Running two businesses solely to stay below the VAT threshold is generally considered artificial separation (disaggregation) and is illegal if done to evade tax, leading to HMRC penalties and mandatory registration. While you can legally operate multiple businesses, they must have distinct, genuine commercial reasons, separate finances, and different management to avoid being treated as a single entity.
Can I separate my businesses to avoid registering for VAT? The short answer is possibly, but we don't recommend that you risk it unless there are valid commercial reasons.
Yes, you can operate multiple businesses under one LLC—but whether it's a good idea depends on your goals, liability tolerance, and how distinct each business is. This structure offers benefits like simplified management, lower administrative costs, and flexible branding through DBAs (Doing Business As).
How to avoid a double payment of VAT? To avoid the UK customer paying the VAT twice when the consignment has a value of more than GBP 135, the solution that seems most obvious is simply not to charge VAT at the time of sale and let the carrier charge the VAT to the customer at the time of delivery.
There is no current limit on how many businesses can be registered at the same address. However, some virtual offices and registered offices might impose a limit on how many businesses you can register, or simply increase the cost when you register more than one business.
The VAT threshold is £85,000 and if your company turnover exceeds this, you'll need to register to pay VAT. You can stay under the VAT threshold by splitting your business, working fewer days, or not taking big one-off payments. If you go temporarily over the VAT threshold you may be able to apply for an exception.
The Rule of Two directs agencies to set aside contracts for bids by small businesses when there is a reasonable expectation of obtaining offers from two or more responsible small businesses that are competitive in terms of market prices, quality, and delivery.
To deregister for VAT by post, you must complete form VAT7. You will need to fill in this form online, print it, and send it to HMRC at the address shown at the end of the form. If HMRC approves your application, you will receive a formal confirmation notice through the post.
For prices including VAT
If you want the price without VAT, divide by 1.12.
If the store ships your purchase to your home, you won't be charged the value-added tax. But shipping fees and US duty can be pricey enough to wipe out most of what you'd save. Compare shipping costs to your potential VAT refund — it may be cheaper to carry the items home with you.
To distinguish between your different ventures, you can set up “Doing Business As” (DBA) names for each business. A DBA allows your LLC to operate under various names without creating separate legal entities. Registering DBAs typically involves filing with your state's relevant agency and paying a small fee.
Simply put, if the decision were to go south, could your business afford to 'burn' cash for six months without going under? This is a critical safety net that protects your business's longevity. It's about acknowledging that not every investment will yield immediate returns and preparing for that reality.
A Joint Venture (JV) is a business arrangement where two or more parties agree to pool their resources to accomplish a specific task, project, or business activity.
VAT rules in the UK require a business to become VAT registered if its taxable turnover hits the £90,000 threshold in any rolling 12-month period, but you don't have to wait until then. Some businesses prefer to register for VAT even though they don't need to. Is this the right decision for you?
Bottom line, you can have multiple businesses under one sole proprietorship. But, the business activities must be very different from each other. TIP: When you have multiple businesses operating under one sole proprietorship, if one business gets sued, both businesses' assets are at risk.
Healthcare: Medical services, hospital care, and the supply of certain medical products may also be exempt from VAT. Financial services: Many financial services, like insurance and banking, are VAT-exempt. Charitable activities: Donations and activities carried out by registered charities may be exempt from VAT.
The United States Government does not refund sales tax to foreign visitors. The foreign country in which you paid the Value Added Tax (VAT) is responsible for refunding the tax. Some countries won't refund after the fact, so check with the Foreign Embassies & Consulates office of the country you visited. Also.
To receive VAT exemption you need to have a long term illness or disability. For example, a physical or mental impairment which affects you being able to undertake activities, a condition which is considered to be a chronic sickness, such as disabilities or you are terminally ill.
Total price excluding VAT - Reduced Rate
The reduced rate applies to a selection of goods and services including health products, fuel and children's car seats. You can calculate the total price excluding the standard VAT rate (20%) by dividing the original price by 1.2.
You could receive a Notice of Enforcement, which gives HMRC the power to seize company assets without having to petition the court. If you continue not to pay, HMRC can issue a Winding Up Petition against your business, which could lead to its Compulsory Liquidation.
Net VAT - exclusion from gross amount
To remove Value Added Tax or to make a reverse VAT calculation the formula is the following: Net: (Amount / 120) * 100 Easy! Divide the amount by 100 + VAT% and then multiply by 100. That's the amount excluding VAT taxes (Net amount).
VAT Answer
When a business cancels its VAT registration, it makes a deemed supply of any goods that are still on hand at the date of deregistration, i.e., you act as if you have sold those goods. If the VAT that would be due on the goods is £1000 or less, no VAT is due.
Yes, you can absolutely run multiple businesses under a single LLC to save on costs and simplify administration, often by using DBAs (Doing Business As) for different brand names, but you must understand the trade-off: all businesses share the same liability, meaning a lawsuit against one can impact the others, making a separate LLC for each high-risk venture often recommended.
The double-LLC structure is a legal strategy for business owners seeking privacy, liability protection, and operational flexibility. It involves the formation of two limited liability companies: a holding LLC and an operating LLC.