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VAT questions for an accountant or an expert!

  • 29-04-2012 3:14pm
    #1
    Chet Zar
    Registered Users, Registered Users 2 Posts: 968 ✭✭✭


    Hey guys,

    Question on VAT - I need to bill a client tomorrow for work done over the past two weeks. I expect to exceed the VAT threshold for services within the year, but this is not guaranteed either. I have not yet registered for VAT because of this. The client I need to bill is a company that is VAT registered.

    My feeling is that I should register for VAT, but what happens if I don't exceed the threshold within the year? Also, given I won't be billing this client for VAT tomorrow since I don't have a VAT number, should I bill them at a later date once I am registered for VAT?!

    It's a minefield this area, hopefully someone who really knows this area can clear this up?


Comments

  • #2
    sandin
    Closed Accounts Posts: 1,594 ✭✭✭sandin


    afaik, you only need to register for vat when you reach the threshold - until then carry on as normal.


  • #3
    Chet Zar
    Registered Users, Registered Users 2 Posts: 968 ✭✭✭Chet Zar


    sandin wrote: »
    afaik, you only need to register for vat when you reach the threshold - until then carry on as normal.

    Thanks for the reply.

    I don't know if that is the case though, to the best of my knowledge I think the official line is to register if you believe you will hit the threshold within the year. That doesn't make much sense though, and I prefer your proposed method :)

    Anyone else?


  • #4
    Axwell
    Moderators, Computer Games Moderators Posts: 10,462 Mod ✭✭✭✭Axwell


    Moved here, might get a more accurate answer.

    To the best of my knowledge you register when you go over the threshold. You cant backdate it or gain any of the benefits of being VAT registered up to this point obviously so once you cross it you start paying VAT from that point on and at the same time can then reclaim VAT as appropriate.


  • #5
    Chet Zar
    Registered Users, Registered Users 2 Posts: 968 ✭✭✭Chet Zar


    Axwell wrote: »
    Moved here, might get a more accurate answer.

    To the best of my knowledge you register when you go over the threshold. You cant backdate it or gain any of the benefits of being VAT registered up to this point obviously so once you cross it you start paying VAT from that point on and at the same time can then reclaim VAT as appropriate.

    Cheers!

    That would make things a lot easier for me!! Also, it doesn't seem to make any sense for it to be any other way.


  • #6
    smeharg
    Registered Users, Registered Users 2 Posts: 300 ✭✭smeharg


    Chet Zar wrote: »
    Axwell wrote: »
    Moved here, might get a more accurate answer.

    To the best of my knowledge you register when you go over the threshold. You cant backdate it or gain any of the benefits of being VAT registered up to this point obviously so once you cross it you start paying VAT from that point on and at the same time can then reclaim VAT as appropriate.

    Cheers!

    That would make things a lot easier for me!! Also, it doesn't seem to make any sense for it to be any other way.

    It may be easier, but it's not how it works.

    You must register when you expect your turnover for the forthcoming 12 months to exceed the threshold.

    You can opt to register if your turnover is below the threshold.

    Whether you opt to register or not will depend on whether your customers can reclaim the VAT you charge them, and whether the VAT you can reclaim on purchases exceeds the cost of compliance, ie preparing and submitting VAT returns.


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