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Does my Wife have to pay tax and Vat on her new shop?

  • 14-06-2010 9:32am
    #1
    Rainman100
    Closed Accounts Posts: 1 ✭


    Hi there, Im new to this but have heard good reviews so I said Id give it a go...

    My wife is after opening a small Florist Shop in the last week, and Im wondering about a few things;

    1) Does she have to register for vat? (expected turnover will be E50000 approx).

    2) I know she will have to pay some sort of tax, but im wondering does she have to start paying immediately or can she wait until end of year and then pay? or how often does she have to pay? or what % will she have to pay?


    She has booked an appointment with an accountant but thats not until end of june, so we are worrying about having someone come to the shop and question her!!!

    All good advice much appreciated!


Comments

  • #2
    DoMyBooks
    Registered Users, Registered Users 2 Posts: 355 ✭✭DoMyBooks


    The VAT threshold for supply of goods is €70,000 so in the short term she does not have to register for or charge VAT. Keep a careful eye on her turnover though.

    As regards what tax she will pay pleminary tax is due in October, Her Accountant will go through this with her.


  • #3
    Ladybird99
    Registered Users, Registered Users 2 Posts: 82 ✭✭Ladybird99


    If you have to wait two weeks to meet the accountant, perhaps you should shop around. How long are you going to have to wait if you have a problem down the line?


  • #4
    misspiggy40
    Users Awaiting Email Confirmation Posts: 277 ✭✭misspiggy40


    With regard to Tax have a look at this link. It will give you both plenty of info so that it is not all new to you when you do get to sit down with your accountant;)

    http://www.revenue.ie/en/tax/it/leaflets/it10.html


  • #5
    wishful thinker
    Closed Accounts Posts: 78 ✭✭wishful thinker


    Rainman100 wrote: »
    Hi there, Im new to this but have heard good reviews so I said Id give it a go...

    My wife is after opening a small Florist Shop in the last week, and Im wondering about a few things;

    1) Does she have to register for vat? (expected turnover will be E50000 approx).

    2) I know she will have to pay some sort of tax, but im wondering does she have to start paying immediately or can she wait until end of year and then pay? or how often does she have to pay? or what % will she have to pay?


    She has booked an appointment with an accountant but thats not until end of june, so we are worrying about having someone come to the shop and question her!!!

    All good advice much appreciated!
    Answer to your questions
    1. VAT threshold for Supply of GOODS is €75k....not €70k as stated previously.
    Some points to note if NOT VAT registered.
    • If NOT VAT registered thenVAT that the business incurs (e.g. Telephone, Light & Heat, Rent) - cannot be claimed - basically increases your costs.
    • If NOT VAT registered andimporting from say Holland the cost to the business is increased compared to VAT Reg competitors as you cannot provide an a Irish VAT no which would mean that a 0%Vat rate would not apply to these type of purchases - basically increased costs
    • If you do register for VAT and as 90% of the business if likely to be consumers, then you would account for VAT on a CASH RECEIPTS basis - cashflow saving for business.
    • Please note that the flourist business may have different rates applied to it -funeral flowers provided as part of funeral package to undertaker - exempt from VAT; bouquets - 13.5% - basic point, you would have to be careful in recording SALES & PURCHASES. Once you did this a few times, you would have the hang of it.
    • You would be expected to keep books and records - bank records, purchase invoices, sales invoices.
    2. If she is a SOLE TRADER - then Income Tax is what she pays
    If by chance she is a company - Then the company registers for Corp Tax, and she would also have to register for Income Tax as a director.
    • You would be expected to keep books and records - bank records, purchase invoices, sales invoices. From this your accountant would ascertain the PROFIT/LOSS for the year
    • As the business has started in mid 2010, the sensible thing would be to run the FIRST accounts for 18 months - ending in 31 December 2011. At that point, the accountant would calculate the Income tax due for 2010 & 2011. Then, each year after it would be 1 Jan - 31 Dec.
    • The smart thing is to put some monies aside each month. You cut put this into a deposit account - earn something rather than nothing and then when you are asked to possibly write a chq for €10k, you have it saved and the pain is eased a little.
    • How much to Income Tax to pay - it depends on you as a family unit and your overall incomes in the year - basically, with planning you can reduce your tax liabilities - so ask for suggestions.
    As for someone calling in - by extreme chance it may be Revenue doing a check on cash businesses - so best advice is ensure that everything tallies otherwise £$% can hit the fan.

    any issues you can ask away


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