Registering for Vat

Celtic Cub

Registered User
Messages
19
Hi everyone,

I am registered as a soletrader working in health and safety consultancy providing training, safety statements etc.

I would be grateful if someone could tell me the pros/cons regarding vat registration.

Thanks,

CC.
 
Hi Celtic Cub. If most of your clients/customers are VAT registered then it would generally make sense to register for VAT. This is because although you will have to charge VAT on your sales going forward, your customers can just claim it back so it makes no difference to their overall cost.

If your customers are generally not VAT registered, you have to decide whether you will keep your charges to them the same and then charge VAT on top - thus making the cost to them of using your services more expensive. Or you can choose to keep the overall price to them the same, but your own income will reduce as part of that amount then becomes payable to the Revenue as VAT.

The other general advantage of VAT registration is of course being able to claim back VAT on expenses. This may be of greater benefit to some depending on what type of costs you have etc. If for example your main costs are travel costs, you may find that there is not much VAT to reclaim anyway. However, the majority of people will have a good number of expenses for which VAT can be reclaimed.

Finally, you just need to be aware of the threshold at which you are obliged to register for VAT regardless of whether you would like to or not. And also, you need to be aware of the VAT rate applicable to your particular activity.
 
Hello Celtic Cub,

The threshold for registering for VAT is Euro 37.500 if you supply services. I would suggest to have a look at the following :

www.revenue.ie/en/tax/vat/leaflets/vatguide_2008.pdf

By the way that is the last published guide, obviously there have been changes since the start of this year, but the guide for 2009 incorporating the changes has not been published yet.

I believe that the service you supply is charged at 21.5%.

Hope this helps
 
The training aspect of your work is VAT exempt (scroll down to Training, Health & Safety)

http://www.revenue.ie/en/tax/vat/rates/index.html#T

I'm not sure about the other aspects of your business

The exemption aspect however means that the amount of VAT which you can reclaim will also be restricted - ie you will not be able to recalim ALL of the VAT which you incur.