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More Questions RE Setting up a 2nd Business

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Hi all

I asked a question a few days ago regarding the business I run with my husband.  The answers I received were really helpful but have raised a couple more questions if I could trouble you for some more information?

So our current business is a partnership and we are classed as self employed as the business isn't Limited.  We turn over more than £85k pa and have been VAT registered for a number of years.  I am currently setting up a 2nd business, which again I will be running with my husband and again won't be Limited.  This one isn't linked to the original business at all, it will have a different name, logo, website etc.  The only thing the 2 businesses will share is the premises we run them from.

Based on the replies I got on my query the other day about if the new business should be VAT registered, we will be running the new business under the current partnership and using the same VAT number.

This has made me think, if at any point we wanted to share say some packaging materials between the 2 businesses, would this be do-able?  Lets call the current business 'Wedding Shop' and the new business 'Sweet Shop'.  So would it matter if an invoice was made out to 'Wedding Shop' or 'Sweet Shop' or would this be irrelevant as both businesses are effectively the same thing in HMRC's eyes?

Another example is that I'm trying to set up a new account for the new business with Royal Mail. They are looking to put 'Sweet Shop' on a new account but under the umbrella of 'Wedding Shop'. I'm concerned that the invoices for 'Sweet Shop' may mention 'Wedding Shop' on them in case this causes any issues with HMRC, but based on the above would this not be an issue even if it did?  I'm hoping that as long as we can tell the invoices apart for our own reporting reasons (to keep tabs on how much the 2 businesses are making / spending individually) then it won't matter to HMRC?

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By the_drookit_dug
22nd Nov 2019 10:57

You should ensure any invoices made out to you are in the name included in the VAT registration.

Perhaps getting them to add a second line 'T/A …….' might help with your admin.

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Replying to the_drookit_dug:
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By LHM
22nd Nov 2019 11:11

Would this be for all invoices? So if an invoice was made out to 'Sweet Shop' with no mention of 'Wedding Shop' would this cause issues with HMRC?

So another example, say we place an order for some envelopes which we will split to be used between the 2 businesses, if the invoice for the envelopes is made out to 'Wedding Shop' then can we legally use the envelopes for both businesses and would we just split the invoice on our accounting spreadsheet for our own records? As I suppose it won't make a difference to HMRC as the amount we owe them at the end of the year will be the same? I hope that makes sense!

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Replying to LHM:
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By the_drookit_dug
22nd Nov 2019 11:29

I can't see it being an issue.

You're correct to want to keep everything tidy and in order, and it's certainly good practice to have each business correctly identified. But on the occasions where you receive a supply relating to both businesses, the main issues are: a) to have a valid VAT invoice and, b) that you are indeed the recipient of the supply.

I can't see HMRC splitting hairs when it's all under the same VAT registration.

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Replying to the_drookit_dug:
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By LHM
22nd Nov 2019 18:40

Great, thanks so much for your help. I really appreciate it!

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By Accountant A
22nd Nov 2019 14:29

Hi,

I'm after some free wedding related merchandise. Hope you can help.

I'd buy my own but, being an accountant, I give advice for free so don't have an income.

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