VAT threshold

[Passionate about skin]

As the Vat threshold has been frozen in the budget for 2 years and then likely to be severely reduced , even halved I am wondering how small salons and individual therapists are going to manage . Especially those who are currently trading just below the current threshold . Surely this would hit thousands of us and having to pay 20 % vat on our services ontop of tax and Ni would put many out of business or have to reduce their hours by half and therefore their takings to avoid the vat . Any ideas ? And anyone else concerned .Thoughts please x

 

[BannerPenguin]

I can't see it ever being severely reduced so not sure where that idea comes from. People shouldn't be afraid of the threshold but once they hit it, they should go full steam ahead and smash that barrier. You're only limiting your own growth staying under it.

 

[salonfrog]

From what I’ve read over the last year or so, the government know this. They’re also looking at possible new rates, so maybe a tiering system where you pay a lower vat rate on your sales to start with.
They’re also looking at increasing the threshold instead (which seems a better solution) - even up to £250k.
I know the NHF have gone back to the Govt with their thoughts on it.

 

[salonfrog]

@BannerPenguin - I think it comes from looking at the rest of Europe where thresholds are more like 20k?

 

[BannerPenguin]

@BannerPenguin - I think it comes from looking at the rest of Europe where thresholds are more like 20k?

True. I'm not sure Europe is a good example of much tbf but that's just my personal opinion before someone comes at me

 

[Passionate about skin]

True. I'm not sure Europe is a good example of much tbf but that's just my personal opinion before someone comes at me

I think the government should support business by putting the threshold up not down ! Vat would destroy many businesses as my accountant says it can be the death knell on top of tax . We end up busy fools ! X

True. I'm not sure Europe is a good example of much tbf but that's just my personal opinion before someone comes at me

True. I'm not sure Europe is a good example of much tbf but that's just my personal opinion before someone comes at me

 

[BannerPenguin]

I think the government should support business by putting the threshold up not down ! Vat would destroy many businesses as my accountant says it can be the death knell on top of tax . We end up busy fools ! X

For sure. I think we would all like to see it raised but knowing how much too is tough. Being based on Turnover makes it tricky.