Flat Rate VAT Scheme

[radders]

We are starting to think once more about registering for VAT and came across the flat rate scheme where you just pay 6% say on your sales instead of 17.5%. The only drawback being that you can't claim back the input tax. I wanted to know:

• is there any module to help with this?
  
• would you use the standard vat module?
  
• would you just use the tax-free set-up and handle the ta manually?
  

Thanks for any help

[burt]

I'd use the standard VAT tax setup in Osc - set up a 6% rate and apply it to the appropriate products.

 

Do you have a link to this "falt rate scheme". I'm also considering going VAT registered and I'd like a read to see if it would be worthwhile. Ta.

[radders]

It is easy to find on hmce.gov.uk except that their site is down right now :-)

 

I wondered about doing it that way but I think the VAT rate would still need to be set at 17.5% or zero where appropriate as that is the amount of VAT the customer is paying. What they didn't mention was what you do about supplies to countries outside the EU.

[dpsoftware]

It is easy to find on hmce.gov.uk except that their site is down right now :-)

 

I wondered about doing it that way but I think the VAT rate would still need to be set at 17.5% or zero where appropriate as that is the amount of VAT the customer is paying. What they didn't mention was what you do about supplies to countries outside the EU.

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The flat rate schemes only affect the VAT you pay to customs and excise and not the amount you charge to the customers.

 

So the module is the same as standard VAT and you charge the customer 17.5% or zero depending on if it is inside or outside of the EEC.

 

The amount you pay to customs is a fixed percentage of your turnover so it is easy to calculate from your accounts.

 

If you supply lots of goods outside the EEC then you may be better off with standard VAT since you will end up paying VAT where you haven't collected it - that was my understanding of it anyway. Also you can't claim VAT back on any purchases you make - with some exceptions.

 

Regards

 

Dave Peters

DP Software