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VAT registered sole trader also in a partnership

What are the VAT implications when a VAT-registered sole trader also sets up a partnership?

I am a photographer that has been operating as a VAT-registered sole trader for a number of years. Recently, I have set up a partnership with my wife to offer creative services to small businesses, which will include web design, content production, brand launches, etc., and wonder whether or not there is a requirement for the partnership to be VAT-registered from the outset: I am unsure about this due to the fact that the content production element will, at times, involve photography and I am concerned that HMRC could argue that this work done under the partnership banner overlaps my work as a sole trader and should, therefore, also be subject to VAT.

Any advice would be appreciated.

Many thanks

LDJ

 

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15th Mar 2019 13:20

What does your accountant advise?

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15th Mar 2019 13:24

In theory, the partnership has no obligation to register.

In practice, you need to be very sure that the two businesses are kept separate. Yet you say they "overlap". So the question you need to discuss with your accountant is "are they truly independent ?"

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15th Mar 2019 13:59

I did have an accountant, but for the last few years have been happily completing my own returns – yes, it probably is time to re-engage the services of an accountant.

Although the partnership is recently formed, I have kept the two businesses separate in terms of banking and record keeping. I have not yet billed for any work under the partnership.

The overlap I refer to is simply that I obviously offer photography services as a sole-trader and will be offering photography services as part of content creation for the partnership – perhaps there is a question of true independence and I should wind up the sole trader business to run everything under the partnership.

I guess, as with many tax-related issues, there is not a clear-cut answer and an accountant would be of benefit.

Thanks.

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to ldjonline
15th Mar 2019 14:05

So you are a VAT registered sole trader for the last few years and you've recently also started a partnership business, all without engaging an accountant.

Good chance that you've already cost yourself more than an accountant would charge.

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15th Mar 2019 14:07

Thanks for both of your helpful comments, Wanderer.

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to ldjonline
15th Mar 2019 22:43

ldjonline wrote:

Thanks for both of your helpful comments, Wanderer.

It might not be what you want to hear but it doesn't make it wrong. Accounting and tax are sufficiently complicated that people take qualifications in them and earn a living advising. A good accountant will make sure you operate your business tax efficiently and, just as importantly, make sure you are tax compliant. If you can't see the value in that then you probably know less than you think you do about the subject.

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to Accountant A
16th Mar 2019 04:04

I don't have an issue at all with what was said, merely the sneering and snarky tone of Wanderer's comments.

Had Wanderer written, 'this matter could be complex because of x,y,z, so I suggest that you find the services of a good accountant' then I would have offered genuine thanks.

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to ldjonline
16th Mar 2019 04:46

ldjonline wrote:

I don't have an issue at all with what was said, merely the sneering and snarky tone of Wanderer's comments.

Love it!
You object to what you interpret as sneering and snarky by making a sarky comment!
Anyway you haven't read or have mis-interpreted or ignored the purpose of this forum.
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