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Flat rate vat - paying too much?

Discussion in 'General Business Forum' started by mm60103, Feb 5, 2011.

  1. mm60103

    mm60103 UKBF Newcomer Free Member

    Posts: 6 Likes: 1
    My small limited company has been flat VAT registered for about 7 years. I work as an electrical engineer designing and specifying equipment. I think I've been over paying on the flat rate vat. Last year I was paying 12% and I find out now many of the ex umbrella type companies now operating as accountants were recommending 10.5%. The VAT has now changed and its looks as though I need to go from 13% to 14.5% whereas the others seem to be lifting from 10.5% to 12%.

    Because I've been operating like this for a few years now am I stuffed with the higher rate.

    My next VAT return is due is it worth just dropping both figures.

    The HM site goes on about architects and civil engineers - these attract the higher rate whereas other engineers surely should attract the lesser figure.

    Any thoughts.
     
    Posted: Feb 5, 2011 By: mm60103 Member since: Feb 5, 2011
    #1
  2. Scalloway

    Scalloway UKBF Legend Free Member

    Posts: 9,934 Likes: 2,264
    Have you listed all your sales and input VAT to see if you are better off on the fixed rate? That would be my first step.
     
    Posted: Feb 5, 2011 By: Scalloway Member since: Jun 6, 2010
    #2
  3. mm60103

    mm60103 UKBF Newcomer Free Member

    Posts: 6 Likes: 1
    I'm definately better off on the flat rate scheme. My company doesn't make purchases or scarce few and its essentially a service type contract.

    My issue is that the description on the VAT site is vague. I think I've been overpaying. Would you just change the flat rate or would you get in touch with the VAT man. If I speak with the VAT man he will give me an answer which I believe will fall in his favour. Without asking him I am genuinely working in ignorance.

    If I simply changed the rate and made myself a decent saving how often does the vat man check things and is he likely to come looking. VAT will be paid its just the amount of VAT in question.
     
    Posted: Feb 6, 2011 By: mm60103 Member since: Feb 5, 2011
    #3
  4. Scalloway

    Scalloway UKBF Legend Free Member

    Posts: 9,934 Likes: 2,264
    The VAT office may well do a check on your figures when they receive the return. Any discrepancy will trigger a VAT inspection.
     
    Posted: Feb 6, 2011 By: Scalloway Member since: Jun 6, 2010
    #4
  5. Bob

    Bob UKBF Big Shot Free Member

    Posts: 3,670 Likes: 928
    Does this help ?
     
    Posted: Feb 6, 2011 By: Bob Member since: Jul 24, 2009
    #5
  6. eggtastico

    eggtastico UKBF Newcomer Free Member

    Posts: 10 Likes: 1
    xxx.hmrc.gov.uk/vat/start/schemes/flat-rate.htm#5

    hope that is of some help. - i cant post links yet, I dont have enough posts
     
    Posted: Feb 14, 2011 By: eggtastico Member since: Feb 12, 2011
    #6