Do I need to get vat registered?

[Robert Elliott]

Hi all.
This year has been pretty hectic. Im a sole trader, Bricklayer with a couple of apprentices My turnover is looking at getting well over £85k.
In the past I have filled in my own self assessments and done my own accounting as my turnover has never really been over £45k.
As the financial year has started drawing to an end I've started looking at my books and I am starting to realise I may be in over my head.
Although I am meeting an accountant this week I wondered if anyone has any input? Am I looking at a big bill? Do i need to get vat registered? Are HMRC going to come for me!?

Any input really appreciated

Thanks
Rob.

 

[ecommerce84]

Hi Rob,

The first thing you need to assertain is exactly where you are with your turnover.

The turnover threshold is £85,000 as you suggest, but this isn’t done on a tax year basis, it’s done on a rolling 12 month basis.

Go back and look at your turnover from 1st February 2018 - 31st January 2019 (12 months).

If it’s over £85k, you need to register and you need to find at what point your rolling 12 month turnover went over.

If it’s under 85k, but you think it will go over in the next 30 days you need to register.

Either way I would wait until you speak to your accountant to actually register but have this information ready for when you do go and speak to them.

The good news if this that HMRC are unlikely to ‘come for you’. If you should have registered months ago, you will face a fine and have to pay VAT on past sales, and possibly make yourself more likely to be subject to inspection in the future. You won’t end up in jail though!

What you do need to do though is increase the frequency you do your bookkeeping. To only start to look at them now for sales since April doesn’t compute in my mind! Mine are currently up to date to Friday. I’m not saying you have to do them as frequently as me, but certainly once a week or fortnight.

 

[Robert Elliott]

Thanks for your reply.
The last 12 months have been manic and I hate to admit I have no books.
I had a house fire last March which gutted everything and we spent 12 weeks in a hotel. And 4 weeks living in our living room.
To add insult to injury my wife and I had several separations and then 3 weeks ago I had my van stolen(which I was using at the time as an office)

I'll have to tot up my past 12 months earning and discuss this further with an accountant next week.

I appreciate all this is but excuses for my sloppiness.

Thanks again for your reply.

 

[MyAccountantOnline]

Rob you are doing the right thing in seeing an accountant - he/she really should be able to deal with all that's required.

In the meantime reading this may help.

 

[spidersong]

Two things:
One this bit might be a bit misleading "If it’s under 85k, but you think it will go over in the next 30 days you need to register." you'll only need to register once you actually go over the £85K, the 'forward look' only applies where you will turnover £85K in the next 30 days alone.

So if you go over in the next 30 days (sometime in Feb) on the rolling 12 months then you'd have until the end of March to tell HMRC and then you'd be registered from 1st April.

The other thing is what type of bricklaying do you do; if it's all domestic new build then your services are zero rated so you might be better off being registered and claiming VAT on costs back. If it's commercial sub contract then the likelihood is your clients can recover the VAT so again it might be worth your while to register. If it's domestic repairs/extensions etc. or work for smaller businesses then you may need to look at your pricing carefully as you'd need to be charging an extra 20% that your clients may not be able to recover.