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Festival Cost plan (to VAT or not to VAT)

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Tom E View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Tom E Quote  Post ReplyReply Direct Link To This Post Posted: 18 February 2019 at 11:03pm
If you have hit the threshold for vat do not register until then.

It will cause more grief than its worth until you need to.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote csg Quote  Post ReplyReply Direct Link To This Post Posted: 19 February 2019 at 7:39am
nonsense, as written above it depends upon your business structure and circumstances / customer base. 
  This is one subject where professional advice is worthwhile over input from random forum members.
“The fact is this is about identifying what we do best and finding more ways of doing less of it better”
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Post Options Post Options   Thanks (0) Thanks(0)   Quote jacethebase Quote  Post ReplyReply Direct Link To This Post Posted: 19 February 2019 at 9:33am
Originally posted by Tom E Tom E wrote:

If you have hit the threshold for vat do not register until then.

It will cause more grief than its worth until you need to.

I am guessing your not VAT registered?

If you have decent account software and not a complete crackhead with money. I find being VAT registered helps more than the grief it causes.
The only grief it causes is with people that aren’t VAT reg have to pay an extra 20%
www.wedding-production.co.uk

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Post Options Post Options   Thanks (0) Thanks(0)   Quote APC321 Quote  Post ReplyReply Direct Link To This Post Posted: 19 February 2019 at 8:42pm
So a cost breakdown is being submitted to a small indie festival:

Sound system hire, van hire, diesel etc.


Why not submit a total price instead:

Sound system hire including delivery and engineer etc.


By breaking down the costs, it will just give the client an opportunity to pick off these costs individually, and push you down in price.

I think that it puts you in a better position if you a quote a single price for the job, saying what included and what is excluded.
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MattStolton View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote MattStolton Quote  Post ReplyReply Direct Link To This Post Posted: 21 February 2019 at 5:35pm
Robbo's mention of two company's, one vat reg, one not vat reg, has ben mooted to us by our accountant.

For trade to/from other VAT registered co's, you use the VAT registered company.

When dealing with, say, domestic dry hire, you use non vat reg co. Either you can make 20% more, or you can undercut someone else by up to 20%.


So currently a punter pays £120 inc VAT to dry hire something. Whatever co I launder it threw, they pay £120. If I launder it through Co.1 Vat Reg, I receive £100, HMRC get £20. If I process the same transaction through Co.2 Not Vat Reg, I get to keep all the £120.


However, when I buy my latest widget from PowerSoft or whatever, I need to buy it with Co.1 to reclaim VAT, and then do some weird fudge to transfer goods to Co.2, to allow them ownership in order to hire it out. Or Co.1 Hires it to Co.2 for a peppercorn rent...


However, both Co.1 and Co.2 need separate PLI, and both will get Corporation Taxed, and, much as I do my own VAT/Book Keeping, my end of year is done by my accountant, so second load of fees. And, as director of both, I need to deal with Companies House filings twice.....

Unless you like book keeping, and can trust staff to ring things through the correct till (second Card Machine account and costs...) starts looking like lot of effort for not really that much return.

Originally posted by APC321 APC321 wrote:

By breaking down the costs, it will just give the client an opportunity to pick off these costs individually, and push you down in price.

Definitely this.

I list everything, but provide no individual item prices. One final Total (+VAT). You are so right, that an arse of a client will try and pick you up on things that are critical and a couple of quid, and try and cut them. I still have an office copy which is fully itemised for my own workings out, but client should not see them.


Conversly, I do have a few clients where I do itemise everything, as their mindset is quite different, and unusual, as they just want to understand what everything costs. Very rarely do they quibble on price, they just need to take the prices to a committee and show exactly where it is all going. However they also know I am not fleecing them, as they a get the odd quote from someone else to keep me honest.

Horses for courses...
Matt Stolton - Technical Director (!!!) - Wilding Sound Ltd
"Sparkius metiretur vestra" - "Meter Your Mains"
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csg View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote csg Quote  Post ReplyReply Direct Link To This Post Posted: 21 February 2019 at 5:48pm
As far as i understand it, HMRC take a fairly dim view of two companies with very similar activities, run by the same director/s from the same premises ( even if different reg. offices) when it comes to lowering / avoiding collecting VAT on their behalf. At the end of the day, if it were allowable it would be a reasonable easy way to avoid any retail facing business, giving them a competitive advantage, not to mention lowering the VAT income to HMRC

Unless your name is Starbucks etc we have to play by the rules....

On a another note, lovely brown paper envelope from HMRC this morning reminding me as their "Dear customer" i have to file my VAT digitally from April. Since when was someone collecting tax on behalf of their government a customer?
“The fact is this is about identifying what we do best and finding more ways of doing less of it better”
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Post Options Post Options   Thanks (0) Thanks(0)   Quote wires Quote  Post ReplyReply Direct Link To This Post Posted: 21 February 2019 at 6:44pm
Originally posted by csg csg wrote:

As far as i understand it, HMRC take a fairly dim view of two companies with very similar activities, run by the same director/s from the same premises ( even if different reg. offices) when it comes to lowering / avoiding collecting VAT on their behalf. At the end of the day, if it were allowable it would be a reasonable easy way to avoid any retail facing business, giving them a competitive advantage, not to mention lowering the VAT income to HMRC

Unless your name is Starbucks etc we have to play by the rules....


Exactly this. Seems like a good way to get round things but will end up a nightmare if you plan on long term trading.

If you get investigated and they deem both companies even remotely similar in their trading activities, they will class them both as part of the registered company and then good luck with your tax bill... it’s not the 70’s anymore and the paper trail is a lot easier to follow for a small business.

If your business is mostly people and not companies and not over the threshold then stay basic non vat.
If you are trading in large amounts of goods, high turnover threshold or dealing mainly with products b2b then vat registered is a good call.

At the end of the day if you have to ask basic questions on a speaker forum about this then you really do need to talk to an accountant.


Edited by wires - 21 February 2019 at 6:45pm
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Post Options Post Options   Thanks (0) Thanks(0)   Quote concept-10 Quote  Post ReplyReply Direct Link To This Post Posted: 21 February 2019 at 8:04pm
What seems worse to me is buying you latest widget from Powersofts, that is a shed load of vat Smile
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MattStolton View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote MattStolton Quote  Post ReplyReply Direct Link To This Post Posted: 22 February 2019 at 4:56pm
Originally posted by csg csg wrote:

On a another note, lovely brown paper envelope from HMRC this morning reminding me as their "Dear customer" i have to file my VAT digitally from April. Since when was someone collecting tax on behalf of their government a customer?


Attempted my first MTD submission for VAT for Oct-Dec 2018. All looked good, with email receipt. Even paid before 7th Feb!

However, it has allocated it to the return for Jan-Mar 2019. FFS.

And it appears to HMRC, that I have failed to file a return for Oct-Dec 2018. I have had to fill out the "Corrections" form, which I have to print and post, as they can't receive it electronically.


You couldn't make it up.
Matt Stolton - Technical Director (!!!) - Wilding Sound Ltd
"Sparkius metiretur vestra" - "Meter Your Mains"
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