Two businesses on one VAT registration

Sole trader with two businesses, each on separate software. How does he file his VAT return?

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I have a client who runs two businesses, each with a Freeagent account.  Joint turnover has just gone over VAT threshold and he's about to register.  From what I can see, Freeagent will only allow manual adjustments to boxes 6 to 9 of the VAT return it generates. How should he include the output and input VAT of the second business without throwing out the accounts? Not even thinking about implications of MTD yet!

Replies (7)

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By Jason Croke
21st Oct 2023 07:15

Going to need bridging software, then export data from each FreeAgent account as an xls file and then upload into bridging software.

Good and free (but donations welcome) option here

As a sole trader why not just put all sales together and then operate just one FreeGent account?

Thanks (3)
By Matrix
21st Oct 2023 11:46

I would ask FreeAgent. If the client wants two different subscriptions for their two businesses there is no obligation to run on one subscription just to meet MTD.

I would probably extract and use bridging software. However you could readily use journals each quarter to change any box and file through one of the accounts.

Thanks (1)
By rockallj
24th Oct 2023 12:49

I’d go with Jason on this.

Extract .csv files from each business’s subscription and combine with spreadsheet & bridging software. Taxcalc & Absolute are reasonably priced & easy to use.

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By Roland195
24th Oct 2023 13:59

Is it a sensible business policy to have two individual sole trades that have a combined turnover requiring VAT Registration?

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By DexterDog
10th Apr 2024 12:07

How did you get on with this? I have a client in the same boat; a farming family, two brothers run separate businesses but both as identical partnerships so they have the same VAT number for both businesses. Bridging software should work but will Freeagent let you run two companies both with the same VAT number?

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Replying to DexterDog:
By FactChecker
10th Apr 2024 16:00

Just a thought (to which I have no definitive answer) ...
... if you have two distinct businesses that nevertheless share the same VAT registration, then how do you ensure/prove that each item of input VAT belongs to one or the other business?
Not so much in pure accounting terms (and the potential mess of apportionment if the supply is shared), but in terms of whether it is an 'allowable' input at all - given that it might be allowable for one of the businesses but not for the other?

Thanks (2)
paddle steamer
10th Apr 2024 12:39

I always think divisional accounting re P & L but one balance sheet is the way to go with these sorts of things, so one ledger, two P & L accounts within and one set of balance sheet accounts (You can fiddle Fixed Asset classes to allocate depreciation etc if required)

When I worked with Benetton this is certainly how I dealt with our shops, each reported as its own cost centre, warehousing /distribution reported as another, admin/office as a final one.(Think back then it was Sage Sovereign we used but no doubt these days fairly easy to have cheap cost centre accounts software)

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