Sole Trader and VAT Pros and Cons

Could someone please advise me on the following VAT question?
Let us say I deliver a service that is worth €25,000.00 developing customised software for a POS (Point of Sales) system.
Do I have to charge VAT? (If I am VAT registered)
What are the advantages for me charging VAT?
What are the disadvantages for me charging VAT?
Thank you in advance.

If you are registered for VAT then you charge VAT at the appropriate rate. [broken link removed].

If you are VAT registered then you can claim VAT on your allowable inputs where VAT is charged to you and if your customers are VAT registered then they can claim credit for the VAT you charge them.

If you are VAT registered and your customers are largely not VAT registered then your price may appear to be dearer than non VAT registered competitors you may have.

Graham 07
I was looking at an old thread on sole traders and travel expenses (still not resolved) and it came to my attention that apparently not all VAT incurred can be reclaimed? I routinely claim back VAT on anything I also count as a business expense, eg stationery, lunches while off-site, hotels, utilities (apportioned from household) etc. I got my office re-kitted with desk, shelving etc and claimed this too. Is this kosher?

I'm also still wondering if a sole trader can claim civil service mileage for travel incurred solely for work - eg home office to client office; home office to airport, etc.

HAs anyone out there been audited and what do they look at?

I've been advised by my accountant now that I've registered for VAT, to claim VAT back on everything that its charge on, except food & fuel.

Misjudged said:

and it came to my attention that apparently not all VAT incurred can be reclaimed? I routinely claim back VAT on anything I also count as a business expense, eg stationery, lunches while off-site, hotels, utilities (apportioned from household) etc. I got my office re-kitted with desk, shelving etc and claimed this too. Is this kosher?

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Food and accommodation are not VAT allowable. Apportionment of expenses for home office is acceptable however bear in mind that claiming costs on home office may bring CGT issues on a sale of the property as not all of it was solely for residential purposes.Any expenses wholly and exclusively for the business are allowable, so stationery, desking, advertising etc. are quite in order.

Misjudged said:

I'm also still wondering if a sole trader can claim civil service mileage for travel incurred solely for work - eg home office to client office; home office to airport, etc.

HAs anyone out there been audited and what do they look at?

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Sole traders cannot claim cs mileage. You claim the actual costs incurred on transport. Fuel, tax, insurance, servicing, repairs, loan interest, wear & tear on cost ( bear in mind restrictions on this ) and all these only allowable to the business extent. So if it is your sole vehicle then you restrict the costs to the actual business mileage only. If you do 20,000km/year and 10,000km of that was business then you can claim 1/2 of the total expenses.