Value Added Tax (VAT) can be a significant consideration for businesses. With the VAT registration threshold in mind, some Bexleyheath business owners might wonder if establishing two separate companies could be a way to avoid VAT. Let’s explore this concept:
- VAT Registration Threshold: Currently, in the UK, businesses with a taxable turnover exceeding £85,000 within a 12-month period must register for VAT.
- Separate Businesses vs. Artificial Separation: While having two separate legal entities might seem like a loophole, HMRC can investigate structures deemed “artificial.” If the businesses are essentially one economic unit, they will likely be treated as such for VAT purposes.
- Focus on Growth Strategies: Instead of exploring potentially risky structures, it’s more beneficial to focus on sustainable growth strategies that keep your turnover below the VAT threshold organically.
Considering VAT Registration?
While VAT registration comes with additional responsibilities, it also offers benefits like reclaiming input VAT on business expenses. Our qualified accountants can assess your circumstances and advise you on the best course of action regarding VAT registration.
A wonderful serenity has taken possession of my entire soul, like these sweet mornings of spring which I enjoy with my whole heart. I am alone, and feel the charm of existence in this spot, which was created for the bliss of souls like mine. I am so happy.
my dear friend, so absorbed in the exquisite sense of mere tranquil existence, that I neglect my talents.
I feel that I never was a greater artist than now. When, while the lovely valley teems with vapour around me, and the meridian sun strikes the upper surface of the impenetrable foliage of my trees, and but a few stray gleams steal into the inner sanctuary.