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Sam, Accountant
Category: Tax
Satisfied Customers: 14195
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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Hi, I am a registered self employer since 2008. I have a question

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Hi, I am a registered self employer since 2008. I have a question about invoice.
I pay tax 20% of my earning every year, but I don't usually charge 20% tax on the top of the payment to my clients.
Can I ask them for paying 20% tax when I invoice them?
If not, is there any process I go through to be able to make them paying the tax?
Please let me know.

Thanks for your question
I am Sam and I am one of the Uk tax experts here on Just Answer.

No - the additional charge on the invoice to which you refer would relate to VAT - and this relates to the provision of goods are services, that have this additional taxation considered and is collected by you on behalf of the VAT office, if
1) You are VAT registered
2) Which you must do if your annual turnover (money coming in) is more than £81000 a year - although some businesses do register voluntarily.

The 20% tax then you pay is your own personal tax - which considers your income, less business expenses - then with the amount left over the first £10,000 is tax free (this was £9440 for tax year 2013/2014) and then you are charged 20% on the rest - (although there are other rates of tax in your figure after those deductions is more than £42,475 OR £149,999)

The two are completely separate from each other, but your client are not responsible for being charged, or having to pay your own personal tax.

Let me know if you have any follow up questions


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Customer: replied 3 years ago.

Hi Sam,

Thanks for the answer.

My turnover was about £36000 last year, so I assume, if I become a VAT registered, I might have to pay extra tax.

If that's the case, I keep it simple, not asking my clients for my personal 20% tax.

Do you agree?



Hi Hiro

Thanks for your response

If you turnover was only £36,000 last year then you are not obliged to register for VAT but can choose to do so voluntarily and there are many reasons why one might do this
1) As it suggests the turnover is in excess of £81,000
2) if you pay out a lot of VAT on goods and services you purchase

But once registered whether voluntarily or because you in the future breach the threshold, only then do you charge 20% VAT on your services (although there are different rates according to the good and services you supply - and different schemes for small businesses)

But as you are not registered for VAT you should not be adding any charge onto your invoices, other than for work undertaken or goods or services (so NO 20% additional charges) and you are always responsible for your own tax and cannot pass this onto your clients.

SO, yes I agree. And you need to reissue the invoice where you had charged an additional 20% to reflect the actual value of the work you undertook - (without the 20% charge)

Do feel free to ask any follow up questions on this topic, but it would be appreciated if you could rate the level of service I have provided, as this ensures I am credited for my time.


Sam and other Tax Specialists are ready to help you