Have Tax Questions? Ask a Tax Expert for Answers ASAP
Hi. My name is*****'m looking at your question now and will post my answer or ask for more information here in a short while.
You are in the flat rate scheme not the standard scheme where you offset VAT you collect against VAT you pay. You can backdate the registration. However, it would be pointless to do that because you would need to go back to your customers and ask them to pay VAT on invoices you previously issued to them with no VAT and then pay over 9% to HMRC. None of your customers wold agree to that.
I hope this helps but let me know if you have any further questions.
If you were not registered for VAT how were you paying 20% VAT to HMR? VAT on what exactly?
As you are now registered for the VAT flat rate scheme, you will charge 20% VAT to DPD. You will then pay 9% to HMRC and the balance you keep and pay tax income tax and national insurance contributions on if you are self-employed and corporation tax onif you operate your business through a limited company. You cannot reclaim VAT on your purchases since the 9% rate for your type of business takes account of the type of business purchases you make, eg fuel.
If you were VAT registered in the standard rate scheme, you would charge 20% VAT to DPD. You would deduct from that VAT you pay on your business purchases and pay over the difference to HMRC. In net terms your business would pay no VAT. Only non-VAT registered businesses and individuals pay VAT.
Hi.I'm just following up to find out if my answer helped or if you have any further questions. If not, would you mind rating my answer so that I get credited for my work.