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VAT aggregation question

VAT aggregation question

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I would appreciate an opinion on the following situation. I have a small accountancy practice which I run from home. I am VAT registered but, I have been running the practice down, not taking on new clients et cetera and so I may shortly be able to deregister. My daughter assists me in dealing with the admin, some tax returns and accounts for sole traders and other related things. I will be retiring in the foreseeable future and would like her to take over my practice but, whilst she is studying accounting and taxation, is not competent enough to deal with the limited companies and so I have been in contact with a friend who is a CA, I would appreciate an opinion on the following situation. I have a small accountancy practice which I run from home. I am VAT registered but, I have been running the practice down, not taking on new clients et cetera and so I may shortly be able to deregister. My daughter assists me in dealing with the admin, some tax returns and accounts for sole traders and other related things. I will be retiring in the foreseeable future and would like her to take over my practice but, whilst she is studying accounting and taxation, is not competent enough to deal with the limited companies and so I have been in contact with a friend who has a practice a few miles from me which deals with company liquidations, IVA’s et cetera. He doesn’t do what I do apart from perhaps accounts for a few relatives and friends.

My idea is that he enters in partnership with my daughter in my practice so that he can supervise and deal with the work that she can’t. I don’t see my daughter being involved in his practice.

My concern is whether, in becoming a partner in my practice that is sufficient for HMRC to contend that the income from the two practices pushes my practice back into VAT land. The only other common factor is that my daughter may work in his office and they will not be any other sharing of resources apart from some office supplies. I don’t see it myself because the two practices started separately and will remain separate with negligible communality, apart from one person being involved in two practices. I am not sure if his practice is VAT registered because we have only just spoken about the idea in principle, but I’m pretty sure it probably is.

Hopefully I have thoughts about all of the relevant points needed for your consideration of the lives not too far from me and who has a practice which deals with company liquidations, IVA’s et cetera. He doesn’t do what I do apart from perhaps accounts for a few relatives and friends and I don’t do anything that he does.

My idea is that he enters in partnership with my daughter in my practice so that he can supervise and deal with the work that she can’t. I don’t see my daughter being involved in his practice.

My concern is whether, in becoming a partner in my practice that is sufficient for HMRC to contend that the income from the two practices pushes my practice back into VAT land. The only other common factor is that my daughter may work in his office and there will not be any other sharing of resources apart from some office supplies. I don’t see it myself because the two practices started separately and will remain separate with negligible communality, apart from one person being involved in two practices. I am not sure if his practice is VAT registered because we have only just spoken about the idea in principle, but I’m pretty sure it probably is.

Hopefully I have thoughts about all of the relevant points needed for your consideration of the situation.

Replies (3)

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By mrme89
14th Jul 2016 13:24

I think you should read your post and then reformat it so that it is legible for the readership.

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By brian-scholar
14th Jul 2016 13:56

Yes your right, I don't know how that happened I really ****ed that up.

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By JessicaRain
14th Jul 2016 17:15

That post was like delving in and out of the twilight zone.

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