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Confused about whether I need to register for VAT

2 replies

gardenpixie · 28/03/2011 20:54

So first of all, I have to apologise for being such a financial dunce...

Some of my income comes from a traditional salary that is PAYE; and most of it comes from ad hoc, freelance jobs.

Taken all together, the self-employed turnover and PAYE income go over the VAT threshold. So I have a couple of questions:

  1. Do I need to count my PAYE income when working out if I should register for VAT?
  1. Do I need to pay VAT on my PAYE income if I register?

I have tried talking to the HMRC helpdesk but their answers aren't very clear or consistent Confused and I know that if I do have to register fo VAT, I need to do it shortly.

Sorry for the dull question, thanks for reading and huge thanks for any light you can shed on the subject; even a nudge in the direction of an info source that could help would be hugely appreciated,

Confused Smile

OP posts:
mranchovy · 29/03/2011 00:43
  1. No. Payments made under a cotract of employment are outside the scope of VAT.
  2. No. You don't pay VAT on any income; the only thing that could possibly happen is that you would have to charge your employer VAT; that would obviously be nonsense, so it is just as well that it it outside the scope!

You do however need to register as self-employed and pay (or apply for exemption from) Class 2 National Insurance: I assume you have done this?

gardenpixie · 29/03/2011 05:52

Hello Anchovy yes I most certainly have registered as self-employed at paid all Class 2 national insurance.

Thank you so much for getting back to me - that's a huge weight off my mind! Really appreciate the advice and sorry again for the daft question,

Smile
OP posts:
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