I have husband & wife clients who are in a trading partnership, VAT registered, and also jointly own several residential properties. The VAT is calculated under the normal method. Now the wife is leaving trading partnership because she is a full time teacher, so husband will become sole trader & transfer VAT no. to his sole trade. If he then joins the VAT flat rate scheme, it seems to me that the property income will NOT have to be included in his Vatable turnover. The VAT helpline said the husband's portion of rental income has to be brought into the VAT turnover.
Can any one clarify this please? Thanks