I know business fragmentation and separation questions have been asked on here lots of times before but I'd appreciated any thoughts and advice on my specific situation if possible please. It's reasonably straightforward...
I'm a commercial photographer and operate as a director of my own ltd company. The vast majority of my work involves clients hiring me for marketing, advertising and branding photography within their businesses. My clients range from start-ups to FTSE 100 companies. I've been in business for 17 years and have been VAT registered for the last 10 years.
Last year I started selling prints of my personal photographs via a new/separate website. Despite it being a separate website and the fact that it involved selling physical goods (rather than my photography services) my accountant advised that it was sufficiently similar to my commercial photography and because it involved using the same cameras and lenses etc that it should be included as part of my ltd company business and I should therefore charge VAT on my prints.
I'm now starting a new business, picture framing, and I would ideally like to do this as a sole trader, keep it separate from my photography and not be VAT registered. The framing uses different resources to my photography, eg there is no overlap of equipment and is done in a different location. I can operate it independently with different bank accounts, book-keeping etc. So two questions:
1. Is it likely HMRC will see the framing as a sufficiently different business to my photography and agree I can run it as a non VAT registered sole trader?
2. If so can I as a sole trader charge my ltd company for framing services, eg when the limited company sells a framed print to a customer, or will this muddy the waters in terms of artificial separation?
As I say any thoughts or advice on this would be gratefully received.