Forum

• # 82854
• Sat 26 May 2012 09:06 AM

Hello,

I might start working for a new client, working on a simple cashbook (income & expediture) and have noticed that he has been charging VAT on his sales invoices but he isn't Vat registered.
I have told him that this is not the way it should be done but he disagrees. Fine with me as long as he pays me, but what about my responsibilties ? Will I, as his bookkeeper, get into trouble if this comes out ? Am I putting my career on the line if I work for him ?
What is the situation, generally speaking, if we suspect some things that seem incorrect ? In worst case scenario, report to SOCA, but the more minor things ? 
Best Wishes,
Andreas    

• 
  Quote
  

• # 82856
• Sat 26 May 2012 10:37 AM

If he is charging VAT but is not VAT registered, it is not ‘fine’. If he will not accept your advice that this is not correct practice, I would not work for him.

• 
  Quote
  

• # 82859
• Sat 26 May 2012 07:32 PM

Just a thought - have you asked him why he's charging VAT when he's not registered and what makes him think he's entitletd to do it ???   basically - he's taking money under false pretences and you are party to it - I'd drop him like a hot potato

• 
  Quote
  

• # 82862
• Sat 26 May 2012 08:33 PM

Hi there,


Not only isn't this "fine" but it could be working to his disadvantage as well.  If he is not VAT registered his prices should be cheaper than his competitors that are VAT registered.   If he is hoping to charge more by making it look like he is VAT registered then that is obtaining money by false pretences.  What does he hope to gain by making it look like he is VAT registered?  You are supposed to show your VAT number on sales invoices if registered and I'm surprised none of his customers have picked this up (unless they are members of the public who don't know).

I would make it clear to him that this is not right, and I would put it in writing to cover yourself (email will do).  Use words like "large fine" and "penalties"...should make him think twice.

This is taken from HMRC website:-

"If the person is not registered for VAT, we can assess a penalty for issuing an unauthorised VAT invoice in addition to recovering the amounts charged as though they were VAT."

In other words, not only can HMRC impose a fine for doing this, but also recover any amounts that he has charged as VAT.  


Pauline
   

• 
  Quote