IET logo
 
IET
Decrease font size
Increase font size
Topic Title: Vat threshold
Topic Summary:
Created On: 07 November 2017 05:58 PM
Status: Read Only
Linear : Threading : Single : Branch
1 2 3 Next Last unread
Search Topic Search Topic
Topic Tools Topic Tools
View similar topics View similar topics
View topic in raw text format. Print this topic.
 07 November 2017 05:58 PM
User is offline View Users Profile Print this message



dustydazzler

Posts: 1449
Joined: 19 January 2016

Overheard a couple builders chatting in my local merchants and couldnt help hear them saying the vat threshold looks set to be lowered to just £10,000

Anyone else heard this

?
 07 November 2017 06:21 PM
User is offline View Users Profile Print this message



schlafsack

Posts: 4
Joined: 07 November 2017

Looks like it was a recommendation from the OTS, although the press release does not seem to mention a figure:

https://www.gov.uk/government/news/ots-publishes-its-first-review-of-vat

I suspect the £10k figure came from the fact that a lot of europe uses €10k as the threshold.

Telegraph mentioned £26k:

https://www.pressreader.com/uk/the-daily-telegraph/20171104/281513636421195

OTS is just an advisory body, and the full report has not been released yet.

It's bad if true, my GF sells second hand items, so is not part of a chain where she can recover the costs. Would put her out of business.

Tom
 07 November 2017 06:35 PM
User is offline View Users Profile Print this message



dustydazzler

Posts: 1449
Joined: 19 January 2016

The last time the uk vat level was set at £10,000 was 1978

A 10,000 threshold today would pretty much drag every self employed person into charging vat on their goods and services

Scary
 07 November 2017 07:07 PM
User is offline View Users Profile Print this message



davezawadi

Posts: 3905
Joined: 26 June 2002

I think it is unlikely to be changed. It would probably lead to at least another 1million unemployed, as the level of admin needed is very significant, and many would not think it worth the effort. Certain lefty's want to ruin small business, and think that we all make a fortune and pay no tax! They keep up the scare tactics which should be ignored by politicians with any sense at all. The Paradise disclosure shows just who is avoiding tax.

-------------------------
David
BSc CEng MIET
david@ZawadiSoundAndLighting.co.uk
 07 November 2017 07:14 PM
User is offline View Users Profile Print this message



Blencathra

Posts: 16
Joined: 07 November 2017

According to The DT Philip Hammond was looking at the proposal favourably, not a lefty AFAIK
 07 November 2017 09:06 PM
User is offline View Users Profile Print this message



colinhaggett

Posts: 468
Joined: 08 July 2004

Why is being VAT registered a bad thing?
 07 November 2017 09:18 PM
User is offline View Users Profile Print this message



daveparry1

Posts: 7745
Joined: 04 July 2007

I remember it being 5 k when it first started Dusty, around 1973 I think. I had to register then but came out of it around 1980.
 07 November 2017 09:20 PM
User is offline View Users Profile Print this message



Blencathra

Posts: 16
Joined: 07 November 2017

I think its the extra admin mainly
 07 November 2017 09:23 PM
User is offline View Users Profile Print this message



dustydazzler

Posts: 1449
Joined: 19 January 2016

Originally posted by: daveparry1

I remember it being 5 k when it first started Dusty, around 1973 I think. I had to register then but came out of it around 1980.


5000 was the original introduction of vat iirc

Raises to 10000 in 1978

Then gradually increased ever since
 07 November 2017 09:24 PM
User is offline View Users Profile Print this message



daveparry1

Posts: 7745
Joined: 04 July 2007

Colin, partly because it means that we become unpaid tax collectors for the government and also it means we have to charge more for our work, whereas the "cash in hand" benefit collecting "tradesmen" can undercut us, (as they do now but more so!)
 07 November 2017 09:33 PM
User is offline View Users Profile Print this message



John Peckham

Posts: 8791
Joined: 23 April 2005

Yes I read in the Sunday Times that there was a possibility that the Government were thinking of lowering the VAT threshold.

I am not sure if that was a lucky guess by a journalist or a leak from government to test the water or prepare us for the shock. The government need to extract more cash from the general public rather than go after their mates and party donors who operate off shore.

I saw the TV programme where individuals get all their pay/earnings paid to an offshore company and then the offshore company lend them the money back so no tax to pay and never get to repay the loan. I am thinking of doing this can anyone recommend a suitable company offshore to do this for me?

-------------------------
John Peckham

http://www.astutetechnicalservices.co.uk/
 07 November 2017 09:36 PM
User is offline View Users Profile Print this message



Blencathra

Posts: 16
Joined: 07 November 2017

I am thinking of opening a bank on Lundy
 07 November 2017 09:50 PM
User is offline View Users Profile Print this message



Lillpete

Posts: 129
Joined: 04 August 2011

I have just de-registered as most of my work is domestic it just made me more expensive with no real benefit (other than reclaiming the VAT on my tools and fuel)

I also hated having to pay via direct debit every quarter
 07 November 2017 09:51 PM
User is offline View Users Profile Print this message



colinhaggett

Posts: 468
Joined: 08 July 2004

Originally posted by: daveparry1

Colin, partly because it means that we become unpaid tax collectors for the government and also it means we have to charge more for our work, whereas the "cash in hand" benefit collecting "tradesmen" can undercut us, (as they do now but more so!)


I suppose it depends on who you mainly work for. I tend to do newbuild and work for Company's who are VAT registered. Also it allows VAT to be reclaimed on the van, tools and fuel so has it's advantages. Plus am well over the 85k threshold so haven't got a choice.
 07 November 2017 10:02 PM
User is offline View Users Profile Print this message



daveparry1

Posts: 7745
Joined: 04 July 2007

I understand your position Colin, I was in a similar position when vat was first introduced, the limit was 5k then and I was well over that in a couple of months, I was in the car bodywork repair business in those days so was doing a fair bit of insurance work. I do mainly domestic work now so being vat registered would be no good to me.
 07 November 2017 10:48 PM
User is offline View Users Profile Print this message



Paradigm

Posts: 872
Joined: 10 September 2010

It's not that much of a major, there seems to be a real fear around it for some people.I have always been vat registered and nowadays with technology as it is, there are so many great book keeping software packages, it's easy to do your returns, keep track of your liability and no reason to get any grief from it.

The biggest problem i have found with it is people forgetting that the money isn't theirs and they spend it when they shouldn't.but that's a lack of discipline, same with income tax.

Nick

-------------------------
"be careful of what you write"
 07 November 2017 10:55 PM
User is offline View Users Profile Print this message



sparkingchip

Posts: 10107
Joined: 18 January 2003

Originally posted by: Blencathra

I am thinking of opening a bank on Lundy



If it is in the old lighthouse I bag the deck chair.

Andy B
 08 November 2017 07:23 AM
User is offline View Users Profile Print this message



davezawadi

Posts: 3905
Joined: 26 June 2002

Phillip Hammond is probably trying out the water, he wanted more NI from the self employed too, and that went down like a lead balloon. VAT registration does impose a levy of at least 10% on your labour charge, which would affect your competitive position a bit, but its not too serious in most situations. It does have a side effect, and that is that you are seen as being a properly registered business and not a fly by night operator, which can be good. BTW 10% comes from the charge but you reclaim some VAT on vehicles, fuel etc. The computer accounting is good but another significant cost to be put into the equation, as well as the time to enter every last tiny transaction.

-------------------------
David
BSc CEng MIET
david@ZawadiSoundAndLighting.co.uk
 08 November 2017 07:39 AM
User is offline View Users Profile Print this message



garywwess

Posts: 17
Joined: 03 April 2017

Vat is a pretty universal and accepted tax that no matter how disliked is never going away, I cant understand why anyone would think its fair to give a 20% margin of discount, to small businesses just because they don't fancy doing the extra paperwork.. and yes, we have lost many a quote too the "no vat on here " brigade... all we are asking for is a level playing field.. and not be penalised for running the business correctly.. VAT inclusion should be right there alongside PAYE and NATIONAL INSURANCE CONTRIBUTIONS.. (bet that ruffles a few feathers)
gary

gary
 08 November 2017 07:52 AM
User is offline View Users Profile Print this message



Paradigm

Posts: 872
Joined: 10 September 2010

Dave.

Most modern book keeping packages cost from around £10 to £20 a month. Hardly significant, especially when you take into consideration how much they save you on your time. That contradicts what you wrote on the first fix post regarding being efficient with how you do things.

I have manually kept books using traditional ledgers and spreadsheets and used proprietary software and it's not even a close race on time saved. Totally cheaper to use.

Secondly, you have to record your transactions whether you are vat rated or not, that data has to be recorded regardless and the software will do all the clever stuff like credit your vat liability accounts etc. It takes no more time whether you are vat rated or not to keep correct books. Me being vat registered compared to not vat registered probably has a time factor of about 15 mins a quarter ( the time it takes to file vat, print a return and file it online) and I am being over generous with that. I probably do it in less than 10 minutes.

You are immediately cheaper to commercial clients as they can reclaim all the vat on materials you supply and most builders are vat registered so no effect.

The only customer who it effects is domestic clients but it's the nature of being good at what you do. I am never short of work and I have a large domestic base.

-------------------------
"be careful of what you write"

Edited: 08 November 2017 at 08:12 AM by Paradigm
IET » Wiring and the regulations » Vat threshold

1 2 3 Next Last unread
Topic Tools Topic Tools
Statistics

New here?


See Also:



FuseTalk Standard Edition v3.2 - © 1999-2017 FuseTalk Inc. All rights reserved.

..