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Readers’ forum: Should company be compulsorily VAT registered?

03 June 2024
Issue: 4939 / Categories: Forum & Feedback , VAT
Billy one-mate

My client is a new company that started to trade on 1 March 2024 and only has one customer a partly exempt business.

Turnover is £10 000 per month which was negotiated on the basis that this is inclusive of any VAT that may be due. I had anticipated that my client would be registered for VAT on a compulsory basis with effect from 1 January 2025 in accordance with VATA 1994 Sch 1 para 5.

During April 2024 HMRC issued a letter stating that it will register my client for VAT with effect from 1 June 2024. The letter refers to VATA 1994 Sch 1 paras 1(1)(a) 1A 2 and 5. The letter also states that HMRC is aware that the trade carried on by my client had previously been carried on by its sole director and shareholder on a...

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