VAT and tradesmen

I fully understand the competitive advantage of a tradesman who is not VAT registered has over one who is registered, and therefore the urge some tradesmen might have to keep their (official) turnover below the VAT threshold.
However once you reach that threshold and become VAT registered what if any advantage is there to a tradesman of "discount for cash"?
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Chris B (News)

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On Thu, 15 Aug 2019 11:39:11 +0100, Chris B wrote:

Immediate cash for paying suppliers and employees ?
One less trip to a bank ?
A time saving for chasing up that "I'll transfer it as soon as I put the phone down ...." customer ?
Having worked in a small business, I am weary of the "cash payments = up to no good" trope that it's suited the media to keep frothed up. Especially when the Apples, Googles, Starbucks and Amazons of this world manage to swerve far more tax without taking payments in cash than Bloggs builders might do with the odd <cough, cough> "cash job". (Which I disapprove of anyway).
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On 15/08/2019 11:50, Jethro_uk wrote:

Yes ok fair points

No, I was just asking to try and understand what other reasons there might be beyond "up to no good", some of which you have highlighted.

I'm with you all the way on the "legal" means some of these giants have to minimize their tax contributions.

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wrote:

It's a perversity of the law that directors are obliged to maximise shareholder value.
In any case, no one (individual or corporation) is obliged to act in such a way as to increase their tax liability. Neither legally nor morally.
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"People don't buy Microsoft for quality, they buy it for compatibility
with what Bob in accounting bought last year. Trace it back - they buy
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On 15/08/2019 12:49, Tim Streater wrote:

Indeed, it is the law that needs a shake up, not the corporate giants accountants/lawyers.
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Chris B (News)

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On 15/08/2019 13:19, Chris B wrote:

Perversely, trying to charge more tends to lower receipts from global businesses, since they are free to organise in whatever tax jurisdiction works out cheapest for them. The key is often to make sure you are the cheapest place to do business, so that they funnel as much money as possible though your tax system rather than someone else's.
(needless to say that concept really upsets the lefties!)
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It's not so simple when they don't move production (especially largely service industries) but are allowed to arbitrarily allocate profit to whichever locality suits them best. Like Amazon and Facebook etc. We may need to bribe Nissan to make cars here, but we don't need to induce Amazon and Facebook to make money out of activiities carried out in the UK.
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Roger Hayter

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On 15/08/2019 16:16, Roger Hayter wrote:

No we want to induce them to let us tax them on money they make all over europe not just here!
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Back in the 60s when there were controls on capital movement large companies like Phillips got round that by internal valuations of goods being transferred between companies. Today its often done by charging corporate overheads to transfer profits to a different tax regime. However whist we target US companies such as Amazon and Google don't forget there are many UK based companies who are doing the same thing and bringing their profits back to the UK. Within the EU they can also shift their VAT base to the lowest regime (Luxembourg in particular - guess who set up that deal). Once we are out we will be able to keep all the VAT we collect and set our own rates.
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bert

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On Thu, 15 Aug 2019 12:49:23 +0100, Tim Streater wrote:

Well if that wasn't the law, how many shysters would set up companies that didn't maximise shareholder value, but instead line their own pockets ?

No argument from me.
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Plenty do just that anyway, most obviously with Maxwell, Murdoch, Branson, Dyson etc

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That’s a lie and they certainly arent legally obliged to use that sort of very dodgy accounting to do that.

But they are both legally and morally obliged to not use the most flagrant tax avoidance scams.
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It's not a lie but it's a very nebulous requirement.

They can do anything that's legal whether you regard it as a scam or not. Blatant loopholes over the years have been closed - hence the enormity of the UK tax codes.
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bert

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It isnt a requirement.

Those have don’t nothing about the ways that Amazon. Murdoch, Branson etc have shifted the profit they make to zero tax havens.
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The difference with the majors is that they can use bogus transfer payments to their alleged parent company in a tax free haven like the Bahamas etc.
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On 15/08/2019 11:39, Chris B wrote:

My experience (which is not recent) as a tradesman was that customers always initiated the conversation by asking for a 'cash discount'. They wanted me to take the cash, not declare the amount to the revenue and not charge them the VAT. It's a mug's game as a tradesman because the benefit is entirely the customer's and the risk (if you are caught) is entirely the tradesman's.
TW
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On 15/08/2019 11:53, TimW wrote:

The way I answer the "discount for cash" customers in the shop is: It's more effort and security risk taking cash as it all has to go into the bank to allocate stock etc. In my head I'm thinking "you have cash because you took it and didn't declare it for income tax therefore you've already saved 20 or 40% in tax so I'll be buggered if you're then going to try and get additional money off for ME defrauding the Tax/VAT inspector. If I were to choose to not declare it then the "perk" should go into my pocket not a "double dip" discount for one person.
But our cash intake is virtually non-existent and people use debit cards in preference to having a wallet/purse full of cash these days.
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That’s not correct when the tradesman doesn’t get to pay income tax on that transaction etc.

But the only real risk is that it might be the tax man pretending to be a customer and that’s very unlikely indeed.
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On 15/08/2019 21:16, Rod Speed wrote:

True that at the end of the year that transaction might not appear in the bloke's tax return.

Clueless as usual. As a tradesman I am allowed to take cash and I am allowed to offer any price I like. The VAT inspector looks at your records and your VAT return because any offense would take place elsewhere at the end of the quarter when you fail to include that transaction in your return. The customer would not be a VAT inspector in disguise because that is just a bizarre idea. Why? Tim W
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Yes you are, as always.

Duh.

And the only time that the inspector would know about that cash transaction is when they pretended to be a customer, fuckwit.

Corse they would to know about that cash transaction, fuckwit.

Thanks for that completely superfluous proof that you actually are that terminal a fuckwit.
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