[Closed] VAT only invoices

depends on your t's and c's but how did you end up not being vat registered 3 years ago and only just finding out about it?

If it were my company I'd tell you to pay it yourself.

I think they'd at least hope for a bit of warning. Arguably its all reclaimable by them if they to are VAT registered, but its still a cash flow issue for them if it is indeed loads of money.

How did you arrive in a situation like that?

are you charging it at the prevailing rate 3 years ago or the current one?

It's the current rate you invoice at, apparently.

I [i]think[/i] that I am allowed to do this, and they have to pay, but I'm worried that they're going to kick up a fuss 🙁

I applied for VAT registration when I incorporated in 2007, there was somethign wrong with the form so it didn't go through and I failed to do anything abotu it for two years.. then I had to re-register and backdate the registration (you have to) so now I have to chase it all up. And yes HMRC did fine the b*llocks off me.

if you have a relationship with anyone there now I'd phone and explain what's happening prior to sending the bill...

I would have thought as long as you don't back date the VAT invoice they won't mind, If its dated in this VAT quarter they can use it in their VAT returns.
But ring them and speak to them first!!

This sounds like one of those alarm bells that says you shouldn't be in business.
If someone tried to invoice me for VAT going back 3 years, I'd be furious. And I'd be invoicing you for administration time.

So do you now have to re-invoice everyone you've billed for the last 3 years? How many of them do you want to work with again? 🙂

Is it something you [u]have[/u], to do in the HMRC are compelling you to collect vat from everyone retrospectively? or something you're now entitled to do so you're thinking why not?

For any clients that are VAT registered its ultimately no big deal, but its going to be a lot of fannying about for them, depending on how they are set up to account for VAT. They're not going to love you for it.

If the vatman is insisting you do this (or are making you liable for the vat on the invoice) have a word with them to establish the standard procedure and enclose a copy of their reply with the invoice. That will make it a bit more official.

Of all the stupid things you could do in business, this has to be up there.

That said I hope you sort it, ****ing with HMRC is my biggest fear.

Mr Grips. It's new accountant time!

DOH! If one of our suppliers did this to us, I'd look for another.

3 years... I'd tell you to stick it.

I failed to do anything abotu it for two years

And yes HMRC did fine the b*llocks off me.

I don't do the VAT stuff the missus does but I think that once you invoice them, you'll need to pay up next time you submit your return,
I'd time it right if I were you

Molgrips
Wasn't there a discussion recently about your lack of a decent Accountant/FA?

Edit - Yep, found it:

http://www.singletrackworld.com/forum/topic/accounting-question

So we can revel more in your misfortune, what line of work are you in, what did the supplier supply and how much is the VAT bill?

...don't forget to claim all the VAT back on your purchases for the last 3 years!

The VAT you owe minus this may mean you don't owe the VAT man too much and you could perhaps pay it without peeing of your customers.

Just a thought.

Speak to your accountant... Haha!

I don't have suppliers and customers, I am an IT contractor so I just have agencies that I work through. And I don't have any purchases to speak of.

Who's fault is that then...

Did you think I was trying to claim otherwise?

It's not my accountant's fault that's for sure 🙂

So we can revel more in your misfortune

Incompetence mate, luck got nothing to do with it 🙂

Has far as i am aware your accountant can clam back upto
6 years of VAT purchases towards your company IE Tools,van etc.

But i feel you have been told wrong there Because you was not VAT registered so you Cant collect VAT.

Have a chat with your accountant before you send these invoices off
Because I woukd not accept this late claim myself has you have already recieved payment and was not registered to collect Taxes at that time.

I have been in touch with my accountant, he's given me figures to invoice. I was not registered then, but I had to have my registration back-dated by law.

molgrips

Have you looked at the fixed rate vat scheme? In our year-end accounts our accountant shows the +/- of been fixed rate, its worth a couple of grand plus no worries about the VAT Man checking the books as you pay based upon (gross) sales value.

And register as a Business Consultant rather than an IT Consultant and its a better rate.

If you have a good relashonship with your agency then it should be not problem. Just remind them they make a fair bit of cash from you.

But they may have however billed the client based on the fact you were not VAT registered, even though there bill would have incured VAT (assuming they are registered, which they will be)

Have a look at you contract, how is the rate expressed is it say something like £45 + VAT/Hr or just £45/Hr. If it does not detail the VAT then I reckon they may tell you to poke it as they assumed it was £45 including the VAT.

Remember though your contract is generaly with the agency, they are the ones who pay you, not the client. So its upto them to be kind to you not your end client.

This really is noddy stuff, as a director of a company you do have certain responsibilities !!!!

Bazzer

PS Edited to add BR is right as an IT contractor generaly the FRS scheme is the way to go, unless you are a geek and buy lots and lots of computer equipment for you work.

After reading the above all will be simple.

What you have to do is contact the Agency and explain using the
letters and demands from the Inland Revenue including your VAT Number.

You will have to go through all past recipts and add all the VAT
and then minus the total VAT against your past invoices VAT and send the
remainder off to the Inland Revenue.

Has the Agency will be VAT registered anyway so they will be only happy
to pay you this has they can retrieve back without any problems
and will not effect there clients.