Can I set-up a company and claim back VAT?
Question
If I have a company set up as a letting agent who provides building maintenance to my properties, then can I therefore charge VAT? This would mean that my company now provides a service, which allows it to become registered for VAT. If this is the case then is there a minimum turnover required per annum or could I have work done as minimal as replacing a door and charge VAT ? This would mean that everything I pay VAT on i.e. vehicles etc.. I could claim back? Ian Says If you are registered for VAT then you will have to charge VAT on your services, i.e. you would charge VAT on your letting agency fees. You can voluntarily register for VAT below the VAT threshold. You cannot pick and choose as to what is chargeable to VAT, you would have to follow the rules, so you would end up charging VAT on your agency fees and costing yourself more money, as you would not be able to recover this VAT yourself from your properties. Having a car in such a company (you mention claiming VAT on vehicles) also does not seem like a good idea to me, and the VAT rules on cars are complex in any event, as are the rules for claiming back VAT on petrol. I would not recommend that you register for VAT unless you have to in these circumstances.
Case Study
|