VAT

Your company would normally be VAT registered and it is a legal requirement to do so if your turnover exceeds the current registration limit.

Being registered enables you to claim back VAT on legitimate business expenditure.

Alternatively you may join the flat rate scheme whereby you charge your customer 20% VAT but pay over the VAT to HMRC at a lesser amount based on a percentage of the gross invoice. This is likely to be beneficial for companies with small amounts of VAT expenses and is another way that AccountingIT maximises the financial reward of contracting through a limited company.