Printing Costs and not VAT registered

[den]

Hi All,

Just wondering what you guys do in this situation and any advice would be great.

Here's the story.

I am in full time employment but I do freelance on the side. All legit and have registered with an accountant to do my tax returns etc.

On my second job as freelancer I'm not VAT registered so when clients ask me to design and print etc I have to pass the VAT from the printers onto them as no printer will print anything without an account or upfront payment. I never state anything to do with VAT on my invoices.

Is there anyway around this or is anyone else in a similar situation? Is it worth me registering as VAT registered. I don't earn a great deal on the second income.

Thanks in advance.

[Minuteman Press]

Hello Den,

What is your current / short term expected turnover?

Also - what items are you having printed that attract VAT - NB not all printed items attract VAT - make sure the items you are having printed do attract VAT - see here - HMRC.

Hope this helps (or is at least a start).

[den]

Hello Den,

What is your current / short term expected turnover?

Also - what items are you having printed that attract VAT - NB not all printed items attract VAT - make sure the items you are having printed do attract VAT - see here - HMRC.

Hope this helps (or is at least a start).

Thanks for the reply Minuteman.

My expected turnover is probably about 10k max.

The things I get asked to get printed are usually:

Business Cards
Comp Slips
Brochures
Posters
etc..

Things like that.

[Boss Hog]

Without registering for VAT there is nothing you can do to claim it back and hence this will be passed to your client in your quote, they can't claim it back either as you are not issuing a VAT invoice. No way around it unfortunately, but as Peter says not everything is VAT rated.

[den]

Without registering for VAT there is nothing you can do to claim it back and hence this will be passed to your client in your quote, they can't claim it back either as you are not issuing a VAT invoice. No way around it unfortunately, but as Peter says not everything is VAT rated.

Thanks for your reply.

In your opinion and in my situation only doing this as a second income do you think I should register for VAT?

Thank you for your help.

[Katedesign]

It could be worth it if you are also buying things (paper, inks, toner, machinery etc) as you could set it against VAT. Ask your accountant!

[Minuteman Press]

You are well below the VAT threshold.

Apart from brochures (if they are true brochures), all of the items mentioned are subject to VAT.

With a small turnover your VAT element would not justify regitration. My advice - wait and grow.

You'll need to absorb VAT in your costs or pass on some all in the price (which as Boss H says - cannot be recharged as VAT).

[Boss Hog]

It also depends what type of business you think will be dealing with, small/start-up businesses are not usually VAT registered anyway so they will be in the same situation as you.

[leedsprintingco]

Hi,

There are two options as i see it,

1. Absorbs the VAT charged to you, and roll it in to your retail cost

2. Voluntarily register for VAT.

If you register to pay flat rate VAT and use the annual accounting scheme, it is possible to make a profit on your VAT. You would charge VAT @ 20 % but under the flat rate scheme you would only have to file your returns based on 7.5% of turnover. However a consequence of this scheme is you cant reclaim expenses.

It certainly worth investigating this scheme!

[SparkCreative]

Hi,

There are two options as i see it,

1. Absorbs the VAT charged to you, and roll it in to your retail cost

2. Voluntarily register for VAT.

If you register to pay flat rate VAT and use the annual accounting scheme, it is possible to make a profit on your VAT. You would charge VAT @ 20 % but under the flat rate scheme you would only have to file your returns based on 7.5% of turnover. However a consequence of this scheme is you cant reclaim expenses.

It certainly worth investigating this scheme!

This. The flat rate scheme is great for designers, because there's very little you buy in, so you wouldn't be claiming a lot of VAT back anyway. Although it's 10% you have to pay, not 7.5%. (I'd check that if I was you LPC!) I pass most of my print invoices directly to the client. And you can still claim back on IT equipment, which is my only real big expense.