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Do I have to register for VAT?

  • 10-11-2010 12:57pm
    #1
    Professor Chalk
    Closed Accounts Posts: 12 ✭


    Hi folks,
    Hoping to get a bit of help with this. I've to register soon for Tax for a new business I'm setting up.

    The business will be a b2b service.

    I don't expect the turnover in the first year to be over the €37,000, so as far as I can tell I don't have to register for VAT, but should I do it regardless?

    Would it affect my clients at all? Are there any disadvantages to not registering?

    Thanks for any help :)


Comments

  • #2
    smcgiff
    Closed Accounts Posts: 5,943 ✭✭✭smcgiff


    I'm assuming you're providing a service, Prof!

    If your customers are all VAT registered then it wont impact your competitiveness much*. You will, however, be more expensive for your non-registered customers as they will not be able to claim back the VAT.
    * Some may have cash-flow issues, but shouldn’t be a huge problem.

    You then need to take into account the benefit of being able to claim VAT on your purchases compared to the effort that will go into maintaining VAT.


  • #3
    The Rooster
    Registered Users, Registered Users 2 Posts: 4,757 ✭✭✭The Rooster


    smcgiff wrote: »
    I'm assuming you're providing a service, Prof!

    If your customers are all VAT registered then it wont impact your competitiveness much*. You will, however, be more expensive for your non-registered customers as they will not be able to claim back the VAT.
    * Some may have cash-flow issues, but shouldn’t be a huge problem.

    You then need to take into account the benefit of being able to claim VAT on your purchases compared to the effort that will go into maintaining VAT.

    Also some businesses are VAT exempt, e.g. hospitals, universities, insurance companies, so they generally can't claim back VAT either.


  • #4
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    +1 to what has been posted above.

    I would also add that from a business point of view, if you are VAT registered you may give a better impression to your customers as being a person who is here to stay and established.

    If you are not registered, then when you tendering for a job it will be obvious that you are a small player and this may be the difference between getting the gig and not.

    Hope this helps

    dbran


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