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?