Hi,
I hope I don't come across as silly but I can't get my head around the VAT section on HMRC. The website is so confusing.
I'm getting quite close to the VAT threshold for business turnover and I know I have to register once I hit that threshold.
What I don't understand is how it will affect me financially.
Do I need to add vat to my services as when I buy the hair extensions the price includes vat so the client is already paying vat on the hair? Do I add vat to my fitting fee i.e increase my fee by 20%?
I'm such a worried and my turnover is currently 65% buying products that the client then pays for and 35% money from my service... if I have to pay an additional 20% to hmrc I can't take a loss that'll take my earnings down to 15% of my turnover but I don't think clients will be happy with a 20% increase overnight. I'll be getting an accountant as it's all too confusing now
I'm so so worried being over threshold is going to destroy my business financially as it's just little old me by myself and my turnover is so high because of the cost of hair not profit im making!
Thank you.
I hope I don't come across as silly but I can't get my head around the VAT section on HMRC. The website is so confusing.
I'm getting quite close to the VAT threshold for business turnover and I know I have to register once I hit that threshold.
What I don't understand is how it will affect me financially.
Do I need to add vat to my services as when I buy the hair extensions the price includes vat so the client is already paying vat on the hair? Do I add vat to my fitting fee i.e increase my fee by 20%?
I'm such a worried and my turnover is currently 65% buying products that the client then pays for and 35% money from my service... if I have to pay an additional 20% to hmrc I can't take a loss that'll take my earnings down to 15% of my turnover but I don't think clients will be happy with a 20% increase overnight. I'll be getting an accountant as it's all too confusing now
I'm so so worried being over threshold is going to destroy my business financially as it's just little old me by myself and my turnover is so high because of the cost of hair not profit im making!
Thank you.
Last edited: