Share this content
5

Vat FRS assoc businesses & legal entities

H&W partnership trading and own rental business so rents will be include in turnover if under FRS

Didn't find your answer?

Latest Any Answers

We have a H&W partnership and they also own property letting business, they are reaching the vat registation turnover limit but are in a business where they will have to swallow the vat. The FRS rate will be 10% so this looks more attractive it does not look like they will come under the limited cost trader rules. Only problem is the property rental. Suggested solution is one partner leaves so different legal entity, or should they incorporate? But what about  associated business rules would these apply and stop the business joining the scheme? 

Replies (5)

Please login or register to join the discussion.

chips_at_mattersey
By Les Howard
18th Jul 2020 14:57

The associated business rules mimic the disaggregation rules which are familiar to many. These prevent use of the FRS where there is an associated business.
The HMRC guidance is actually slightly relaxed compared to the Regulation. And I have seen HMRC follow the guidance in preference to the legislation.

Thanks (0)
Replying to leshoward:
avatar
By Di
18th Jul 2020 15:31

Do you have a link to the HMRC guidance you refer to please?

Thanks (0)
Replying to Di:
chips_at_mattersey
By Les Howard
20th Jul 2020 08:37

VAT Regulation 55L(2)(d)(iii) & Notice 733, para 3.8.

Thanks (1)
Psycho
By Wilson Philips
18th Jul 2020 15:06

Residential or commercial property?

Or is it the trade turnover alone that is nearing the limit?

Thanks (0)
Replying to Wilson Philips:
avatar
By Di
18th Jul 2020 15:29

Some of the property is residential and some is commercial. It is the trade that is nearing the limit

Thanks (0)
Share this content

Related posts