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Vat question

They are your prices so of course you can lower them.

However

your now out of pocket £16.67 Because you have to give that to HMRC

But If your mostly Business to Business the you'll charge £100 + vat. The other business wont be bothered at all IF they are VAT registered as They'll just claim the £20 (the +VAT part) back.

Being VAT registered also means you pay nearly 30p per litre less for your business fuel.
 
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I was going to post something useful but I still can't figure out what the OP/OP's accountant has done.

It still looks like he has paid vat on £500,000 (£100,000) and only made £50,000 so he has lost £50,000 per annum and he hasn't noticed?
 
The OP did say those figures were for Illustration only. But still.

I fail to see how anyone can pay more VAT than is owed. (other than NOT counting output VAT)

The OP should only have Invoices (in his name)with VAT on them for the commission only. Why would the accountant be using another companies Invoices.

I dont think we can help unless we get a story thats closer to the truth.

You pay VAT every quarter so the OP has sent money off to HMRC 4 times and NOT noticed the discrepancy
 
mattyg said:
The OP did say those figures were for Illustration only. But still.

I fail to see how anyone can pay more VAT than is owed. (other than NOT counting output VAT)

The OP should only have Invoices (in his name)with VAT on them for the commission only. Why would the accountant be using another companies Invoices.

I dont think we can help unless we get a story thats closer to the truth.

You pay VAT every quarter so the OP has sent money off to HMRC 4 times and NOT noticed the discrepancy
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I agree, they may be for illustration but whatever the figures, the vat has been paid over on much larger invoices than his commision hence he will have been paying more vat than he earned.

I fail to see how this has happened.
 
dnc316 said:
Can I lower my prices to accomodate my now incured VAT? E.g. if I charge £100 a day and then become VAT registered, I could change my prices to £83.33 a day. That way I'm only gaining from claiming VAT on my expenses.



I mainly supply services to VAT registered business. Sometimes to non-VAT registered. It's probably an 80-20 split.
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Go see an accountant. If your non VAT registered customers won;t swallow then increase from £100 to £120 then it all comes down to how much vat you will be reclaiming on your expenses to offset the drop to £83.33 for your private customers. It could still be worthwhile but it's on an individual basis.

In my gf's case it was, and she made £1,000 to £2,000 per annnum extra from being vat registered (especially on a very generous flat rate scheme which has a 1% discount for the first year)
 
The larger figure should never have been discussed with the accountant. Like I said previous I dont/cant disclose any of my customers turnover.

All the accountant needs is what you do and whats related to your business.

And that would be the "£50k"
 
mattyg said:
They are your prices so of course you can lower them.

However

your now out of pocket £16.67 Because you have to give that to HMRC

But If your mostly Business to Business the you'll charge £100 + vat. The other business wont be bothered at all IF they are VAT registered as They'll just claim the £20 (the +VAT part) back.

Being VAT registered also means you pay nearly 30p per litre less for your business fuel.
Click to expand...

Greebo said:
Go see an accountant. If your non VAT registered customers won;t swallow then increase from £100 to £120 then it all comes down to how much vat you will be reclaiming on your expenses to offset the drop to £83.33 for your private customers. It could still be worthwhile but it's on an individual basis.

In my gf's case it was, and she made £1,000 to £2,000 per annnum extra from being vat registered (especially on a very generous flat rate scheme which has a 1% discount for the first year)
Click to expand...

Thanks, very helpful. (It's me, dnc316, I just changed my name...)
 
No mattyg the invoices that were sent from corp were given to accountant which contained both figures but because the way commission is paid to travel agents (12 weeks from holiday date regrdless of when its paid in full) makes it very difficult to work out cash flow, we assumed it was due to being a new business and not buying much to offset the vat we were paying
 
Hang on I'm mega confused. What has the Invoices from the Corp got to do with it. Unless they were Invoices to you (They were charging YOU for something) Or are they self billing invoices.

I'll say it again though.

You only pay VAT on Invoices YOU have raised.

Do you not Invoice the corp for your commision?

Sorry if I'm sounding negative.(not meaning to) I'm just struggling to get my head around how this may have happened. As again you only pay VAT on Invoices YOU have raised. (self billing is different)

I'm sure its sortable.

But you need to work out who's cockup it is so it doesn't happen again.

How often were you paying HMRC
 
OP, I think you need to specify, in detail, exactly what your situation is. If you want people to help you can't keep trickling information out in dribs and drabs.
 
You need to look into the agent VAT schemes.

If you're selling the holiday on behalf of the larger company and the customer knows this, then you can act as a disclosed agent and just pay the VAT on the profit you make (commission).

If the customer thinks they are buying the the holiday direct from you though, then you are acting as a non-disclosed agent and have to charge VAT on your sale and pay it to the tax man.

I'm still looking into the above myself so might not have my facts completely straight but there are other schemes available for companies which effectively have no VAT to claim back on their goods.

Might be worth calling the VAT helpline, or post one of the many tax forums.
 
The question you still haven't answered is who do you invoice and for what? Give us a specific example.

Do you refer customers onto the travel provider for a fee or do you sell the holiday to the customer and purchase it from the travel provider?

What do your accounts say your turnover is?
 
Claims for VAT after deregistration are made on form VAT427, obtainable from the VAT Helpline. Completed forms should be sent, together with original invoices, to:

HM Revenue & Customs
Accounting Adjustments (VAT427 team)
3rd Floor South
Queens Dock
Liverpool
L74 4AA

Claims should be made as soon as possible after cancelling your registration. Any payment due to you could be delayed if your business bank account has been closed.
 
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