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How do I charge VAT?

I just have a dilemma with FLAT RATE VAT

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I registered for VAT from 01/05/2020 for the flat rate scheme (12%) and I am not sure how to account for VAT. Basically, I received on 01/05/20 £10,000 from a client who is not registered for VAT, thus I cannnot go back and ask the client to pay me VAT on that amount. So, in my accounts should I enter £8,333.33 as the net amount, £1,666.67 as VAT and £10,000 the gross payment? In the future should I charge my clients that are not registered for VAT more or should I charge them the same amount and specify the VAT?

Replies (7)

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By atleastisoundknowledgable...
04th Aug 2020 14:00

1. Yes
2. More

There’s another bit that needs doing to balance everything off, but your accountant will do that at the year-end.

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By Kevin Kavanagh
04th Aug 2020 14:16

Surely if you received £10K from a client on the day you registered for VAT that was for work done prior to that date? In which case you shouldn't be charging VAT on that invoice.

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By lionofludesch
04th Aug 2020 14:44

Imho, you should charge the same price for the same service, whether or not your customer is VAT registered.

However, it won't be difficult to find exceptions in the business world.

Why do you think the VAT status of your customer affects the price ?

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By Paul Crowley
04th Aug 2020 14:50

What are you selling?

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By Southwestbeancounter
04th Aug 2020 14:55

I think you're getting a little confused about your VAT status and that of your clients.

As Kevin Kavanagh has stated - when did you actually do the work for the £10k you received and I would add what is the date of the invoice you issued which resulted in that payment being received?

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By Paul Crowley
04th Aug 2020 15:22

Do you have an accountant? Have you asked him yet. He may know a bit more background, of what appears to be a question, the answer to which may be 'it depends on.....'

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By AWeb72
04th Aug 2020 16:27

What did you show on your invoice to them............................................

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