VAT on associated businesses

VAT on associated businesses

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I have a client who controls a VAT registered company through which he is a computer consultant.

He also earns sporadic small amounts of income from music, playing on a semi-pro basis with various groups and orchestras. This barely covers expenses incurred, and would be a maximum amount of around 2,000 turnover a year (usually with a tiny profit or loss).

Should he:
1) Declare the music income through his company.
2) Register as self employed and declare it on his tax return.

As the company is a separate legal entity carrying out a completely different trade to the self employment, I didn't see a VAT issue, but speaking to a couple of people they believe the VAT registration could apply to the selfemployed income.

The VAT helpline have given two opposing answers on this from two different people at different times, so I welcome opinions!
JLM

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By AnonymousUser
29th Apr 2005 16:21

The two are separate
As the company provides the computer consultancy services if your client, as an individual and unconnected with his employment by the company, earns income from playing music it is not the company's income and thus is not brought into the VAT registration of the company.

Regards

Marc

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