Need to become VAT registered

[inca training services]

Hello all, I was wondering if I could pick your brains?!!?
I am a nationwide health and safety training provider, Sole Trader, and in the process of filling out a tender for a government contract. One of the requirements is that we are VAT registered. I believe this is fairly easy to set up, however if I was to set up as VAT registered now, would this affect invoices/orders I already have in place for future courses? Or do I have to amend them with VAT added?

Also, once I am VAT registered can I claim back VAT on all business purchases I have made in the last 6 months?

 

[elaine@cheapaccounting]

After vat reg you need to apply vat to all sales.

Yes you can claim back vat prior to vat reg as follows:


http://www.hmrc.gov.uk/vat/start/register/purchases-before.htm


and here is what to do on invoicing:

http://www.hmrc.gov.uk/vat/start/register/waiting.htm

 

[RobBellAutus]

Hi Inca,
Whatever you do time-wise (i.e. backdate or not), you need to apply equally to your sales and your purchases.
You need to think about whether you wish to opt for cash accounting scheme (i.e. pay & reclaim VAT only when your invoices are paid, or you pay your expenses - as opposed to an accruals basis).
You also need to think about whether it will be beneficial for you be on a flat rate scheme (FRS), which makes admin easier - this is likely to be especially worthwhile if your expenses are low in relation to income.
Have a look here: http://www.hmrc.gov.uk/vat/start/schemes/index.htm
Regards
Rob

 

[MyAccountantOnline]

You also need to think about whether it will be beneficial for you be on a flat rate scheme (FRS), which makes admin easier - this is likely to be especially worthwhile if your expenses are low in relation to income.
Have a look here: http://www.hmrc.gov.uk/vat/start/schemes/index.htm
Regards
Rob

Thats not easy as HMRC have still not announced what the Flat Rate percentages will be from 1 January!

 

[elaine@cheapaccounting]

Thats not easy as HMRC have still not announced what the Flat Rate percentages will be from 1 January!

Should be available this week after PBR - we hope!

 

[David Griffiths]

Thats not easy as HMRC have still not announced what the Flat Rate percentages will be from 1 January!

But they have said that they will be broadly in line with their 2007 levels, so there is information to make a comparison. The exact rates will be announced later this month - "towars the end of 2009" to be precise!

 

[MyAccountantOnline]

But they have said that they will be broadly in line with their 2007 levels, so there is information to make a comparison. The exact rates will be announced later this month - "towars the end of 2009" to be precise!

Lets just hope they keep to what they say...not something that can be replied upon. But yes I agree a judgement can be made based on the current rates.

 

[elaine@cheapaccounting]

Well let's see how they plan to pay for the bankers

Will VAT ever be the same - Take Vat

 

[spidersong]

I'd just put a quick caveat up here, on charging VAT and whether you can recover things.

You need to be sure exactly what your liabilities are. Many training supplies made by a sole proprietor can be exempt from VAT, which means you don't necessarily charge VAT to everyone and if you don't do that you cannot necessarily claim back all the VAT you incur.

If you are a sole trader then any training you deliver in subjects which can ordinarily be taught in a school or university is going to be exempt. Now I'm not sure what you actually do in 'Health and Safety Training' but if any of it could be learnt in a school or university in the UK then you may have some VAT issues to look at.

Also your government contract might not have any VAT on it, in which case requiring you to be registered is just a nonsense designed to make your life harder!

 

[inca training services]

Apologies for the delay in replying. Thanks all very much for your advice. I will certainly have a look at all options.

Thanks again