Questions and Answers
VAT Flat Rate
I joined the Flat Rate VAT scheme nearly two years ago. In that time my turnover has risen above the £150,000 limit. Does this mean I have to leave the scheme and if so when?
HMRC recently revised the rules concerning the turnover limit. Now provided that your turnover does not exceed £225,000 net of VAT for the 12 months ended on the anniversary of you joining the scheme then you can continue to use the Flat Rate VAT scheme.
You must include in the £225,000 any exempt income such as bank interest, lottery commission or rents. If you have exceeded the limit then you will have to leave the scheme at the end of the VAT quarter which contains the anniversary date of you joining the scheme.
Date published 5 Dec 2012
This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.Choose the right accounting firm for you
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