I think I know the answer to this question but would just like to be sure before I advise client!
Client is a wedding photographer. He requires a deposit when he takes the booking and raises the invoice at that point. Eg. Wedding booked in December, total cost £800. Photographer invoices client in March for full £800 but is paid only £200 deposit with the balance being paid in December.
Deposit is non refundable.
I understand that the tax point for the £200 would definitely be March when the invoice is raised but is this also the tax point for the remaining £600 or is this in December? He's approaching the VAT registration threshold so this would be the difference between him registering or not.
If the tax point is March for the full £800 could he get round this by raising two separate invoices? Would the deposit being refundable make any difference?
Many thanks in advance.