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passing on VAT to a client
Hello guys - I am sure that this has been asked before, and I have read elsewhere some solutions but it all makes little sense to me. If I explain what I am doing, maybe someone can tell me if it's right.
As a designer, I was asked to quote for a job, which included print, which I did. My current turnover is less than 60k, so I am not VAT registered, and even if I were to win this work, I would still be under the threshold.
The question is, as a non VAT registered ltd company - and consequently unable to charge VAT - how do I invoice correctly? I have already given my client the costs, and stressed that the print costs I supplied did not include the VAT.
If the total for the print is 10k, and my costs are 1k, the total bill will need to be 13k (I can't charge VAT on my costs, but the print has VAT attached at 20%).
By rights, the client should be able to claim back the VAT on the print shouldn't they? Or do I just invoice a total amount and they have to accept that they can't claim it back as I am not VAT registered?
Any advice much appreciated - I can't imagine that this is a unique issue, although I guess regular print buyers would be over the 60k fairly easily.
Cheers,
Steve
As a designer, I was asked to quote for a job, which included print, which I did. My current turnover is less than 60k, so I am not VAT registered, and even if I were to win this work, I would still be under the threshold.
The question is, as a non VAT registered ltd company - and consequently unable to charge VAT - how do I invoice correctly? I have already given my client the costs, and stressed that the print costs I supplied did not include the VAT.
If the total for the print is 10k, and my costs are 1k, the total bill will need to be 13k (I can't charge VAT on my costs, but the print has VAT attached at 20%).
By rights, the client should be able to claim back the VAT on the print shouldn't they? Or do I just invoice a total amount and they have to accept that they can't claim it back as I am not VAT registered?
Any advice much appreciated - I can't imagine that this is a unique issue, although I guess regular print buyers would be over the 60k fairly easily.
Cheers,
Steve
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Opus
Messages count : 87Likes count : 3Registration : 4 February 2008I'd have thought that the best bet would be to get the printers to invoice your client direct – that way your client can reclaim the VAT off that invoice and will pay your design invoice separately. The problem with that comes if you've marked the print up but have quoted it as part of the print costs. In that case the printers may be willing to invoice the marked up figure and then pay the additional amount back to you as a form of commission.
Happy to stand corrected on this though – my company was VAT registered from the start so I've never had to deal with a comparable situation. There may well be other ways around it/implications that I've not considered.Opus Creative Design Ltd - Contact in PM
Lupita
Messages count : 207Likes count : 6Registration : 2 November 2006