Despite never supplying materials on decent jobs, I've been on the edge of the VAT threshold for 2 years. I'm always 'too' busy and it's preventing me from taking anyone on to work alongside, due to other trades warning me off going VAT registered!
My apprentices wage will go up later in the year and looking at last years turnover I'd have to do some serious dodging about to prevent going over the threshold.
My accountant says 'do it or take less on', and has advised that I should register for the new tax year coming up. Some builders say 'why aren't you already registered' (they are themselves vat registered), some say avoid at all costs as they have priced themselves out of work before and they have de-registered because of the hassle?
I calculated that after being able to claim back on overheads etc I would have to put my labour charge up about 10% (which as I understand would only affect non-vat clients who couldn't claim back). Currently I rarely price a job that I don't get. I've never looked into this too much before but I just can't see how its fair that someone with a bigger turnover HAS to legally increase their price to non-vat customers by adding VAT, forcing them to lose work to someone who isn't vat registered for whatever reason! (Obviously this scenario has worked in my favour up to this point).
Most of my existing regulars are non-vat unfortunately, but I know that I have lost out on work in the past by not being registered.
On big jobs for VAT clients they've opened their own accounts to be able to claim the VAT back on gear themselves, so I've never been able to make anything on supplying materials.
I can see there are pros and cons but surely the only winner is HMRC.
What are others experiences on this forum? I'm stuck as to what I should do
My apprentices wage will go up later in the year and looking at last years turnover I'd have to do some serious dodging about to prevent going over the threshold.
My accountant says 'do it or take less on', and has advised that I should register for the new tax year coming up. Some builders say 'why aren't you already registered' (they are themselves vat registered), some say avoid at all costs as they have priced themselves out of work before and they have de-registered because of the hassle?
I calculated that after being able to claim back on overheads etc I would have to put my labour charge up about 10% (which as I understand would only affect non-vat clients who couldn't claim back). Currently I rarely price a job that I don't get. I've never looked into this too much before but I just can't see how its fair that someone with a bigger turnover HAS to legally increase their price to non-vat customers by adding VAT, forcing them to lose work to someone who isn't vat registered for whatever reason! (Obviously this scenario has worked in my favour up to this point).
Most of my existing regulars are non-vat unfortunately, but I know that I have lost out on work in the past by not being registered.
On big jobs for VAT clients they've opened their own accounts to be able to claim the VAT back on gear themselves, so I've never been able to make anything on supplying materials.
I can see there are pros and cons but surely the only winner is HMRC.
What are others experiences on this forum? I'm stuck as to what I should do
