None business customers ie. Mr Jo Public Will pay the Vat on the parts & Vat on your labour or he may say I AM NOT PAYING YOU VAT AS I PAYED YOU IN CASH. Then you have to pay the Vat on the invoice you were not able to collect off him or take him to court or tell your accountant your customer did not pay is Vat bill. It can be hard to collect of some customers in the type of job we do. Jo Public does not paying Vat so he may go

to another paint shop to save the Vat on your labour just a thought. hope it helps.

If you are registered as a sole trader then it`s you who is VAT registered not the business so you can`t set another company up in your name. If you are a LTD company then may be a loophole.

 

Bob

I have a ltd company (car sales) which is vat registered

I also have a tinting business which is a sole trader and not vat registered - it will never reach the vat threshold.

Since both businesses are different, VAT inspector is not involved in the tint side.

I had a VAT inspection last November - was totally upfront about the whole lot(they operate from the same premises.

VAT man said tint was none of his concern.

However - supplying parts comes too close to the car sales side of things and so could be considered as VAT liable form VAT man's point of view.

Why not set upanother business, not reaching the threshold ever, sole trader in someone else's name? Then it has nowt to do with you, let alone the VAT man inspecting you.

Be careful of income though. HMC&E (or whatever their name is today) have some shiote-hot forensic accountants and can tell quickly if your income matches your declarations.

Apparently there is nothing to stop your company charging a management fee to any other company for skills. Your company or another person's. Again be careful of income.

IAM A REAR ONE AS I LOVE BEEN VAT REG :rofl: I SELL BOOKS AND THERES NO VAT ON BOOKS SO EVERY QUATER I GET OVER £1K BACK :bow:

I also love being vat reg :rofl: I own a wholesale sandwich business and i to get all my vat back. What an insentive to do your vat return a. :hyper:

:x: sinclair can afford to subsribe then lol :eek:

He won't though - can't claim the VAT back

:)

Thanks for the info guys.

 

I am going to look into setting up another company me thinks. I need to prove that modifications are different to accident work. I know that mods are more labour intensive & there are less parts involved.

 

Its a difficult one VAT. Yesterday I lost a job cos the customer said they would not pay it. :headvswal

Its a difficult one VAT. Yesterday I lost a job cos the customer said they would not pay it.

 

Well the answer is to give an all in quote to a private customer!!! ;)

Remember that is what all retail prices are anyway( for example in my shop on the high street).

If you ask me how much a tin of Lynx Deoderant is then I will tell you its £1.99.

I dont tell you its £1.70 PLUS VAT!!!LOL

Marketing is just as complicated as vat you know!! ;)

He won't though - can't claim the VAT back

:)

:hyper: :hyper: :hyper: :hyper: :hyper: :hyper: :hyper: :hyper: :hyper: Ill subscribe, show me where?

If you are registered as a sole trader then it`s you who is VAT registered not the business so you can`t set another company up in your name. If you are a LTD company then may be a loophole.

 

Bob

 

Spot on there mate!.

 

If you are a sole trader then you have one VAT reg number (if you go above the £50-60K registration threshold) for ALL of you businesses, regardless of what they are and turn-over. You personally would need to register for VAT if the total turnover of all your businesses exceeded the registration limits.

 

However you can have a dozen limited companies all trading below the registration limit and not have to register any of them for VAT.

 

As for giving your customers an "inclusive" price - that's all well and good but remember that 7/47ths of what you get still has to be paid over to HM Customs. Also most decent businesses would be registered for VAT anyway, including your competition.

 

Richard :smw: