I'm a self employed web developer working in London, UK. Currently I'm not VAT registered but am approaching the current VAT threshold. I'm wondering if anyone knows what is involved in becoming VAT registered? and if they have any advice?
Basically my current contract wasn't supposed to last as long as it has (originally only supposed to be 2 months), and has now been rolling for close to a year - 11 months so far. The problem obviously is that I can't really just turn around to my client and ask for a 20% extra rise in what I'm being paid... So my other choice is to absorb the VAT myself, but is this even allowed?
I've been reading up online as much as I can but nothing I've found really gives me a hand with the actual reality of suddenly switching from one state to another... I'm amazed that more tax information sites don't deal in examples!
Having always dealt with my own tax return I don't have many resources when it comes to financial information so any advice would be much appreciated. Even if it's to recommend a reliable london-based accountancy firm that deals with web professionals.