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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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I run a day care service with learning disabilities

Customer Question

I run a day care service for adults with learning disabilities Monday to Friday 9 to 4.I don't have to administer medication.We charge this service to parents carers monthly we don't charge vat to them.we are a small business and I do have to
pay vat at the moment on a flat rate scheme.My accountant has said I am required to charge my clients vat.I can not do this as I would lose clients.Is there anyway I can de registar vat, as I feel this is unfair us having to pay vat on such a small business.
Regards Jenny
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.

Hello, I am Keith, one of the experts on Just Answer, and happy to help you with your question.

There is no requirement to register for VAT unless your turnover in any one year approaches of exceeds 82K. Turnover is calculated fro standard, reduced or zero rated supplies made in your business. Your services are not exempt, but standard rated as you do not comply with VAT Notice 701/2 as you are not:

'Supplies of welfare services, and certain goods supplied in connection with those services, are only exempt when made by the following specified providers:

charities - see paragraph 3.1

public bodies - see paragraph 3.2

state regulated private welfare institutions or agencies'

Therefore, as you make what would be standard rated supplies, we have to fall back on the threshold test at 82K turnover. If your receipts reach or approach this level you must register and charge VAT. If they do not registration is not required.

If you are below the limit I would suggest that you seek the services of an accountant with a rather better understanding of VAT than is currently being displayed.

I do hope that I have shed some light on your position.

bigduckontax and other Tax Specialists are ready to help you
Expert:  bigduckontax replied 2 years ago.
Thank you for your support.

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