Construction: calculating and switching the tax regime
We modelled two tax regimes on the real turnover of last year. The annual saving came to 700,000 som.
What happened
A construction and finishing company worked on the general regime with VAT, because that is what it had been advised at registration. Most of its clients, however, were private individuals who needed no VAT credit. The tax built into the price was a direct loss to the margin.
What we did
We calculated both regimes on the real turnover of the last financial year, including the payroll of the site crews and material purchases. We showed the owners exactly where the money was going and prepared the switch: filed the application, ran a reconciliation and closed the carried-over balances.
How it ended
The net saving came to about seven hundred thousand som a year at the same revenue. The full move to the single tax took one quarter, with no site standing still.
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