VAT-FRS

[reachbesal]

Hi All

I have a limited company and started trading from Jan 2018 and we were not VAT registered at that time.

Recently I came to know about VAT-FRS and registered for it yesterday, hopefully within few days I will get the VAT registration number.

The question is following

1) when I registered for VAT (FRS) on the HMRC website, there was a section
Date of Registration - From what date do you want the business to be registered
I selected that date when we started trading , i.e 2 Jan 2018 when we got our first client.
However we didn't bill our client any VAT till now, so the date of 2nd Jan 2018 , was it correct? or does it need to be the date in the future when were expecting to bill our future clients with 20% VAT?

2) Because I selected 2nd of Jan 2018, can I re-invoice my client with 20% VAT or do I need to get the VAT registration number before I start billing VAT.

3) There was a selection in the HMRC VAT registration form , VAT Return Frequency, I selected (March, June, Sep and Dec). Since we are in April and I only registered it yesterday (VAT-FRS), do I need to submit VAT Return as I dont have any returns for the first quarter (Jan,Feb and March) where we didn't bill VAT as we were not registered for VAT, do we need to declare this to HMRC that we dont have any VAT claims?

Many thanks in advance for your advice.

Regards

 

[MyAccountantOnline]

Hi All

I have a limited company and started trading from Jan 2018 and we were not VAT registered at that time.

Recently I came to know about VAT-FRS and registered for it yesterday, hopefully within few days I will get the VAT registration number.

The question is following

1) when I registered for VAT (FRS) on the HMRC website, there was a section
Date of Registration - From what date do you want the business to be registered
I selected that date when we started trading , i.e 2 Jan 2018 when we got our first client.
However we didn't bill our client any VAT till now, so the date of 2nd Jan 2018 , was it correct? or does it need to be the date in the future when were expecting to bill our future clients with 20% VAT?

2) Because I selected 2nd of Jan 2018, can I re-invoice my client with 20% VAT or do I need to get the VAT registration number before I start billing VAT.

3) There was a selection in the HMRC VAT registration form , VAT Return Frequency, I selected (March, June, Sep and Dec). Since we are in April and I only registered it yesterday (VAT-FRS), do I need to submit VAT Return as I dont have any returns for the first quarter (Jan,Feb and March) where we didn't bill VAT as we were not registered for VAT, do we need to declare this to HMRC that we dont have any VAT claims?

Many thanks in advance for your advice.

Regards

To answer your questions -

1. Assuming you made a voluntary registration you can choose the date. It can be before your first client was invoiced.

2. You will need to account for VAT on all sales made from the date of registration. Have a read at the bottom of the page here https://www.gov.uk/vat-registration

3. HMRC will advise you of the dates of your first VAT return. The first VAT return is generally for a longer period. If you have no VAT to pay or recover you will still need to submit a nil Return.

 

[reachbesal]

Thanks Nicola for your reply. You are correct , I made a voluntary registration.

After reading the link you provided, as I was not registered for VAT and all the previous invoice From Jan to April I cant bill my clients VAT. That is clear now .
Once I get my VAT registration number , I will bill VAT for the future invoices.

Hopefully there would not any penalties from HMRC because I selected 2nd of Jan 2018 (date of registration) and I cant submit the nil Vat return (last quarter) till I get VAT number.

For VAT returns, Is it OK if I submit £0 for the the last quarter (Jan-Mar) as I dont have any return claims ?


Regards

 

[Anna Chandley]

I think you may have misunderstood what the VAT notice was saying. As you chose a registration date of 2nd Jan 2018 you will be treated as being registered for VAT from 2nd Jan 2018 and all invoices issued on or after 2nd January 2018 are subject to VAT.

The VAT due for the last quarter (jan- Mar) is unlikely to be nil as there were invoices issued in this period. (although its more likely that the first VAT return will cover the period from 2 Jan 2018 to 30 June 2018)

 

[MyAccountantOnline]

Thanks Nicola for your reply. You are correct , I made a voluntary registration.

After reading the link you provided, as I was not registered for VAT and all the previous invoice From Jan to April I cant bill my clients VAT. That is clear now .
Once I get my VAT registration number , I will bill VAT for the future invoices.

Hopefully there would not any penalties from HMRC because I selected 2nd of Jan 2018 (date of registration) and I cant submit the nil Vat return (last quarter) till I get VAT number.

For VAT returns, Is it OK if I submit £0 for the the last quarter (Jan-Mar) as I dont have any return claims ?


Regards

You can include VAT in your charges whilst you are waiting for your VAT registration number but you mustn't refer to it in anyway as VAT.

If you have no VAT to pay or recover you do indeed just submit the VAT return with £0's on it.

 

[reachbesal]

Many thanks for your reply Anna and Nicola.

So far (before registering for VAT) all the invoices (to client) were made out without VAT and paid into my business bank account

May I please ask for your advice, whats the best way to get the VAT from the client (they are VAT registered company) for the last 3 months when I was not registered, they did ask me if I was registered for VAT in Jan 2018 before we started billing, I told them I am not registered and since then from Jan till Now, all invoices are without VAT.

To get the VAT back for the last 3 months

1) Should I rebill them with VAT from Jan-March?
or
2) Should I put a new bill stating its for VAT for the last quarter?

Kind Regards

 

[MyAccountantOnline]

Many thanks for your reply Anna and Nicola.

So far (before registering for VAT) all the invoices (to client) were made out without VAT and paid into my business bank account

May I please ask for your advice, whats the best way to get the VAT from the client (they are VAT registered company) for the last 3 months when I was not registered, they did ask me if I was registered for VAT in Jan 2018 before we started billing, I told them I am not registered and since then from Jan till Now, all invoices are without VAT.

To get the VAT back for the last 3 months

1) Should I rebill them with VAT from Jan-March?
or
2) Should I put a new bill stating its for VAT for the last quarter?

Kind Regards

Is your client happy to pay the VAT on top of what they've already paid you?

 

[reachbesal]

Thanks Nicola

TBH, I have not asked them, but if they say they say "yes" how can I bill them for VAT for the last 3 months.

 

[Scalloway]

how can I bill them for VAT for the last 3 months.

Send them a bill for VAT only.

Or to do it more correctly send them a credit note cancelling your original invoice plus a new invoice including VAT.

 

[reachbesal]

Thanks Scalloway

 

[MyAccountantOnline]

Thanks Nicola

TBH, I have not asked them, but if they say they say "yes" how can I bill them for VAT for the last 3 months.

This is what HMRC tell you to do (taken from the HMRC website) -

While you wait
You can’t charge or show VAT on your invoices until you get your VAT number. However, you’ll still have to pay the VAT to HMRC for this period.

You should increase your prices to allow for this and tell your customers why. Once you’ve got your VAT number you can then reissue the invoices showing the VAT.

That's what I'd do.

 

[SteveHa]

Why have you voluntarily registered for the VAT Flat Rate Scheme?