Email a collegue.| Headline: | C&E urges businesses to join VAT flat rate scheme that allows businesses with a turnover of up to £150,000 to calculate their VAT as a percentage of total turnover |
| Description: | C&E urges businesses to join VAT flat rate scheme
Only a quarter of eligible businesses in the surveying and architectural sectors have joined the VAT flat rate scheme, according to Customs & Excise. Over 25,000 businesses in the "architect, civil and structural engineer or surveyor sector" might be eligible but 19,000 have not joined the scheme. Across the UK, 671,000 businesses are eligible to join the FRS, Customs said. Roger Halson, Customs' small business champion, said: "Small businesses are the engine room of our economy. Anything we can do to help them focus on their core task of running their business has to be a good thing. While a certain amount of paperwork is inevitable for any small business owner, it is important that it is kept to a minimum. "If we can provide shortcuts to cut down on paperwork and tasks such as 'doing the books', such as the Flat Rate Scheme, which has proven to save time and hassle for small business owners, then it is a win-win situation for all involved." The FRS allows small business owners with a turnover of up to £150,000 to calculate their VAT as a percentage of total turnover rather than calculating the VAT on each purchase and sale. Customs said that in a recent survey, 81% of businesses that have joined the FRS said they spent less time completing their VAT returns. Of these, 98% agreed that the time saving involved was beneficial to the company. More information on the scheme is available on Customs' website, which has a ready reckoner and an online tool "which will help companies work out their sector and estimate the difference joining FRS could make to their VAT returns". Customs offered a case study, saying: "Sansom Clarke Ltd is a small firm of chartered property surveyors. The company was formed in 2002 out of a previous partnership that had lasted over 10 years. Sansom Clarke currently has a staff of four - two directors and two part-time secretaries. "Jeanette Davies is a part-time secretary at Sansom Clarke, and responsible for managing the accounts. When the company received a leaflet from HM Customs and Excise about the VAT Flat Rate Scheme, Jeanette conducted a comparison survey to find out whether it would save her time or money. She was pleased to find that it would allow the company to do both, and after talking to the company accountant, she signed the company to the scheme last year. "'The VAT Flat Rate scheme has been beneficial for our company in terms of time saved, and I would certainly recommend it to other small businesses' commented Jeanette." |
| Date: | 06.03.2005 |
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