VAT on Livery

[Housemouse]

The most common types of livery are: DIY, Part livery, Full livery and Working Livery.

If you are a livery yard owner, should you charge VAT on any or all of these livery options?

I did hear that if you put your horses name on the door then you should pay VAT????

 

[welshcobmad]

What?! I've never been charged VAT & my horses names always on the door.

 

[FestiveBoomBoom]

Not a yard owner but my yard adds on VAT to our monthly bills (unfortunately). I am DIY and my yard charges VAT for all types of livery options. Usually works out at between 20-30 quid a month

 

[Syrah]

As a business owner or self employed, if your revenue is over a certain amount (used to be 60k) per year, you have to register for VAT and therefore charge VAT.

Under that amount it's optional to register.

If someone is charging VAT, they have to display their VAT number on the invoice.

It has nothing to do with horses names on doors or the type of livery offered, it's all about either the revenue or choice if below the limit.

 

[FRESHMAN]

We built a brand new purpose built yard & know that we will be working to add many improvements over the future.
So even if you are not hitting the magical figure of 60k p.a you need to register for vat in order to re claim all your vat costs back. I believe the figure is still 60k but it is turnover not profit & is reached in no time at all even when running at a loss. So whilst I agree it is optional, it is near impossible not to register with the cost of any building work & materials all carrying the dreaded vat.

 

[Custard Cream]

The VAT threshold is 73k. If your turnover for any period of 12 months has been or is likely to be over that then you should be registered for VAT. I only know this as we've just done it with our business.

 

[Bertolie]

Taken from Horse magazine:

Livery VAT rule change.
"owners of horses on livery should not expect to see VAT added to their bills unless their yard provides professional schooling.". "however.....'stable livery packages' should continue to be exempt as long as services are billied as one item." "if services such as bringing in or rug changes are shown seperately on an invoice it becomes a supply of services and therefore taxable."

Just a couple of quotes from the February issue of Horse on livery VAT changes.

 

[Bosworth]

it is not straightforward as people are detailing, yes there is the VAT threshold, but you can of course register to reclaim vat against improvements, work etc. What you charge VAT on tho is a moveable feast. DIY livery does not require VAT. you do not charge VAT on grazing or accommodation (provided that they are not renting a specific stable ie you are just providing a stable not that one particular one, which may be where the name plate myth comes from) So DIY is vat free, you do however have to charge VAT on any services you provide. So if you turn out, bring in muck out then you charge VAT on those. If you do part livery then you can charge VAT on the service you provide and seperate out the grazing so thats not vateable.

You cannot charge VAT on feed, but you can charge VAT on the making up of feeds and putting it in the stable. You cannot charge VAT on the Haylage, but you may well have to pay VAT on the making of it so you can reclaim that back.

I had a VAt inspection a year ago, had gone through eveything with the VAT office on their helpline and had all the information to hand, but when the VAT man came round he was totally bemused, he brought his manual out, about 4 inches thick and leafed through it. In his opinion there were 3 options, 1) i was doing it correctly, 2) I should be totally zero rated 3) I should be paying charging VAT on everything. In other words he had no idea. he went through all my books, I use SAGE so everything on the computer, he looked for problems and came up with non. and left after 2 hours basically saying i may owe nothing or I may have to pay back everything we had reclaimed (approx70k). and that was it, we have heard nothing more and he had said he would come back immediately with any problems.

So what I would say is do not listen to your accountant, you need to phone VAT helpline they record the call against your VAT registration number so that they can recall the information you were given. The way I was doing it was all because I was told by the VAT office, and I was told that the inspector would be going back and listening to those calls.

Do not take the word of friends, or us on here, despite what people say. You need to have it from the VAT office themselves

 

[FRESHMAN]

Thanks Bosworth that is all very usefull info & I shall place a call this week to the vat office & see if info I was given in 2008 has now changed.
Loopholes I can see arising & would value your opinion on are as follows.
My yard is basically assisted DIY (many variations) ours is as follows. We have a static rent of £x ( depending on size of horse/pony) this includes am short feeds & nets 7 mornings per week. Haylage in relation to size of horse & therfore price. Full use of Indoor & outdoor arenas inc lights between certain times. Grazing, secure double tack rooms. Etc.etc. We do any other service on a day to day basis at a set price. We are told any service provided by a partner/owner does not attract VAT. Any service by a member of staff does attract VAT. If you employ 3 staff like ourself it would be foolish to try to pretend the service is given by a partner/owner? So if my son gives a lesson showjumping ( lots of International exp) using all facilities it can actuallywork out cheaper than a member of my staff ( bhsai) cos of the vat! So are you saying that if I built in certain packages ie: am turnout or bring in. Or some may choose am muck out & turn out. Etc this could avoid the vat, providing it is a set price under the umbrella of a set plan/price lets call it Gold Silver & Bronze? Can I still stay vat registered to re claim on capital expenses? & last but not least can I provide shavings & reclaim the vat but not pay vat on the mark up price when selling providing I allow for each "plan" having 1, 2, or 3 bales per week?
Q Q Q sorry I have probably just overloaded. Would appreciate your thoughts

 

[FRESHMAN]

Sorry Bosworth, meant to add/ask if you do not provide a "particular" stable just you have "a stable" how do you get round the fact that some people often purchase 3 bales of shavings/straw/whatever & others 1 per month!
Surely you can not claim its a free for all when using a stable. No one would pay for bedding if someones elses horse gets the benefit of it? How does that one work?