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VAT rumours

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03 January 2012
Issue: 4335 / Categories: Forum & Feedback , VAT
A self-employed drummer is concerned his turnover may exceed the VAT registration limit and he is considering operating as a sole trader and limited company

I am a self-employed drummer and my earnings vary a lot. This year has been good and if I don’t stop I will soon hit the VAT threshold and I don’t want to know about that.

A partnership with other musicians has been tried but we soon hit the threshold and told each other ‘you can go your own way’ and we are never going back again.

I recently heard some second-hand news which if true would mean that I could stop being self-employed immediately and use a company instead.

There are rumours that the company wouldn’t need to register for VAT until it hit the threshold and apparently I could close the company before it did so and then go back to being self-employed again.

The pattern could then be repeated again and again with the chain of companies being broken up by periods of self-employment in...

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