UK VAT and stuff
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- lowimpakt
i've been working a full time job in the uk foir a few months but have just been asked by a charity i have been helping out to do a site for them (they recieved a grant so *have* to pay me).
In simple terms what is the sole trader registration process in the UK or is their a limit to what I can pull in without declaring.
thanks
- determinedmoth0
It's about 30k I understand.
Just give them an invoice and put "not VAT registered" on it somewhere.
- spaniard0
I did exactly the same thing and got charged a shite load of 'emergency tax' for not giving them a number. I suppose I could have claimed it back, but anyway try to get someone to invoice for you ar you'll lose a chunk...
- lowimpakt0
30k
for real?
cool. thanks moth. can I call you moth?
- rasko40
more like 56k before you have to be VAT reg
- determinedmoth0
more like 56k before you have to be VAT reg
rasko4
(Aug 3 05, 08:35)I knew it was a lot... but damn.
- determinedmoth0
cool. thanks moth. can I call you moth?
lowimpakt
(Aug 3 05, 08:12)Yes.
But Gracious Lord Mothalot will suffice...
- lowimpakt0
56K - holy shit.
so are there plenty of freelancers not paying any VAT then......
- Nairn0
This might sound stupid - but do you actually charge VAT for services and ..um.. ethereal media?
- trevedda0
You only have to be VAT registered if you TURNOVER in excess of £56K. You can elect to be VAT registered if you turnover less than that - in which case you then need to make quarterly VAT returns but you can then claim the VAT back from anything you purchase for your work.
If you are not VAT registered you do not need to charge VAT (17.5%).
Yes, design, internet, consultancy are all VATable services if you are VAT registered.
If the job is a one off and paying you less than £56 you don't need to get involved in VAT.
You will need to declare your income to the inland revenue, which is not do with VAT. You will then be required to pay income tax on the revenue you have earned.
If you already pay income tax via PAYE (you are employed and they pay you a salary of over £4k) you can call the IR and tell them you have earned "x" and they will adjust your tax code on your PAYE.
Legally, you can't earn any money without declaring it and paying tax on it. If you invoice you can be audited and traced via your client's accounts. If they pay you in cash it may be a harder to be traced but not impossible.
As a sole trader (ie someone not earning PAYE) you will need to complete a tax return which is not difficult but you may want to get an accountant to assist you.
At the end of the day you may risk not paying tax and get away with it. But it's against the law and morally, if you are resident in a country then you should contribute to it's welfare.
Hope that helps.
- lowimpakt0
trevedda.
perfect.
thanks many times over.