VAT increase on PV and storage

[SteamyTea]

2 minutes ago, PeterW said:

and charging VAT would be counter intuitive.

There is the small business VAT scheme, think it is 12% of turnover, though not exactly sure of the details.

[PeterW]

Just now, SteamyTea said:

There is the small business VAT scheme, think it is 12% of turnover, though not exactly sure of the details.

 

Agree - its the flat rate scheme. But given I expect the recoverable VAT for them would be less than £500 a year, the added cost to customers (ie  £15k PA) would mean that you're increasing your overhead to basically bring in more money for the revenue and no value to yourself.

 

I do know someone who operates 3 companies though - all legit, but there is some wicked tax evasion avoidance that goes on between them depending on what the client is...

 

 

[K78]

At least this will stop the scam companies. 

 

As soon as something like FIT is announced the price goes up by 300% and they employ double glazing salesmen. 

 

Look at the weather today. Doesn’t really make me wish I had a roof of PV panels. Pointless in NW England. 

[SteamyTea]

4 minutes ago, K78 said:

Pointless in NW England. 

Quick look at the Sheffield University site for Heysham area it shows that 12:30 yesterday it was it was producing 0.207 MW per MW per MW_p. Not to be sniffed at.

[scottishjohn]

36 minutes ago, PeterW said:

 

Quite a simple way actually...

 

Good friend of mine is a sports physio - £50/30 mins, probably does 16 hours a week at most.

 

Turns over around £75k, expenses are the office/consulting room, phone and PC and is self employed and the whole lot goes through the books as taxable etc. No need to go VAT registered as there is very little by way of VAT recovery, and charging VAT would be counter intuitive.

 

 

2 hours ago, scottishjohn said:

no way you can make a living if not vat registered,eg turnover below  vat threshold

and not labour only biz  and all is going through the books 

I did state not a labour only biz --which that is

[Jeremy Harris]

27 minutes ago, K78 said:

Look at the weather today. Doesn’t really make me wish I had a roof of PV panels. Pointless in NW England. 

 

 

We've been exporting to the grid since around 11:00 this morning.  Although it's cloudy, with light showers, we're currently exporting about 1200 W as I type this, and generating around 1500 W.  The Sunamp is fully charged, from excess generation earlier, so hot water is "free" for the next day or so.

[ProDave]

1 hour ago, scottishjohn said:

so is old age 

still I don,t see how can have an income of say £30k from any biz if turn over is less than  £85k  by the time you tak off all overheads 

If it all going through the books 

I generally find my profit is about half my turnover.

 

When you own your house outright, and have no mortgage, you will be surprised just how little you actually need to live on.  Me and SWMBO both work part time and earn enough to keep us ticking over WELL below your perceived survival and are both basic rate tax payers.

[Temp]

Perhaps anyone not quite 60 could get their parents to order the PV :-)

 

 

[jack]

45 minutes ago, PeterW said:

Agree - its the flat rate scheme. But given I expect the recoverable VAT for them would be less than £500 a year, the added cost to customers (ie  £15k PA) would mean that you're increasing your overhead to basically bring in more money for the revenue and no value to yourself.

 

You probably know this, but for those who don't: the flat rate scheme changed last year for businesses with low overheads (and hence low amounts of VAT to recover). The rates are now such that it makes little sense for people - like me - in this situation to stay in the flat rate scheme. It used to earn me a few percent on every invoice, but was hardly life-changing.

 

Being VAT registered is a problem if your customers aren't VAT registered themselves, because it increases the cost to the end user. My electrician gets his clients to buy as much of his materials as possible to avoid being VAT registered, mainly to avoid him suddenly becoming 20% more expensive.

 

In contrast, my work is all business to business, so it makes no difference to them whether I charge VAT or not.

[scottishjohn]

27 minutes ago, ProDave said:

I generally find my profit is about half my turnover.

 

When you own your house outright, and have no mortgage, you will be surprised just how little you actually need to live on.  Me and SWMBO both work part time and earn enough to keep us ticking over WELL below your perceived survival and are both basic rate tax payers.

I,m not saying you can,t --it was you who started this by taking offence to being considered to be in the GIG  economy ,

which was your assumption

I made no such statement

 due to  my taxation  situation with private pension +state pension  i only take  minimum wage from the biz which after tax works out that i get about £1.50 an hour for 40 hr week .LOL

just marking time till i can sell the premises , at the right price

-could give it way tomorrow and  just take on any work that comes in  to keep the body  in shape for the house build  --when i finally get somewhere .then maybe i take a lesser offer for the premises if i need money for build . that would cut down capitol gains on it 

no chance of a mortgage at my age ,even if i wanted one .

I,m at the point now where I am considering de registering  for vat - due to low level of work -

 

 

 

 

 

[ProDave]

I can't see the point in remaining VAT registered if you don't need to be, unless you LIKE all the extra paperwork that goes with it.

[A_L]

8 hours ago, Ed Davies said:

So 20% VAT on domestic fuel, too, I hope. Oh, maybe that won't happen.

 

@SteamyTea & @Ed Davies, afraid not.

 

Quote

New price increases will make it harder for those wanting to reduce their carbon footprint, as in contrast, coal is still given this reduced VAT rate of 5 per cent.

 

https://inews.co.uk/news/environment/renewable-energy-vat-increase-solar-panels-battery-storage/

[scottishjohn]

3 hours ago, ProDave said:

I can't see the point in remaining VAT registered if you don't need to be, unless you LIKE all the extra paperwork that goes with it.

I,m really thinking in front 

if i end up buying a digger and dumper and other expensive toys ,

which I can sell on later

 

[ProDave]

21 minutes ago, scottishjohn said:

I,m really thinking in front 

if i end up buying a digger and dumper and other expensive toys ,

which I can sell on later

 

As an electrician, even if VAT registered, I would struggle to justify buying a digger as a work "tool" so I could re claim the VAT.

 

As it happens I bought one privatey with no VAT.

[Onoff]

3 minutes ago, ProDave said:

As an electrician, even if VAT registered, I would struggle to justify buying a digger as a work "tool" so I could re claim the VAT.

 

As it happens I bought one privatey with no VAT.

 

Trenches?

[scottishjohn]

Just now, ProDave said:

As an electrician, even if VAT registered, I would struggle to justify buying a digger as a work "tool" so I could re claim the VAT.

 

As it happens I bought one privatey with no VAT.

yes but i could be buying it to sell again like a s/h car 

we have a farmer here who has a robinson r22  and he runs it through his books .

he did have problems with them at first ,but after him taking them and showing them where his sheep were  --3000ft up+ 5miles away  and he runs farm on his own --they had to agree 

 

[Onoff]

Great sound bite:

 

Climate crisis: Huge VAT rise on solar panels makes installation ‘entirely uneconomic’, say experts

 

https://www.independent.co.uk/environment/climate-change-solar-panels-vat-government-fossil-fuels-sian-berry-a8906361.html

[PeterW]

So this is even more bizarre ..!!

 

The changes will apply to projects where the technology costs of installation are above 60 per cent of the total price. Labour costs will still benefit from the reduced rate of 5 per cent VAT.

 

So if you’re quoted for solar panels and installation at £5k, but only £2k of that is shown as materials, do you only get to pay 5%..????

 

HMRC love to make it complicated ..... but it does look like a sop to the MCS scheme ....!

[ProDave]

It just infuriates me.

 

With no more FIT there should not be any need for MCS installers, and the way forward is cheap packaged PV systems for either DIY instalation, or instalation by ANY electrician.  That will lower end user prices and perhaps make it viable?

 

Adding VAT and / or new schemes that force the installation to  be done by MCS contractors  is just putting "vested interests" above any real desire do drive an uptake in renewable energy.

[Onoff]

5 minutes ago, PeterW said:

So this is even more bizarre ..!!

 

The changes will apply to projects where the technology costs of installation are above 60 per cent of the total price. Labour costs will still benefit from the reduced rate of 5 per cent VAT.

 

So if you’re quoted for solar panels and installation at £5k, but only £2k of that is shown as materials, do you only get to pay 5%..????

 

HMRC love to make it complicated ..... but it does look like a sop to the MCS scheme ....!

 

I was wondering about that. So as panel prices fall could it be installers labour costs will become comparatively higher and the industry can remain buoyant? 

[ProDave]

4 minutes ago, Onoff said:

 

I was wondering about that. So as panel prices fall could it be installers labour costs will become comparatively higher and the industry can remain buoyant? 

Take my own system.  I got all the kit for £1500. Allowing for the fact it was hard to find it that cheap, £2K is more realistic.

 

It would definitely NOT have been anywhere near £2000 worth of labour to fit it if I had been costing the time it took.

 

So on a PROPERLY charged install (not an over inflated MCS install) the material costs are going to be the dominant cost, unless there is a HUGE drop in panel and inverter prices.

 

Which makes me think this is aimed at continuing the MCS gravy train, who will probably charge £2K for the panels and £4K for the install = 5% VAT, Vs the small guy who charges the install at a realistic cost gets hit charging 20% VAT

[Onoff]

5 minutes ago, ProDave said:

Take my own system.  I got all the kit for £1500. Allowing for the fact it was hard to find it that cheap, £2K is more realistic.

 

It would definitely NOT have been anywhere near £2000 worth of labour to fit it if I had been costing the time it took.

 

So on a PROPERLY charged install (not an over inflated MCS install) the material costs are going to be the dominant cost, unless there is a HUGE drop in panel and inverter prices.

 

I was meaning for MCS installers. Genuine people like @binky where they've had to downsize, let staff or apprentices go on the back of the FiT rate cuts. Right or wrong it did spawn an industry just a pity there were so many cowboys.

[ProDave]

10 minutes ago, Onoff said:

 

I was meaning for MCS installers. Genuine people like @binky where they've had to downsize, let staff or apprentices go on the back of the FiT rate cuts. Right or wrong it did spawn an industry just a pity there were so many cowboys.

Yes but if @binky charges a fair rate, he would be hit by the extra VAT.  It really does seem like it is designed to prop up the cowboys.

 

It hurt (and will forever be a sore wound) that I was denied being able to claim the FIT at any point in the new build and had to resort to a very cheap self installed system to just about be viable from self usage only.  Unless you self install I can't see it being viable just on self usage when you add installation costs, even reasonable ones.

 

It is just bonkers that at the very time when we need a greater uptake of renewable energy "they" are making it so it is not viable for most people.

[Onoff]

You have to wonder at this in the face of common sense. Who benefits? What's the ulterior motive here?

 

Is it simply that the UK Government is so scared by the potential take up of domestic renewables and losses to their coffers they're applying the brakes?

 

 

 

 

[Jeremy Harris]

It may be that the DNOs are getting increasingly concerned about unregulated microgeneration and the impact this has on the local LV distribution network, so want to try to restrict it.  I doubt we'll ever know what has really driven the change, because it will be buried in layers of subtle lobbying, but it does seem that the rapid growth of domestic PV is beginning to cause the DNOs some problems. 

 

Here we often get periods on sunny days when the LV network sits solidly at the upper limit, 253 VAC, causing PV inverters to hard limit, for example.  How typical that is I don't know, but it wouldn't surprise me if there are fairly large swathes of the distribution network that are starting to behave like this.