Fuller Spurling

  • News
  • Client zone
Menu
  • Home
  • About us
    • People
      • Mark-Harvey-200×200Mark Harvey FCA – Partner
      • sue-keane-200×200Sue Keane FCA – Partner
      • amy-robins-april-2019-200×200Amy Robins LLB CTA ADIT – Partner
      • Consultant
        • Patrick HopePatrick Hope
      • Senior managers
        • David HodgsonDavid Hodgson FCCA
        • lana-ward-apr-2019-200×200Lana Ward
    • Offices
      • Fuller Spurling Chertsey officeChertsey Office
      • Fuller Spurling Sandhurst officeSandhurst Office
    • News
      • What’s the current tax situation for…
      • The Budget Pack on the Fuller-Spurling smartphone App
      • The tax filing deadline for paper returns is approaching
    • About us
      General

      We give practical help and guidance whether you need help with your tax return or whether you run a business and need accounts, tax or VAT help and advice.

      Limited Companies and LLPs

      Whatever your size or industry sector we have the experience to be able to help and advise you. If you are a larger Limited Company or LLP then we can also carry out the statutory audit.

      FCA regulated entities

      If you run a business which is regulated by the Financial Conduct Authority we can help lodge reports to the FCA (typically via “Gabrielle”) and carry out the statutory audit if required.

      Charities

      We help charities prepare accounts and carry out Independent Examinations of Charity accounts or audits of the accounts of larger Charities.

      Solicitors

      We help prepare accounts and carry out Audits as required by the Law Society

    • Close
  • Accounting
    • Accounts & Auditing
    • Bookkeeping
    • Our Online Accounting Services
    • Close
  • Tax
    • Tax Compliance
    • Tax & VAT Enquiry Fee Protection Service
    • Tax Investigations and enquiries
    • Tax Planning
    • VAT
    • Reverse Charge Rules for Builders and Related Trades
    • Close
  • Specialist
    • Business Advisory
    • Charities
    • Company Secretarial
    • Contracts for self employed
    • ICAEW Business Advice Service
    • IR35 Contractors
    • Payroll
    • Tax & VAT Enquiry Fee Protection Service
    • Close
  • Land & Property
    • Inheritance Tax
      • Family Investment Company
      • Inheritance Tax and the Family Home
      • Property Trading Companies and Business Property Relief Case Law
    • Buying a property
      • Property Incorporation vs Ownership
    • Selling a property (Capital Gains Tax)
      • Capital Gains Tax – new payment deadline for residential sales
      • Changes to CGT 2020 (PPR and lettings relief)
      • CGT and Rebasing Explained
      • CGT Dates for Different Property Sales
    • Close
  • Making Tax Digital
    • MTD for VAT
    • Close
  • Contact Us
Home » News » Updates » Splitting a business to avoid registering for VAT

12th June 2019 by Mark Harvey

Splitting a business to avoid registering for VAT

As the VAT registration threshold is to be frozen at £85,000 until at least April 2022, more businesses will be drawn into the VAT net simply by increasing their prices by inflation every year.

If you do not want to register for VAT you either have to keep your total sales low by working fewer hours or consider splitting the business into two entities, each with turnover under £85,000. Business splitting is legal but needs to be done correctly to be effective for VAT purposes.

First identify the separate products or services you supply and whether you provide them to different groups of customers. For example you may clean commercial buildings for business customers and domestic premises for non-business customers. The commercial cleaning services could be provided by a company and the domestic cleaning by a partnership. Although you control both entities, the back-office support must be managed carefully to ensure HMRC agree that two businesses exist in practice.

You should:

  • set up separate bank accounts and insurance for each entity;
  • purchase supplies through distinct orders in the name of each business; and
  • make sure the correct business bank account is used to pay for the goods acquired and deposit sales income.

If both businesses operate from the same address, set up a formal lease agreement under which one business sublets part of the area to the other. If employees work for both businesses the costs should be charged across at the point one business lends the employee to the other.

Would you like help and advice on this or any other issue?
Contact us straight away by telephoning 01932 564098 or email us using our ‘Contact Us’ page.

This note was published from our Summer 2019 Tax Briefing dated June 2019

Please be aware that the information above may have changed in subsequent months.

This note is written for the general interest of our clients and is not a substitute for consulting the relevant legislation or for taking professional advice.

Our Summer 2019 Tax Briefing

Filed Under: Updates Tagged With: company, Tax, VAT

« Marriage allowance
HMRC starter checklist for all new employees and getting the PAYE code right »

What’s your question?

Call 01932 564098

Recent News

  • What’s the current tax situation for…
  • The Budget Pack on the Fuller-Spurling smartphone App
  • The tax filing deadline for paper returns is approaching
  • Our Autumn 2019 Tax Briefing
  • Inheritance Tax Changes Ahead?

News Categories

  • Articles
  • Case Study
  • Company Law
  • Opinion
  • Tax
  • Tax Q&As
  • Testimonial
  • Updates
  • VAT Q&As

Join Us

Latest News

  • What’s the current tax situation for…
  • The Budget Pack on the Fuller-Spurling smartphone App
  • The tax filing deadline for paper returns is approaching
  • Our Autumn 2019 Tax Briefing
  • Inheritance Tax Changes Ahead?

Legal and Technical

  • Privacy Policy
  • Terms and Conditions
Fuller Harvey Ltd
Registered in England No: 3881540

© 2010–2019 Fuller Spurling - Chartered Accountants · Site by Powerhut · Built on the Genesis Framework