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New Business - Advice needed

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  • 27-11-2018 9:37am
    #1
    will56
    Registered Users Posts: 1,041 ✭✭✭


    Hi I was wondering if I could get some advice please before I go engaging an accountant etc.

    I am setting up a business.
    I will be selling computer components and offering computer services
    Customers will be regular consumers, unlikely to be selling to business at the moment
    This is a side business to see how things go and earn a little extra income.

    I will be registering the business name
    I assume I will need to file accounts each year even if I don't make a profit/income ?

    Should I register for VAT now ?
    Turn over is likely to be under the threshold but are there other advantages to being VAT registered ?
    I will be sourcing my components from the UK, if I have a VAT number I can buy parts Ex VAT.
    If I'm under the threshold I can sell them on without charging VAT ?

    I realize all this will be better answered and set up with an accountant but I'm just trying to have an idea before I go to one.

    Please move/delete thread if its in the wrong forum


Comments

  • Options
    #2
    MartyMcFly84
    Registered Users Posts: 1,326 ✭✭✭MartyMcFly84


    If you are under the threshold for services in a tax year (was 37,500 in 2017) you don't need to register for VAT.

    The main advantage of being VAT registered is you can claim VAT back from suppliers. Being a small company you can also elect to pay VAT on a cash receipts basis.

    The disadvantage of being registered for VAT is that you will need to charge your customers VAT. You mentioned you will be mostly selling to individuals, this will increase the price for the final consumer by the 13.5% or 23% depending if it is a good or service. Or if you do not wish to pass this price increase on to customers you would take the hit yourself. (If selling to a registered business they can claim the VAT back so its not an issue).


  • Options
    #3
    L.Jenkins
    Moderators, Computer Games Moderators, Technology & Internet Moderators Posts: 19,240 Mod ✭✭✭✭L.Jenkins


    MartyMcFly84 wrote: »
    If you are under the threshold for services in a tax year (was 37,500 in 2017) you don't need to register for VAT.....

    I read the OPs post as them running a company to sell components and no services are being offered, so the threshold is €75,000.

    If you're only starting out OP, do you envisage sales going above and beyond the €75,000 thread within the 1st 12 months? If not, there's no need to register for VAT. You can register for ROS and if your income on the side exceeds €5,000, you'll have to fill in a form 12 for year end.


  • Options
    #4
    will56
    Registered Users Posts: 1,041 ✭✭✭will56


    L.Jenkins wrote: »
    I read the OPs post as them running a company to sell components and no services are being offered, so the threshold is €75,000.

    If you're only starting out OP, do you envisage sales going above and beyond the €75,000 thread within the 1st 12 months? If not, there's no need to register for VAT. You can register for ROS and if your income on the side exceeds €5,000, you'll have to fill in a form 12 for year end.

    Realistically I don't see myself doing that sort of turnover.


  • Options
    #5
    L.Jenkins
    Moderators, Computer Games Moderators, Technology & Internet Moderators Posts: 19,240 Mod ✭✭✭✭L.Jenkins


    will56 wrote: »
    Realistically I don't see myself doing that sort of turnover.

    You should consult with an Accountant for some more impartial advice on the matter.


  • Options
    #6
    will56
    Registered Users Posts: 1,041 ✭✭✭will56


    L.Jenkins wrote: »
    You should consult with an Accountant for some more impartial advice on the matter.

    Thanks, an Accountant is my next port of call.

    I was just getting confused from older threads regarding VAT and Ex VAT and thought I'd found a way to offer products at a lower price

    If the VAT has to be added regardless I will not register as I'm going to be under the threshold - Unless by some miracle it all takes off :D


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