Vat flat rate and goods

[ukbusinessowne]

Hi,

Is anyone meeting the 2% spend rule for flat rate vat? Do you have examples of legitimate office supplies and stationery to meet the flat rate vat rules?

I.e. are branded pens under advertising, or do they fall under stationery?

Are expensive pens legitimate stationery spend?

How about books?

I've read some people are including brochures. Do brochures and business cards meet the rules.

Thanks

 

[MyAccountantOnline]

Hi,

Is anyone meeting the 2% spend rule for flat rate vat? Do you have examples of legitimate office supplies and stationery to meet the flat rate vat rules?

I.e. are branded pens under advertising, or do they fall under stationery?

Are expensive pens legitimate stationery spend?

How about books?

I've read some people are including brochures. Do brochures and business cards meet the rules.

Thanks

Have a read of the HMRC guidance notice here starting at section 4.4 - it lists the costs

Flat Rate Scheme for small businesses (VAT Notice 733)

Find out how to use the Flat Rate Scheme, who can use it and how to apply to join the scheme.

www.gov.uk

 

[ukbusinessowne]

Thanks yes I'm aware stationery and office supplies are legimate expenses to meet the 2% of turnover rule. What I'm not sure about is the definition of office supplies, i.e. can you buy branded pens etc or does that come under advertising. Same with business cards, leaflets etc, are they legitimate office supplies or are they 'advertising' and hence don't count. I presume there is nothing to stop people from buying expensive pens too.

 

[MyAccountantOnline]

If you have a read of the link it lists relevant goods and also lists those which aren't included, one of which is

''goods for disposal such as promotional items, gifts or donations''

You need to be careful buying goods again in the link it does say it excludes -

''goods which are bought solely to meet the test, as these would not be used exclusively for the purposes of your business, for example, if the quantity of goods being bought cannot reasonably be used by the business and are simply ‘stockpiled’ or thrown away, even if the business may normally use those items is smaller quantities such as office materials''

 

[ukbusinessowne]

Ok thanks, very hard to say from one year to the next what will be used and won't to be honest, even with the best will in the world. Just wondered re brochures as I've read elsewhere that some people are counting these as a legitimate expenses towards the 2%. Also this year we have bought a couple of expensive pens, but I suppose they may come under the gifts category so not count towards office supplies and stationery.

I'm trying to figure out what in our expenses can legitimately count as part of the 2%

 

[MyAccountantOnline]

Ok thanks, very hard to say from one year to the next what will be used and won't to be honest, even with the best will in the world. Just wondered re brochures as I've read elsewhere that some people are counting these as a legitimate expenses towards the 2%. Also this year we have bought a couple of expensive pens, but I suppose they may come under the gifts category so not count towards office supplies and stationery.

I'm trying to figure out what in our expenses can legitimately count as part of the 2%

It really is worth reading through the guidance carefully and making sure none of the exclusions apply.

 

[lesvatadvice]

Office supplies, whether branded or not, are relevant goods. Advertising 'services' are different. (Goods are not services!)
You are right to ask the questions. I would recommend you make sure you are well over the 2% threshold, so, if HMRC were to re-categorise any expenditure, you would not fall into the LCT regime.

 

[ukbusinessowne]

Office supplies, whether branded or not, are relevant goods. Advertising 'services' are different. (Goods are not services!)
You are right to ask the questions. I would recommend you make sure you are well over the 2% threshold, so, if HMRC were to re-categorise any expenditure, you would not fall into the LCT regime.

Thanks, that's worth knowing that branded pens etc count towards the total 2%. I was wondering as I had read something similar elsewhere.