Q. Regarding the Autumn statement FRS rules. Is it safe to say the the definition of bought in goods also include bought in services? For example if a I am a plumber and the size of my contracts varies, meaning I have buy in the services of other plumbers or an electrician, would this count as bought in good exceeding 2% of my turnover, or is it strictly relating to physical goods.
A. Thank you for your enquiry. Should you have to contract the services of other plumbers or electricians to complete a contract these costs would not be classed as “goods” for VAT purposes. Rather these would be “services” and not count towards 2% of your turnover test in determining your limited cost trading status.
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This answer was provided by Qdos Accounting.