Vat

cruiser202006

I'm a plumber and Accountant registered me for vat which is effective from 28/11/16 a few days later than I'd asked them to. Ordered material for a job on the 24/11/16. Doing vat up at the moment. Got paid for job last week. I'm guessing I won't be able to claim back vat on material but I'm gonna have to pay the vat on it??

EamonOSullivan

cruiser202006 wrote: »

I'm a plumber and Accountant registered me for vat which is effective from 28/11/16 a few days later than I'd asked them to. Ordered material for a job on the 24/11/16. Doing vat up at the moment. Got paid for job last week. I'm guessing I won't be able to claim back vat on material but I'm gonna have to pay the vat on it??

Generally Revenue will not object to ''pre-trading'' expenses, as long as they are business-related, and were incurred within a reasonable period before the start of trading. In this case I think your expenses pass both tests.

tanit

It's considered stock bought in for new activity in business and it's allowed to reduce thresholds so it can be considered for Vat return purposes. Used as such (accounting for them in Vat on Purchases) and keep all records in case you need then but there shouldn't be a problem

I hope this helps

jcon1913

tanit wrote: »

It's considered stock bought in for new activity in business and it's allowed to reduce thresholds so it can be considered for Vat return purposes. Used as such (accounting for them in Vat on Purchases) and keep all records in case you need then but there shouldn't be a problem

I hope this helps

There is no threshold in relation to purchases. Thresholds only relate to VAT on sales

tanit

jcon1913 wrote: »

There is no threshold in relation to purchases. Thresholds only relate to VAT on sales

Hi

I know there are no thresholds regarding purchases and they are only for sales but the point I was trying to make is that the only way you can reduce your threshold is by the amount of vat on purchases for inventory bought for a new activity. So the principle would be that products/inventory bought for a new activity if they can be used to reduce the threshold they can also be used as a credit against sales even if bought before registration date (within a reasonable period).

I might not have explained it very well.

jcon1913

tanit wrote: »

Hi

I know there are no thresholds regarding purchases and they are only for sales but the point I was trying to make is that the only way you can reduce your threshold is by the amount of vat on purchases for inventory bought for a new activity. So the principle would be that products/inventory bought for a new activity if they can be used to reduce the threshold they can also be used as a credit against sales even if bought before registration date (within a reasonable period).

I might not have explained it very well.

They do not reduce the thresholds AFAIK and nothing you said above convinces me that reclaiming purchases affects your sales in any way.