vat help for catering concession

vat help for catering concession

Didn't find your answer?

Hello,

My wife and I (business partners) have just completed our first season of trading. Runs from march until november at a holiday park catering concession. We turned over 56k with a profit of 21k after 8k of rent and all the food/ staff costs.

we have been invited to take on a different holiday park after a good performance .

this new park is much bigger and would be 17k rent but a similar formular on food costs etc.

The problem being it looks likely that by working at this bigger park we may break the vat threshold but we are not exactly sure by how much. (Between 90k and 120k we think)

Is there any way of making vat work for us on this bigger venture or would it be wise to stick with what we know and stay under at the other park. We cant stop trading until the end of the parks season so I cant just clise when/ if we get to 80k.

We really want to work hard and make more money but feel a little trapped.

can flat rate work for a venture like ours ?

Any help is appreciated andni can give more detail if needed

kind regards

c

Replies (8)

Please login or register to join the discussion.

avatar
By [email protected]
24th Nov 2014 17:46

I forgot to say that we dont really have mxuch to claim back on vat when thinking about the flat rate scheme

Thanks (0)
By The VAT Doctor
24th Nov 2014 20:42

Incorporate
As has been debated at length recently here, if you set up a limited company before reaching the threshold, the partnership turnover won't count and you can start again. Built in excuse too with the extra risk!

Catering businesses are the worst hit - no VAT on raw purchases, but VAT on sales.
When VAT is inevitable, the FRS May work, but also consider the rules on takeaway cold food if this is relevant as these sales may be zero rated still

Hope this helps

Thanks (1)
Replying to Tax Dragon:
Portia profile image
By Portia Nina Levin
25th Nov 2014 10:57

Would you care to explain VAT Doctor

The VAT Doctor wrote:
As has been debated at length recently here, if you set up a limited company before reaching the threshold, the partnership turnover won't count and you can start again.helps

Why does the partnership turnover not count, when there has been a transfer of a going concern? See: http://www.bailii.org/uk/cases/UKFTT/TC/2012/TC02371.html

Thanks (0)
avatar
By [email protected]
24th Nov 2014 21:41

Hi thanks for the reply,

can you link me up with the infomation/discussion ? I dont seem ti be able to find anything relevant (probably my lack of understanding in general thats hindering me

thanks again

Thanks (0)
By mjshort
25th Nov 2014 08:33

Flat Rate/Companies

Flat rate scheme- 12.5%.

I have similar clients- are you doing alcohol as that has VAT on purchases? Lots of sandwiches at zero% etc- might get you to about 7.5% net VAT rate anyway.

 

Have one limited company for each site so existing site gets Nil VAT still.

Thanks (0)
avatar
By [email protected]
25th Nov 2014 10:42

Thanks for your further comments and advice.

Just to clarify we do have the option of managing both holiday sites. Its most likely that we will just choose to run one of them next year however.

There is no vat to be paid on the rent and we are not allowed to serve alchol as the site runs a bar.

many thanks for your time and advice

c

Thanks (0)
Portia profile image
By Portia Nina Levin
25th Nov 2014 12:03

@ Basil

Thank you. I have re-read VATA 1994, section 49 and see the crucial words "transfer by a taxable person."

Thanks (0)
Replying to Accountant A:
By The VAT Doctor
25th Nov 2014 22:08

Saved

Portia Nina Levin wrote:

Thank you. I have re-read VATA 1994, section 49 and see the crucial words "transfer by a taxable person."

@Basil, beat me to it (and saved me from a PNL roasting no doubt!)

Thanks (0)