VAT Off-License

[mwt.taylor88]

Hi,

Im looking at the possibility of setting up an off-license. Im trying to get my head round VAT.

Do I:-
- Pay 20% of alcohol revenues to the tax man.
- Reclaim 20% of cost of alcohol goods.

Also is it right that I don't have to registeer for VAT until I turnover £76k? This means is paid or reclaimed until I have turned over £76k first year.

Many Thanks

 

[lesvatadvice]

The turnover limit is currently £81,000 p.a. You are not obliged to register until you reach that figure.
Once registered, your net VAT payable is the difference between input tax (paid on purchases) and output tax (on your sales).
You should speak with an Accountant or Bookkeeper to work through the basics of VAT and record keeping, etc.

 

[StevensOnln1]

If you become VAT registered you will charge VAT at 20% on on all your sales of standard rated goods (not just alcohol). You will reclaim VAT paid on all of your purchases. The difference is paid to HMRC each quarter.

The VAT registration threshold is currently £81,000 in any 12 calendar month period.