Tax Advice

What is the VAT status of payments to Companies House?

18 Jan 2016

Accounting for Value Added Tax and filing VAT returns can often prove a bit of a headache for small business owners. Some goods and services benefit from a reduced VAT rate, others have a zero rate of VAT, a few are entirely VAT exempt while most carry the standard 20% VAT rate. But what about payments to Companies House? Which rate of Value Added Tax would a small business pay on Companies House charges?

The simple answer

In most cases the answer is very straightforward – payments to Companies House are exempt from VAT, so small business owners do not pay VAT on Companies House charges.

VatHowever, the real answer may be less clean cut if your small business doesn't manage its Companies House filings and payments in house, and uses a private company to handle them instead.

The less simple answer

Many small businesses don't have the time, inclination or resources to manage Companies House filings in house. Some private companies offer support services designed to help these small businesses incorporate a new business, file annual statutory accounts, file details about newly appointed company directors, and so on.

Companies HouseWhile direct payments to Companies House are exempt from VAT, some private companies may charge VAT on the full cost of their filing service, including the payments they make to Companies House on behalf of a small business. This obviously makes the overall cost of Companies House payments considerably more expensive for small business owners!

Keir Wright-Whyte

photo

Managing Director

0207 043 4000

About the author

Originally graduating with a degree in geography from Edinburgh University, Keir claims that he was then tricked into becoming an accountant by one of the UK's top 5 accountancy practices.The deception extended to the usual training in audit and associated activities.

Keir subsequently worked in a number of advisory roles with clients including in the energy trading, pharmaceuticals and financial services sectors.

He loves working at Accounts & Legal because of the variety of work and clients, the excellent team ethos and morale, the importance placed on genuinely helping and being useful for clients and because he believes what he does matters to clients and helps the firm.

Keir's primary role is to ensure that new clients with complex businesses or needs are on-boarded in the best way and he is a "trouble shooter" both for clients and where complex issues arise internally. He also helps the accounting teams strive to improve what we do for clients, whether processes or services.

When not debiting or crediting, Keir has a penchant for fixing old buildings, skiing, surfing and cycling.

  

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