Simmers & Co
Topical Points Answer
Is the VAT Flat Rate Scheme for Small Businesses worthwhile?
This scheme is only available if your annual Turnover ( net of VAT) is less than £150,000. Instead of accounting for VAT on all your income and expenditure and paying (or having refunded) the difference, there is a set flat rate percentage calculated on the Turnover for each quarter.
The flat rate percentage varies depending on the type of business. There are also allowances for Capital Expenditure of over £2,000.
Whether it is advantageous or not depends on your type of business and how it is run. Generally, however, there is no real saving in book-keeping if you are keeping your accounting records up to date.
If unsure whether to adopt the scheme, you should seek professional assistance.