My client works alone organising history tours around the UK. She is a limited company. She books everything directly with hotels, historical buildings, tour guides, speakers, entertainment etc then sells this as a package to clients. This year her gross turnover will be £100k but her profit from that is only around £20k. She has just approached me to be her bookkeeper and I'm trying to understand TOMS and how it will affect her. As her gross turnover is over £85k does she need to register for VAT for non tour operator costs such as expenses. These will be minimal amounts though. Is there a threshold for TOMS too? As her margin is likely to be small does she wait until that reaches a threshold? Thank you in advance for any help you're able to give.
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The value of TOMS supplies is the margin. See para 4.1 of the HMRC Notice: https://www.gov.uk/guidance/tour-operators-margin-scheme-for-vat-notice-...
This follows art 7 of SI 1987/1806.
Do check that you understand the definitions of the various supplies.