VAT Query

M

martin35

Guest
Good Afternoon

I was in an area that was exempt from VAT but now I am starting to operate in an area covered by VAT.

I have the TR1 etc but I have query re the threshold for VAT.

What is the current threshold and does it mean that you don't pay VAT till you reach the threshold therefore you do not charge VAT to customers till you hopefully reach the threshold?

Apologies but I am finding this area a little confusing.

Any advice greatly appreciated.

Martin
 
Annual turnover thresholds presently €35,000 for services €70,000 for sale of goods, increasing to €37,500 and €75,000 respectively from 01/05/08.

You do not have to register until your annualised turnover looks like it will exceed the threshold amount. You may elect to register if under the threshold. Decisions on electing will depend on the line of business, customer type etc. For a person whose customers are largely non VAT registered ( e.g. the general public) most people are better off not registering until hitting the threshold. If the customer base is largely VAT registered then it may, in some cases, make sense to register while under the threshold as the VAT charged by you is recouped by the customer and you get the benefit of VAT claims on your costs.

If trading while not registered any VAT suffered by you is just included as part of your costs.
 
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