What if Hammond reduces the VAT registration point?

[unclepokey]

I fear a lot of SPs would take this as an excuse to try to hike their prices by 20%. It would be bollocks of course. SPs are well known as tax evaders although some, I believe, do pay a bit of observance to Income Tax and NICs but stay below the current registration point for VAT.

Those SPs that do try this on, if Hammond is so unkind to small traders, should be seriously challenged because in many (if not most) cases it will be simply untrue that their earnings are down.

[MilleMiglia]

Don't know if this would have any effect, but on a related point, health food shop owners have told me that the market for sports supplements died a death when they became subject to VAT.

[shagmore]

I doubt VAT will go up, no justification for it on a fiscal point of view.
Also with WGs its a cash transaction, they don't pay VAT, if for some weird chance that VAT does go up, your typical punt per hour is £120
This means the pre VAT rate is £100 + VAT at 20% = £120
If VAT went up to 25%, hypothetically, then £100 + VAT at 25% = £125 so not a greta deal.

[JamesKW]

The WG market is as pure capitalism as you can get,so their prices are determined by what the punter will pay.They can increase prices as much as they want but if no one turns up,or everyone cuts down booking time they will need to revisit their pricing structure.

[milo]

I doubt VAT will go up

The original post and thread title is not about raising the VAT rate.

It is about the possibility of the point at which businesses need to register for VAT being lowered.
External Link/Members Only

[shagmore]

The original post and thread title is not about raising the VAT rate.

It is about the possibility of the point at which businesses need to register for VAT being lowered.
External Link/Members Only

Yep, true, mis read that. But still same point applies. You can bet that the Wgs do not send much, if anything to the treasurers pot. If this was a legitimate business then it could potentially make a difference, but as its not it won't

[unclepokey]

My concern is that SPs may try and justify a price rise (to punters) on the grounds that they might now have to send a sixth of their income to the Fisc whereas we all know that many contribute not a penny to said coffer.
It was just a warning to fellow punters not to fall for such representations.

[BarryProudfoot]

Where do agencies stand amongst all this tax debate?

[unclepokey]

Good question.

In my view the likelihood is that the agencies are run by tax dodgers just as much as SPs are tax dodgers. So therefore I suspect that there is just as much possibility that claims to increase fees due to VAT registration point reductions are bogus.

[Mitchtcm]

My concern is that SPs may try and justify a price rise (to punters) on the grounds that they might now have to send a sixth of their income to the Fisc whereas we all know that many contribute not a penny to said coffer.
It was just a warning to fellow punters not to fall for such representations.

Just ask for a VAT receipt :-) .  May even try claiming as a business expense - "Executive Stress Relief" ?

[HarryZZ]

I think there's a way of paying a minimum NIC to make sure you have enough for a full pension, possibly something like Class 2 NICs that the self employed pay. I doubt it'll make any difference, particularly when there'll be so many not making any declaration of income at all, it'd just price some out of the market.

[shagmore]

Just ask for a VAT receipt :-) .  May even try claiming as a business expense - "Executive Stress Relief" ?

I like that idea, I am up for that

[HarryZZ]

I've just seen a profile for a girl working from hotels in Harrogate and Leeds, at the bottom of her profile it says, "looking for a city centre flat to rent, cash only." You can make your own mind up regarding payment of VAT.

[unclepokey]

I've just seen a profile for a girl working from hotels in Harrogate and Leeds, at the bottom of her profile it says, "looking for a city centre flat to rent, cash only." You can make your own mind up regarding payment of VAT.

Indeed - my mind says the landlord that takes the deal will be as tax averse as the SP in question although I'm not quite sure that property rent attracts VAT anyway. Where is Jolyon when you need him?
UP

[mh]

Just ask for a VAT receipt :-)

Yes it is an offence to claim to be charging VAT when not registered to do so. Even if the person receiving the service cannot reclaim the VAT, the provider is obliged to provide on request an invoice with the VAT amount and a valid VAT registration number shown.

VAT registration numbers can be checked online External Link/Members Only.

As if any WG will really register...

[mh]

I'm not quite sure that property rent attracts VAT anyway

It is an odd case of it being optional! A landlord can opt to charge VAT but of course that really limits their tenants to those that can reclaim it.

[unclepokey]

I'm much obliged for that. I confess to being some 17 years out of date with the minutia of that supposedly 'simple' tax.
UP

[BarryProudfoot]

Good question.

In my view the likelihood is that the agencies are run by tax dodgers just as much as SPs are tax dodgers. So therefore I suspect that there is just as much possibility that claims to increase fees due to VAT registration point reductions are bogus.

So how can something so obvious go undetected and avoid an investigation year in year out? 

[Candyman]

Fortunately he hasn't reduced the threshold so they aren't able to use that excuse. In any case I think it would more likely provide a reason to hike agency prices rather than independents but as has been said on here, the prices are determined by the market so unless they all do it it wouldn't happen as they are competing against each other. An agency would lose business fast if it raised it prices by 20% where others stayed the same offering the same portfolio of girls