HmrcForumIsHandy

OK thank you. Usually we manage to pay our bills fine and either make a small yearly profit or loss, but pay our staff and never have any debt. I will talk more to my accountant as to why they're predicting higher VAT/taxes than we normally have, they're still working on our return and I know they've had a few software problems etc - so my hope is they can iron this out. Thanks for clarifying everything.

Hi thanks for your detailed reply. And excuse my ignorance and lack of understanding when it comes to purchasing exempt and zero-rated supplies. I've always just paid whatever I've been told to, and never really questioned things until we've really started to struggle recently with postage and printing prices rising. So if we forget the exempt postage for now and ignore that one - I'm clear that exempt simply means you just can't claim any relief. Just to clear things up, we're not actually a printers. We're a publisher. So we pay writers (who are freelance and aren't charging us VAT because they're self-employed) and we're paying a printer to print our magazines. Which we then sell zero-rated. Is there no way to claim anything back from our cost of print production? We receive an invoice with zero-rate VAT on each month which we pay, and then we sell on to the customer zero-rated also. Certainly we have bits and bobs and merchandise etc that we do pay standard rate VAT on to our suppliers, and I send those receipts on to our accountant every time I make a purchase in order for him to claim the VAT back. However, this doesn't seem to be enough when faced with our very high turnover... Is there no input cost that can be claimed at all on the zero-rated supplies?

Hi, I really hope to get some expert help. I run a small magazine publishing business. We have a large turnover and are VAT registered, but make very little profit due to production and postage costs. Our main costs are magazine printing (zero-rated VAT supply) and Royal Mail postage (exempt, or possibly also zero-rated?). Hardly anything we buy has standard VAT on it that can be claimed back. I've read many forums and blog posts such as this one, that give hope that there is some way to claim VAT (or any kind of relief at all) on our zero-rated supplies: https://blog.pleo.io/en/zero-rated-vat Quotes such as: "A zero-rated VAT item is an item that falls within the VAT scheme but the VAT charge is 0%. So reclaiming VAT on zero-rated supplies is still an option if you’ve bought things necessary for your business that year." And other websites also state about partial exemption, and how relief under de minimis upto £7,500 can be used. Like this one: https://www.taxadvisermagazine.com/article/partial-exemption-vat-registered-businesses It's very complicated - and I've spoke to my accountant for advise. His stance is that if you buy supplies zero-rated (even if you sell them also zero-rated) you simply cannot claim back any VAT or relief at all. I just have to pay the VAT on my turnover regardless. This seems very unfair if this is the case? Surely if I'm selling goods zero-rated, and also not charging VAT to my customers on postage either, there is something we can do? HMRC taxing VAT on my turnover of zero-rated and exempt supplies and sales means I have no chance to keep the business going long term. Thanks for any help and support. Even if there are any small allowances we can somehow benefit from, please advise.