Clean It Up
UK Window Cleaning Forum => Window Cleaning Forum => Topic started by: richywilts on January 31, 2013, 01:12:56 am
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im defo going to have to go vat reg from april just got contant worry of having to add 20% to there window cleaning bill or poss 10% and swallow 10%
ive not put prices up for nearly 5 years on original customers
should i just go for it or have the ones who went vat reg lose a few of there customers
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How can you not be over the vat threshold with 800 customers, and 4 people working for you?
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I am not vat registered richy but overall it is about price increase , This week i have started increase my prices between £1-£2 ,
Sometimes this is over a 20% increase for some custys and they have been fine , get them prices put up 5 yrs is way to long . Mike
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Flat rate is 12.5% discounted for 1 year at 11.5% I had bout 50/50 commercial so I took the hit, times are hard and some customers will see any increase has an excuse to cancel
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Just increase you prices but dont tell the domestic customers its for vat simples
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How can you not be over the vat threshold with 800 customers, and 4 people working for you?
coz the start of the year was after it had all gone crap i had to dump loads of crap customers i was only having one lad going out then over the summer i began to build it up again its only from about sept/oct its began to pick up again ive got 3 lads not four i think by end of this year il be very borderline on the vat
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The vat threshold counts for any 12 month period so say you now £7k a month regular customers you should register now even if in this tax year you won't/haven't hit it
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im going to have a chat with the accountant next month due to stress hes under at moment
do you mean any tax year??
or just any 12 months in particular
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http://www.hmrc.gov.uk/vat/start/register/when-to-register.htm
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Any 12 month period be it January to January, march to march or September to September.
Direct quote from HMRC.
Supplying goods or services within the UK. If your turnover of VAT taxable goods and services supplied within the UK for the previous 12 months is more than the current registration threshold of £77,000, or you expect it to go over that figure in the next 30 days alone, you must register for VAT.
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im going to have a chat with the accountant next month due to stress hes under at moment
do you mean any tax year??
or just any 12 months in particular
Accountants are paid very well to compensate for the above. Make him earn his money.
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Accountants are paid very well to compensate for the above. Make him earn his money.
Best to wait till tomorrow. Today is their busiest day of the year.
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Accountants are paid very well to compensate for the above. Make him earn his money.
Best to wait till tomorrow. Today is their busiest day of the year.
thats what im doing haha if i have to go vat reg now so be it wanted to put prices up anyway
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Why would you go vat reg Richy you do lots of houses all cash I wouldn't declare cash if I didn't have to !!! More you declare more tax you pay !!!
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Why would you go vat reg Richy you do lots of houses all cash I wouldn't declare cash if I didn't have to !!! More you declare more tax you pay !!!
:o :o
Not the best thing to be posting on an open forum.
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years ago on a run i had ,there was a company that went vat registerd ,many domestic jobs bumped them and the vat was only 15% ,
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My mum says, honesty is the best policy.
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Thats why when you go vat up domestic custys a little and dont telk them your vat reg. Just take it on the chin or up the price a quid or too and tell themits just a normal increase due to insurance and fuel going up.
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Dont go VAT registered,you will regret it in time,been there done that,Dannymack seems to have the best idea IMHO. ;) ;D
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YES don't do it, stay small and unsuccessful, and to tell yourself you are never going to be big.
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If you go over the VAT threshold in one quarter you should be VAT registered.
It is not worked out over 12 months, ask an accountant.
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David @St Ives ,Some people do not want to be big,all you are doing is collecting the VAT for the government,with the chance of loosing customers as your services are more expensive than the non vat man,what tends to happen with a lot of people is they collect the extra money in,spend it,then the vat bill lands on the mat :o :o and do not forget the extra acountants bills
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Extra turnover = extra profit
Extra turnover = extra expenses - vat being one of them.
If you want to earn more money legally you have to be burdened with extra expenses , it really is as simple as that.
If you are happy with the profit that you are making whilst trading under the vat threshold or trading in an illegal manor then that is your choice.
Others do not want to limit their turnover or profit and need to take on extra expenses in order to do that. The upside of this business model is that eventually it will allow/require you to run your business from behind a desk and not with a pole in your hand.
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Why is this so difficult? Just put up your domestic customers prices. Not specifically by 20% but around that. You say they haven't gone up for 5 years so add £1 or £2 quid onto every customer. 9 out of 10 won't complain. Commercial customers won't give a damn cos they can claim it back anyway.
It's really simple
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Only one on the wall Paul, that one is a pole from yester year It depicts how window cleaners used to ply their trade ;)
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Don't know about in UK, but over here, when we send invoices to commercial customers, it looks like we're a fish and chip set up as we have to note on the invoice that all prices are net and not gross (inc VAT). It may give a less than prestigious appearance, but I've split my business to two different companies to stay below the VAT threshold.
It's only my opinion, but anyone who can run a business and not need to raise prices for 5 years must be a fantastic businessman. To have set prices 5 years ago that are still making enough profit today means you should be giving business seminars all over the UK.To be able to calculate profit margins and costs so far into the future means that you're in the wrong line of work. If I was as good as you are Richy, I'd work in the stock exchange mate. Well done.
Got any tips on how you've managed to do that?
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Don't know about in UK, but over here, when we send invoices to commercial customers, it looks like we're a fish and chip set up as we have to note on the invoice that all prices are net and not gross (inc VAT). It may give a less than prestigious appearance, but I've split my business to two different companies to stay below the VAT threshold.
It's only my opinion, but anyone who can run a business and not need to raise prices for 5 years must be a fantastic businessman. To have set prices 5 years ago that are still making enough profit today means you should be giving business seminars all over the UK.To be able to calculate profit margins and costs so far into the future means that you're in the wrong line of work. If I was as good as you are Richy, I'd work in the stock exchange mate. Well done.
Got any tips on how you've managed to do that?
I don't know where you are running your business Chris, but here in the UK what you are doing is illegal. Direct quote from HMRC below.
Do not avoid registering for VAT by artificially separating business activities
If you run more than one business, the sales in all those businesses must normally be added together to determine whether or not you must register for VAT.
http://www.hmrc.gov.uk/vat/start/register/when-to-register.htm#7
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Richy just do it mate, we did back in Nov 2011 and was the best thing we ever done!!
if it dont work out just sell some work so you go back below the limit and deregister!
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I'm in Germany mate. Here, a single person can run as many businesses as they wish. I can't run two businesses that do the same thing though. One biz is glass, and the other is carpets and upholstery cleaning.
When I open another biz later this year, that will be seperate too. As long as any of my firms don't provide the same service and are seperate companies, I avoid the VAT threshold. Same with tax avoidance. Not illegal to avoid paying tax. Tax EVASION is illegal though.
I was just amazed at getting prices so good 5 years in advance though!! I'm impressed with Richy's business vision.
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If you are trading at say £76,000 for a full year and then the following year you increase your turnover to £80,000 and you become VAT registered , you will in fact make a lot less money / profit in that year, you really need to increase your turnover by a very larger amount to make it worth becoming VAT registered.
Go and talk you your account and study your Profit and Loss // Accounts and work out how much you need to turnover as a VAT registered business to make the SAME PROFIT as when you where a non VAT registered business ..................you will be surprised at the outcome.
If you don't do this you could in fact LOOSE MONEY by going VAT registered , you need to know where you need to be turnover wise to make it work , its not very business minded to just say " oh I will just add £1 to each customers bill " :o
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I would also like to say I haven't increased prices in 5 or so years maybe my prices were high originally but we do well and still grow and don't put the prices up much.
It's a recession look how the average wage has gone up in 5 years?? Not much my hourly rate per person is the same has it was 5 years ago are around that and it more than enough in today over exhausted market!
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I would also like to say I haven't increased prices in 5 or so years maybe my prices were high originally but we do well and still grow and don't put the prices up much.
It's a recession look how the average wage has gone up in 5 years?? Not much my hourly rate per person is the same has it was 5 years ago are around that and it more than enough in today over exhausted market!
Upto yourself Ronnie. I'm not that far sighted, so I raise prices every 12 to 18 months. I lose some but that's the way things are I suppose. I just wish I could set prices that're that accurate in 5 years time. Maybe I'll get the hang of that one day.
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If you are trading at say £76,000 for a full year and then the following year you increase your turnover to £80,000 and you become VAT registered , you will in fact make a lot less money / profit in that year, you really need to increase your turnover by a very larger amount to make it worth becoming VAT registered.
Go and talk you your account and study your Profit and Loss // Accounts and work out how much you need to turnover as a VAT registered business to make the SAME PROFIT as when you where a non VAT registered business ..................you will be surprised at the outcome.
If you don't do this you could in fact LOOSE MONEY by going VAT registered , you need to know where you need to be turnover wise to make it work , its not very business minded to just say " oh I will just add £1 to each customers bill " :o
Well said, common sense at last! ;)
The trouble on here is that some use VAT threads as a boasting tool to big themselves up while some only see it as a some kind of trophy, like, hey I'm going VAT registered, that MUST be a good thing eh? :-\
Advice like "just do it" is frankly, fercking stupid!
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YES don't do it, stay small and unsuccessful, and to tell yourself you are never going to be big.
I am not vat'ed so I must be small and unsuccessful, I don't ever tell myself Im never going to be big but I may just start by eating 6 meals a day.
Behind you must be one very clever woman Dave.
Art
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Remember Turnover for Vanity and all that ::)
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It's not a trophy but its an essential move if you want to grow has you can not have a turnover off more than £76000 with out taking this step!
Some people on here don't want to surpas this some do. I put it down to personal ambition all though if you not massively exceed it and do not pass it on ul greatly effect your profits.
When I took the plunge I went mad to get work and increased turnover by about 70% and also went on the flat rate.
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Lee
I was replying to Rich, he wants to be big and successfull, that doesnt mean everyone is the opposite to that, but of course you know that.
and Yes my wife does it all, I just sit there and wave a magic wand and it all just happens.
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David @St Ives ,Some people do not want to be big,all you are doing is collecting the VAT for the government,with the chance of loosing customers as your services are more expensive than the non vat man,what tends to happen with a lot of people is they collect the extra money in,spend it,then the vat bill lands on the mat :o :o and do not forget the extra acountants bills
It was an ironic reply i think.
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Sean
Most people don't just poke there heads through vat, they fly through it and have to embrace it anyway.
We are vat registered and the money i get to keep in my pocket after vat and all other expences is now hell of a lot higher than it was before.
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Sean
Most people don't just poke there heads through vat, they fly through it and have to embrace it anyway.
We are vat registered and the money i get to keep in my pocket after vat and all other expences is now hell of a lot higher than it was before.
I poked my head into a loft once whilst policing and nearly got it kicked off.
Very frightening. A lot worse than windows.
Dean.
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Hi David
I think if you look at the OP they are just popping their head through it and not flying through it like yourself ,but you are right in that sense if you are way over and you really want to expand your business then you will have to deal with it :) :)
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Hi David
I think if you look at the OP they are just popping their head through it and not flying through it like yourself ,but you are right in that sense if you are way over and you really want to expand your business then you will have to deal with it :) :)
Had David popped his own head up a bit more he might also notice that the OP is mainly domestic too & 9 times out of ten doesn't know his own head from his arse! ;D
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Good points lads , I never thought of that.
Somehow, I dont think he could handle the stress.
It absolutely kills me at times, Richie would have constant poops
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I would also like to say I haven't increased prices in 5 or so years maybe my prices were high originally but we do well and still grow and don't put the prices up much.
It's a recession look how the average wage has gone up in 5 years?? Not much my hourly rate per person is the same has it was 5 years ago are around that and it more than enough in today over exhausted market!
I think it's 3 years going on maybe 4 years soon that I haven't uped my prices and have no need to up them , everything was priced well at the time and the prices are still fair when you price a jobs simply price it well so that you don't need to up it in a years time I think that's pretty easy IMO
my girlfriend has landed a job infact I remember back in 99-2000 receptionists wage was like 15k a year pretty much the minium going rate today
Good post ronnie