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VAT problem for sole trader with 2 trades

Sole trader is voluntarily registered for VAT on trade A but does not want to charge VAT for trade B

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 A sole trader photographer who has commercial clients (VAT registered) is voluntarily registered for VAT.

Due to coronavirus he wants to make and sell furniture to private individuals (not VAT registered).

Can he run the furniture business as though it is not VAT registered and not charge the 20% output tax and not claim input tax whilst keeping the phorography business as VAT registered?

Or should he set one business up as a limited company?

Or should he deregister the photography business?

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By jvenegas16
07th May 2020 11:32

As a sole trader he has one VAT registration for all businesses. Running the furniture business as a limited company would be more appropriate, as the two business activities are different and separate, so no artificial separation. Otherwise, he will have to charge VAT on the furniture business.

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