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V.A.T how does it affect business?

Discussion in 'Trade Talk' started by upstairscharly, 28 Sep 2012.

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VAT is a benefit securing work?

Poll closed 13 Jun 2015.
  1. Yes

    3 vote(s)
    42.9%
  2. No

    4 vote(s)
    57.1%
  1. upstairscharly

    upstairscharly

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    Yes the dreaded tax. The question is though, being VAT registered does it attract work more than repel? Or is it just a blight on securing jobs?

    For example: If Mrs X receives a non VAT registered quote 20% less than another firms, will she be thinking "fantastic I've saved hundreds!" or will she be thinking "Their not VAT registered, why aren't they & do they actually carry out much work".

    Any thoughts?

    EDIT: Mrs X is just a non VAT registered private customer. Does she trust a VAT registered installer more or is the savings made by not choosing a VAT registered company far outweighing her concerns of choosing a non-VAT registered installer.
     
  2. FiremanT

    FiremanT

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    Domestic clients don't care. They are interestd in the bottom line.

    VAT regd. co's may only deal with other VAT reg co's, or they effectively pay VAT on materials without being able to reclaim it.

    IF you get into renewables, in a big way it is almost certainly better to voluntarily register
     
  3. dreadnoughtheating

    dreadnoughtheating

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    For private customers any quotes have £x inc

    For other businesses quote is £x/1.2 +VAT

    ALWAYS inc the VAT amount & rate on the final bill. (bit like tesco's really, they don't have any shelf notice to say plain digestives have 0%, but choccy ones have 20%)

    As said, private punters only worry about the final amount, not how its made up. Anyway, on say a boiler/heating/controls upgrade, where materials are 50% of the price, non VAT installers have to pay 20% on materials at the trade counter, where I can claim it back (but have 20% on labour instead to even it up)

    Just my two pennies worth.

    DH
     
  4. WoodYouLike

    WoodYouLike

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    Now that's one I don't understand. We're VAT reg and deal with domestic clients often. We charge them VAT and we claim back the VAT on the purchases.
    Where did you get this "info" from???
     
  5. FiremanT

    FiremanT

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    I badly phrased that contribution. In particular, substitute "may" with "might choose to". But I am still not sure why you are confused.

    Anyway, to explain: I have now deregistered, so lets say that do a job for a VAT reg firm. If I bought, say, £1000 + VAT of materials, I would charge the client co., £1200 (ignoring any profit for this example). The client co. could not claim the VAT back, as I obviously no longer have a number. If YOU were to do the work, you would charge the £1000 PLUS VAT. The client co. would therefore pays you the £1200, but cliam back the £200. So, a big firm could spend £0000000s more than they ought.

    EDIT: I re-read your post, and I think I now see what you are getting at!
    I should have written that "some VAT reg. co.s might choose to PURCHASE goods or services only from VAT regd. traders."
     
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