To Register for VAT or Not

[numbersrule]

I am a ground investigator and following a quieter than normal year, I started to train in an unrelated occupation and will soon be in a position, all being well, to start providing services via my new second business which employs me in the unrelated occupation.

My first business is VAT Registered.

My second business is unlikely to meet the VAT Threshold for the foreseeable future because the intention is to fill in gaps in my time following the quieter year which is now becoming more than a year.

So is there any reason to Register my second business for VAT anyway?

The VAT on my Cost of Sales will be minimal ( say <5% of Sales ).

It seems that the only reason for me to charge VAT would be for added credibility with some Clients.
But that would be an extra VAT cost to those other Clients who are not VAT Registered and might put them off.

I suppose I am comparing failing to gain some Clients with not being able to reclaim the Input VAT.

If I didn't Register for VAT would HMRC be concerned about me having a second business which isn't VAT Registered even though the first one is?

I have no issue Registering as I find VAT a doddle on Xero.

Thanks

 

[MRQ]

...May we assume these businesses are 'ring fenced' as limited companies; as opposed to you simply being a sole trader?

 

[numbersrule]

...May we assume these businesses are 'ring fenced' as limited companies; as opposed to you simply being a sole trader?

Yes, both are Ltd