Scandially
Well-Known Member
Just ordered a new Hilux InvX and i was wondering if i could register for VAT and claim the VAT back and then de-register?
VAT
- Thread starter Scandially
- Start date
No
Scandially
Well-Known Member
I am self employed earning less than required to be VAT registered.
No you can’t, just put the purchase of the truck against your tax
Vat is not worked out on earnings it's done on turn over.
You can voluntarily vat register regardless of your earnings being below the vat threshold, however their are rules about registering and then immediately deregistering to stop what you suggested.
Norfolk Horn
Well-Known Member
If you register for vat to reclaim you will be expected to charge vat on good and services if applicable, therefore you will either be in a position were you have to increase your prices or absorb the cost unless your customers are vat registered so they can claim it back
Years ago when I went self employed and I did nothing but new build I registered as I was buying a new van and numerous power tools so it was a benefit to me to do so even though my turnover didn't make it compulsory
Years ago when I went self employed and I did nothing but new build I registered as I was buying a new van and numerous power tools so it was a benefit to me to do so even though my turnover didn't make it compulsory
You might be self employed, but you can voluntary register for VAT, even though you are under the threshold. However you cant register and then den register just to purchase a new truck. You will have to bite the bullet like I recently did with my new truck.
If you have a good accountant they will take off the depreciation value every year against any earnings.
If you have a good accountant they will take off the depreciation value every year against any earnings.
Heym SR20
Well-Known Member
No reason why you should not register for VAT if you are under the VAT threshold. And may reclaim the VAT for vehicles etc that you use in your business alongwith other running costs. However if you use you vehicle for personal use, you then need to charge yourself for that personal use.
And you do need to be reasonable - are really using the pickup for your business. So for example I am in finance, and couldn’t justify running a pickup for business use.
You can however have a personal vehicle, and charge business mileage at £0.45 per mile to your business. There are now many apps that link straight to Xero, quickbooks etc which make this easy. Doing a business trip - turn it on and record.
HMRC are well used to most of the tricks on VAT. You really do not want to get a VAT or tax inspection on your business as it is a costly and embuggerance filled process.
For VAT for small businesses / self employed there is the Flat Rate Scheme whereby you charge your customers VAT at 20%, but then depending on which sector you are in you pay a flat rate of say 12% of your turnover. HMRC have averaged out the costs for most small trades / sectirs.
This does make VAT returns very easy as you don’t have to account for every little expense etc.
However for your annual tax return you do - quite why they can’t do a flat rate scheme for tax as well rather beats me. It would be very simple, and save endless hours of embuggerance and cost for lots of sole traders.
And you do need to be reasonable - are really using the pickup for your business. So for example I am in finance, and couldn’t justify running a pickup for business use.
You can however have a personal vehicle, and charge business mileage at £0.45 per mile to your business. There are now many apps that link straight to Xero, quickbooks etc which make this easy. Doing a business trip - turn it on and record.
HMRC are well used to most of the tricks on VAT. You really do not want to get a VAT or tax inspection on your business as it is a costly and embuggerance filled process.
For VAT for small businesses / self employed there is the Flat Rate Scheme whereby you charge your customers VAT at 20%, but then depending on which sector you are in you pay a flat rate of say 12% of your turnover. HMRC have averaged out the costs for most small trades / sectirs.
This does make VAT returns very easy as you don’t have to account for every little expense etc.
However for your annual tax return you do - quite why they can’t do a flat rate scheme for tax as well rather beats me. It would be very simple, and save endless hours of embuggerance and cost for lots of sole traders.
